Jersey and China?

Aug 2010:
The tax advantages of using an offshore jurisdiction tend to be accepted as the main reason for going offshore. However, reputation and regulation are equally important.

More and more China's capital market investors and financiers are recognising that Jersey is the place to do business from incorporating investment vehicles as well as utilising Jersey's fund regime which provides the full suite of options, from very private structures to full retail funds, meeting most promoters' and investors' requirements
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It is now six years since Goldman Sachs coined the term BRIC ( Brazil, Russia, India and China) in its Building Better Global Economic BRICs report. In its 2007 report, the investment bank stated that the BRIC countries’ combined weight is already 15 per cent of the global economy and according to last year’s figures China has overtaken Germany to become the third-largest economy in the world.

As China’s success continues to grow, the appetite from China’s private and corporate wealth sectors for sophisticated financial solutions has also increased. For over 16 years Jersey has had business links with China.

Indeed the first Chinese company was registered in Jersey in 1994 and China’s economy has nearly quadrupled in value since then. To date, a quarter of the Chinese companies listed in London have done so through Jersey.

Industry professionals have also welcomed the 2009 decision by the Hong Kong Stock Exchange to allow the listing of Jersey companies. Carey Olsen advised on the “in principle” application by Jersey Finance for the admission of Jersey companies to the Hong Kong Stock Exchange.

Jersey has also seen a rise in banking deposits from China and the surrounding region. Total banking deposits at 31 March 2010 in Jersey were £177.6 billion (around $263.5 billion); 8.9 per cent were from the Far East compared to 3.5 per cent at the end of last quarter December 2009.

Jersey Finance opened a representative office in Hong Kong in October 2009 to strengthen the ties further between the two countries. With the increasing expertise in Jersey it is obvious as to why Jersey is becoming a jurisdiction of choice for China.

This will of course have a knock on effect on the creation of future jobs in Jersey and offshore finance jobs in general.