appetites’ all work to attract business, along with ‘a
highly flexible range of vehicles and structures to suit all
asset classes, highly skilled, experienced and responsive
service providers who provide real substance on the
ground in the Islands, and high levels of international
co-operation and transparency’ he adds.
These high standards have been backed up with
attestations from influential external bodies such as the
International Monetary Fund (IMF), the Organisation
for Economic Co-operation and Development (OECD)
and Financial Action Task Force (FATF). Given that as of
June 2011 fund assets of approximately £475bn were
managed or administered in the Channel Islands
(excluding unregulated fund figures), the flow of funds
though these hubs clearly continues apace.
Indeed, the number of available schemes and the
total value of assets under administration in the Channel
Islands have consistently met comparably high levels
which have remained steady and can be considered a
gauge of the continuing popularity of these jurisdictions
as fund hubs. James Mulholland, Corporate partner at
Carey Olsen explains that the islands remain attractive
because of their ‘deserved reputation for sound regulatory principles, their expertise as established fund centres, the fund administration services they offer and the
general servicing of the investment funds sector’. This is
particularly true for private equity structures and alternative investment fund structures for non-UK companies seeking London Stock Exchange listings, for which
the islands remain ‘jurisdictions of choice’.
However, the inevitable truth is that, despite this
winning combination of factors, the status of other
much-hyped financial hubs is turning heads. ‘There is
certainly evidence of onshore fund domiciles such as
Singapore growing in popularity, and particularly in the
sphere of retail funds where offshore centres have rarely
been used of late’ confirms Robins. Whilst this does not
exactly detract from the undeniable assets offered to
the global financial community by the Channel Islands,
the popularity of hubs like Hong Kong and Singapore
are being championed by the financial institutions with
bases in these hubs in a bid to position them as preeminent Asian financial centres.
Despite reports of a growing number of fund vehicles
with a south-east Asian focus, the number that are established in Singapore is not as significantly high as some predictions. Nonetheless, Indian focussed funds do consider it
a lucrative access point. Carey Olsen’s Mulholland explains
the firm considers Singapore ‘more as a partner and conduit for business rather than a competitor jurisdiction’.
‘Obviously the fund raising environment generally is
being adversely affected by the global financial crisis’
notes Jersey-based Ogier partner Michael Lombardi.
Despite this, he remains confident that the Channel
Islands have more than maintained their market share.
While competition between financial hubs is something
Indeed, the number of available
schemes and the total value of assets
under administration in the Channel
Islands have consistently met
comparably high levels which have
remained steady and can be considered
a gauge of the continuing popularity of
these jurisdictions as fund hubs.
which is prevalent in the wake of the global downturn,
Lombardi says that it is Cayman that remains a strong
competitor. ‘However, the Channel Islands' market is
more focused on the European investor base which
tends to have preference for well regulated jurisdictions’
While certain core off-shore markets have not necessarily historically overlapped to a significant extent, as
Robins points out, ‘BVI, Cayman and Bermuda have
long had a US, Middle Eastern and Asian bias and
Singapore clearly has an Asian bias. That's not to deny
that there are, for example, some Cayman structures
widely used by European clients, hedge funds for example, or some Channel Island structures widely used by
US clients such as listed private equity funds’.
It is unsurprising, then, that as the effects of the global financial crisis continue, ‘the trend is towards all of
these jurisdictions adopting a more global marketing
mind-set, each selling its particular areas of core expertise and experience to the wider world’. This is inevitably
going to engender an increasing atmosphere of competition among these hubs, which Robins claims ‘is set
to become more, not less, intense, with centres of
excellence for particular work types emerging’.
There is little doubt that, in order to keep up with the
drive to assume a more global approach displayed by
growing financial centres, the Channel Islands can ill
afford not to broaden its international focus. ‘There is
clear evidence of offshore firms adopting a more global