AnniversaryTenth issue p6 Air travel p16 The budget Summer 2008 INTERNATIONAL FINANCE AND BUSINESS

Contact our website: www.gibraltarfinance.com SPONSORS

Gibraltar International Magazine is grateful for the support of the finance industry and allied services (with the encouragement of the Finance Council) in the form of committed sponsorship. We would like to thank the following sponsors:

GIBRALTAR FINANCE CENTRE Tel: +(350) 200 50011 Fax: +(350) 200 51818 http://www.gibraltar.gov.gi

ABACUS FINANCIAL SERVICES LTD. HASSANS Tel: +(350) 200 73520 • Fax + (350) 200 48267 Tel: +(350) 200 79000 • Fax + (350) 200 71966 www.abacusgib.com www.gibraltarlaw.com

BARCLAYS BANK TOTUS Offshore Financial Services (Gibraltar) Ltd. Tel:+(350) 200 76108 • Fax + (350) 200 76976 Tel: +(350) 200 52378 • Fax + (350) 200 79987 www.totus.gi www.barclays.com MARRACHE & CO DELOITTE Tel: +(350) 200 79918 • Fax + (350) 200 73315 Tel: +(350) 200 41200 • Fax + (350) 200 41201 www.marrache.com www.deloitte.gi PIRANHA DESIGNS EUROPA TRUST COMPANY Tel: +(350) 200 45599 • Fax + (350) 200 52037 Tel: +(350) 200 79013 • Fax + (350) 200 70101 www.pdg.gi www.europa.gi QUEST INSURANCE MANAGEMENT LTD. BESPOKEXECUTIVE Tel: +(350) 200 74570 • Fax + (350) 200 40901 Tel:+(350) 200 46328 www.quest.gi www.bespokexecutive.com JYSKE BANK (PRIVATE BANKING) INVESTGIBRALTAR Tel: +(350) 200 59282 • Fax + (350) 200 76782 Tel: +(350) 200 52634 • Fax + (350) 200 52635 www.jyskebank.gi www.investgibraltar.gov.gi LLOYDS TSB MONARCH AIRLINES Lloyds TSB Bank (Gibraltar) Ltd Tel: +44 (0) 8700 405040 Tel: +(350) 200 50999 Fax + (350) 200 47346 Tel: +(350) 200 47477 www.lloydstsb-offshore.com www.monarch.co.uk www.flymonarch.com

SUMMER 2008 GIBRALTAR INTERNATIONAL 3 Summer 2008 EDITORIAL COMMENT Volume 14 / Number 3 Contents Taxing Executive air travel gets Midas touch – Aviation 6-7 times If it doesn’t feel like a crime, t’s a fact of life that surely it’s not - Regulation 11 tax always will be Help on hand to protect an emotional against rising interest rates – Insurance 12 talking point, particularly Investing well aids charity Iamongst people in - Funds Investment 14 business. It is of little Effect of economic uncertainty, tax cuts surprise that even 10 and capital spending - Gibraltar Budget years ago when this special 16-17 magazine was launched, the threat of involvement of the European Union in Gibraltar’s Around & About - a round-up of own corporate tax setting was prominent. people & places 18 The argument was that Gibraltar should not Gibraltar companies set to remain set its taxes differently from those of the UK that an attractive option would amount to “material selectivity”. The matter has ended up with the European Court of - Corporate Services 20-21 Justice and a decision has long been waited. Big returns for start-up The tax exempt status for businesses is being – Brokerage 22 phased out and it will end in 2010. So Peter Caruana faced a difficult situation when setting Economic strength real driver for Gibraltar’s current year budget. His decision to property - Profile 24-25 speed up the planned reduction from 31 per cent Interest grows in customers to 27 per cent this time leaves him hedging his - Banking 28-29 bets. The UK corporation tax rate is 28 per cent, Everything and nothing changes so not too dissimilar to Gibraltar, but it’s left - Last Word 31 some businesses disappointed. They believe it’s inconceivable that the Court could single The Rock out when it has already ruled in favour the GIBRALTAR INTERNATIONAL MAGAZINE Azores being distinct from mainland Portugal. Others have felt the reduction now should Published by Gibraltar International No part of this publication Finance Publications Ltd. may be reproduced without have been steeper to signal Gibraltar’s confidence 1/5 Irish Town, Icom House, the written permission of in the Court result. As it is Caruana has simply Suite 6/PMB 104 the publishers. The PO Box 561, Gibraltar publishers have tried to said it should soon be 12 per cent, if not a ensure that all information preferred 10 per cent, believing there will Editor is accurate, but emphasise continue to be freedom to act. Ray Spencer that they cannot accept [email protected] responsibility for any errors The Isle of Man and Jersey of course, boast or omissions. The zero corporation tax, but other complementary Sales publishers accept no C.A. Tanner responsibility for measures, such as VAT, do add a burden, so it’s [email protected] statements made by not as straight-forward as it may seem. contributors or for any The decision to change tack so The Rock is Design claim made in an Bil Brooks advertisement. perceived as a low tax territory rather than a no [email protected] tax one must be right – all companies understand Gibraltar International Publisher Magazine is available on that taxes on profit must be paid – it’s a measure A.B. Tanner subscription, 4 issues of success. posted to: UK £24 - EU £32 A Court decision is needed to remove UK Agent: - Rest of World £44. The Lodge, Court Road, Maidenhead, uncertainty – and it’s needed now! Berkshire, SL6 8LQ © 2008 Gibraltar Tel: 0044 (0) 1993 703560 International Finance Fax: 0044 (0) 1628 630316 Publications Ltd.

4 GIBRALTAR INTERNATIONAL SUMMER 2008 AVIATION AVIATION

the eye of those supplying ships’ parts. London, and the City with the option of “Vital parts can be flown to a helicopter link to Battersea, rather than Gibraltar within a few hours rather than use the capitol’s major airports, as well Executive air travel waiting a few days for land delivery and as regional airports for a wider reach. clearances,” Paul enthuses, noting that it “If you want to be in for can cost a ship owner $US50,000 a day 4.30 pm on a Friday, we can make sure for a vessel to sit in port. More frequent you arrive at a time as close as possible and freight to get and larger cargo loads could be to that and in most cases there is no accommodated with the proposed difficulty in agreeing a landing time”, second cargo aircraft. Gibjets promises. International adminis- Although Gibraltar’s range of tration, aircraft maintenance and air passenger flights has increased since the crews are handled by Mayoral, which the Midas touch! recent Cordoba tripartite agreement on has gained a reputation for reliability aircraft and border matters, none seem and punctuality since being established particularly interested in freight business. in 1985. ven before the formal launch With the Falcon’s range of 3,000kms And with two hours or so notice, of its pioneer private executive and speeds of up to 900km an hour, Minister for Transport Joe Holiday private clients can be airborne from jet hire service for Gibraltar, the ability to fly with stops in different with Paul Butler at Gibjets’ launch Gibraltar such is the co-operation of the new company Gibjets was countries en-route can make the need to first take an aircraft from terminal’s management and ground han- putting together a business executive jet option a viable one. Gibraltar. dling teams. “Basically, how quickly can Eplan to add a second aircraft – this time However if a client wants to start out in UK destinations include Biggin Hill you pay us – as soon as we have the for the business freight market. Istanbul for example, then Gibjets will and Northolt for London to provide a money, the plane will be ready to go”, Anything from small packages to locate an aircraft in that area without the lower cost and speedier route into central Paul told Gibraltar International. components and machinery up to three tons payload could be considered with a minimum of three flights a week linking the Rock to European centres in Germany, Italy, Ireland and, of course, Still more flights on the cards as Spain and the UK. Described by some as “The man with the Midas touch”, Paul Butler, the Manchester reunites with ‘The Rock’ property developer and owner of fter a gap of just over two years, Peter Caruana, BA says it is looking at a European destinations”, he said. Queensway Quay marina, has linked low-cost airline Monarch is possible increase for next summer. As an example, the Government was with Malaga-based aviation experts re-launching services between BA took on the route after its former actively exploring with Iberia the possi- Mayoral Executive Jets to develop Gibraltar and Manchester, franchise partner GB Airways earlier this bility of an increase in frequency on private flights to and from The Rock. with a three flights a week year sold the Gibraltar connection to Gibraltar-Madrid services, which last They are targeted at financial and Aservice from after the summer. easyJet. Snr Porcel, who also met with year saw a reduction to two rotations per business clients in need of a personalised The move has been made possible by Gibraltar Tourist Board officials, con- week. and responsive service. the delivery of a new aircraft into the firmed BA’s commitment to maintaining The number of arrivals by air last Monarch fleet and services will operate the Gibraltar route for both Business and year was 179,267, an increase of 8.88% RIGHT FOR on Monday, Wednesday and Friday from Economy class passengers. over the previous year. 12 September, in addition to the airline’s easyJet committed to operating the Commenting on the re-launch of The Gibjets leased twin-engine e16,000 depending on the landing fees at THE FUTURE Gibraltar – London Luton and Gatwick 16 flights per week London Gatwick Manchester flights, Monarch’s managing Falcon 100 carries up to six passengers chosen airports. services. summer schedule that GB Airways had director of scheduled services, Liz Savage routinely anytime between 08.00 hrs and “We’ve had a couple of people Gibraltar’s proposed new airport But a spokesman for Monarch, already announced, making a total of 30 said: “We are delighted to be bringing 23.00 hrs, when the airport normally inquiring who thought it a bit expensive, terminal building will have separate which first started services to Gibraltar flights per week between Gibraltar and direct services from Gibraltar back to the operates, although for air ambulance but if you have to worry about the cost facilities for private jet passengers, eleven years ago, told Gibraltar the London area for the three airlines. Northwest. There continues to be huge needs the plane can take off and land by it’s probably not for you”, observes Paul, complete with VIP entrance, International that “no further frequen- The decision to re-instate the demand for flights from our customers, arrangement almost anytime night or who left Walthamstow in North-east personalised customs, police and cies or routes between the UK and Monarch service “followed the and this has been reflected by the number immigration facilities, Minister for day. London 27 years ago to run restaurants, Gibraltar are planned for Monarch at announcement by the Government of a of requests that we have received from Enterprise. Development, “Time is money to these people, who bars and hotels in Spain and Gibraltar. this stage”. new financial model for the airport that them over the past few years”. Technology and Transport, Joe value convenience and bespoke flight He was approached with the execu- Neither is British Airways planning would allow existing carriers to develop Manchester offered “a fantastic city- Holiday revealed. plans to suit their timetable of meetings tive jet idea and an outline business plan to increase its once a day flight between and expand their services to Gibraltar”, break destination and provides easy Speaking at the formal Gibjets often in more than one country”, that he didn’t bother to read for a few launch at Gibraltar airport in London Gatwick and Gibraltar this year, Minister for Transport, Joe Holiday, has access to the north of England”. explained Paul. weeks. But when he took time out he mid-June, he told his 100-strong nor extend to other routes. told Parliament. And money is the operative word: quickly found that the figures added up audience of business However, following a high-level “This new model should also More information on the cost of flights is not cheap. A return and Paul saw the potential for growth; representatives that “this is just the meeting in late May between Jordi encourage services from new destina- www.monarch.co.uk, www.ba.com, trip to the UK or northern Europe for hence the prospect of a dedicated freight sort of thing we need for the future Porcel, BA’s Iberian Peninsula Services tions. The Government continues in dis- www.easyjet.com and example, would cost approximately service, which for example, has caught of Gibraltar”. manager, and Gibraltar’s Chief Minister cussion with airlines that service other www.iberia.com/gb

6 GIBRALTAR INTERNATIONAL SUMMER 2008 SUMMER 2008 GIBRALTAR INTERNATIONAL 7 TOURISM Mini exhibitions to woo the UK regions

uch was the success of the Gibraltar Tourist Board’s teams in Brighton attracted agents from series of mini exhibitions and Gibraltar and London. across Sussex to focus on London dinners organised for the travel Gibraltar was represented by Gatwick flights, Birmingham, where trade in Brighton this spring, Blands, Parodytur, MH Bland, the Trade Minister Joe Holiday also attend- Birmingham and Manchester, Gibraltar Taxi Association, alongside ed, covered the Midlands with Luton Sthat the Gibraltar Government represen- the O’Callaghan Eliott, Caleta and Rock Airport featured, and Manchester tative office in London is planning hotels, and holiday firms Classic reflected the intended reintroduction of another – this time in Edinburgh. Collection, My Vacations and Cadogan, Monarch services to gibraltar“The “There’s a strong support for as well as Monarch Airlines. Gibraltar Tourist Board’s road shows Gibraltar in Scotland and the Edinburgh Most of the UK travel representa- are becoming one of the most effective event will build on that when promoting tives had not sold Gibraltar as a selling tools for Gibraltar’s tourism the range of travel opportunities to the destination previously and seemed sur- industry and the Government is happy Rock”, according to London Office prised at the range of attractions that to provide a platform through which director, . exist on The Rock, nor were they aware more visitors can be attracted to The Each time around 120 travel of the extent or quality of support Rock”, said The Hon Ernest Britto, agencies and their staff toured stands services, such as hotels and ground han- Minister for the Environment and promoting aspects of Gibraltar business dlers, Mr Poggio explained. Tourism. and attractions of interest to tourists. “Some still had the image of In response to current tourism The latest event in Manchester was Gibraltar as a garrison town and they trends, another Manchester event will be hosted by Minister for the Environment had not caught up with the 21st century held in September, specifically aimed at and Tourism, Ernest Britto, and the reality”, he told Gibraltar International. consumers.

8 GIBRALTAR INTERNATIONAL SUMMER 2008 REGULATION If it doesn’t feel like a crime, then surely it isn’t! Turn a blind eye at your own risk, warns Marcus Killick

t the climax of the early Bond they manage or whose account they hold at your door! movies there is a seemingly behaves in a way that is unusual to their Criminals love fall guys, particularly obligatory fight scene as the peer group? professional ones. They are, after all, so forces of good parachute They ignore the fact that cash arrives replaceable. For the wilfully blind, their /abseil into the villain’s lair from unusual places, odd requests for reputation and that of their firms is not Ato do battle with the hoards of evil powers of attorney are made, curious so easily recovered. henchmen. Meanwhile James just man- payments or payment mechanisms are A firm’s role in the fight against ages to save the planet and bed the girl. called for, volumes of transactions are money laundering and the funding of Watching one last week I couldn’t out of keeping with the alleged activity of terrorism does not end with initial help but wonder where did these the business. Even if the firm is doing identity verification, it is an ongoing henchmen come from? How were they wrong the provider of professional process. To disguise initial identity is not recruited? What attracted them to the services to them is not, so why worry? difficult; there are even websites that will job? Did they know they were the bad provide fake utility bills etc. What guys? cannot be disguised is the subsequent Perhaps until the final moments they activity. Due diligence is an ongoing, not were blissfully ignorant that they were a one off, process. part of an evil plan. Maybe Blofeld Not every unusual event is suspi- offered a great health plan, superb crèche cious, but it does require further enquiry facilities. Perhaps the staff canteen had a in order to determine whether the skilled chef. Maybe free stress relieving concern is real. Firms that make reports massages at your gun post were part of on the slightest deviation from the nor- the perks. mal activity of their clients, serve neither Hey, with all that, how could Sorry to be the bringer of bad news the client nor the enforcement authori- Blofeld, or Ernst, as he liked to be called to those who turn a blind eye, but, you ties. What is required is the exercise of by his team, be a criminal? Sure the lair too are committing a criminal offence, sound common sense. looked a bit anonymous from the outside and, you are often more likely to be In Gibraltar, the new Anti Money and a couple of odd things went on. But, prosecuted than those you believe you Laundering Guidance Notes have been as he said, lots of super villains were serve. designed to encourage such common doing the same thing, so where was the All financial firms, in every rep- sense. They are a move away from harm? utable jurisdiction, are required to report simple box ticking to requiring firms to There is a danger that criminal the suspicious activity of their customers. use their own judgement. Each firm is activity, particularly white collar That does not mean you need to know different therefore each needs to estab- crime, can be ignored, downgraded or that what they are doing is criminal lish procedures that are appropriate to dismissed by those that participate and merely that the activity would make a them. those that assist. They become wilfully reasonable person suspicious. Failure to As firms bed in the new require- blind to the truth. If it doesn’t feel like a do so can lead to a prison sentence. That ments, the FSC’s on-site visits will look at crime, then surely it isn’t. is even if the client is never prosecuted. how the firm has made the new The fight against money laundering Indeed you are at greater risk approach suitable to their own circum- also is hampered by the wilfully blind; because you are in the jurisdiction where stances. the lawyers, company managers, trustees the offence took place. We have worked hard with our and bankers who choose to ignore the The insider trader, market manipula- stakeholders to create a regulatory clues that they are being used by tor, fraudster or drug dealer may never regime that preserves Gibraltar’s reputa- criminals. If they ask questions at set foot in the jurisdiction where their tion and facilitates the growth of sound, all they accept implausible answers as crime occurred. They may have hidden sustainable financial services. Turning a credible. themselves through opaque corporate or blind eye does neither. After all they have done their initial trust structures (which you may have Marcus Killick is chief executive of due diligence, what does it matter to created for them). But you are there for Gibraltar’s Financial Services them that the activity of the company all to see. This particular paper trail ends Commission.

SUMMER 2008 GIBRALTAR INTERNATIONAL 11 INSURANCE

Help on hand to protect against rising interest rates After negotiations with the British government, an innovative policy is born to assist homeowners

orried borrowers who probably the first insurance product that Government believes that it is possible have seen their monthly requires no claims paperwork to be for companies to bring stand-alone mortgage payments rise completed. interest rate protection products to as a result of previous But the insurance only covers the market within the existing FSA fixed rate deals expiring, the lenders’ movements that directly definition of insurance and be classified orW lenders passing on their own higher correlate with a BoE move, not those as insurance for tax purposes.” costs of borrowing, have some good made independently by a lender seeking He went on to say: “These products news – at last. to increase margins. therefore, offer homeowners peace of A product that offers the same The Marketguard team is led by mind that their mortgage payments will protection as a fixed rate mortgage, but Nick Faulks, an actuary who established not go out of control, whilst allowing with more flexibility, is set to help an independent derivatives trading firm them to retain all the benefit of borrowers facing news of falling house nearly 25 years ago, along with Chris flexibility and freedom associated with prices and rising mortgage interest rates. Taylor (Chief Executive Officer) who variable-rate mortgages.” The new insurance product that has worked with Nick for nearly 20 The Government confirmed that the protects consumers against interest rate years, and Chief Operations Officer tax treatment of any claims payments rises is the result of more than three David Eccles. would be adjusted to ensure that the years work by the principals behind They, devised the new insurance product is not an investment and there- Marketguard Insurance Company product after consultation with HMG at fore Capital Gains Tax would not be and Quest Insurance Management Downing Street, UK Treasury, Inland payable. (Gibraltar) Limited . Revenue and Customs, as well as the Marketguard protects the insurance Marketguard is a recently licensed Financial Services Authority. company’s position by using FSA Gibraltar insurance company that will Gibraltar proved ideal for such an regulated wholesale money markets, be offering interest rate insurance innovative insurance company. Chris which are backed by the London initially to UK residential mortgage Taylor told Gibraltar International: “We Clearing House, a body owned jointly holders, and also UK commercial have been most impressed with the flex- by a collection of front line UK banks borrowers. ibility of response that we have received and insurance companies. Policyholders will be offered protec- from the FSC, which has worked closely “The quality of the level of protec- tion when the Bank of England Base with us to ensure that the finished article tion that can be bought, therefore, is of Rate goes up. Claims automatically will is one that is appropriate for all the highest order”, says Steve Quinn, be paid above an agreed excess point so concerned.” chief executive of Gibraltar’s Quest there is no need for a policyholder to The UK March Budget opened the Group and Marketguard’s managing make a claim. way for Marketguard’s introduction, director. Payments will be made directly into when Chancellor Alistair Darling stated: The Marketguard team believes that the policyholder’s bank account from ”Following engagement with market it can extend its offering to any other details provided at the outset, making it participants and the FSA, the product where it can protect itself via the financial markets and is already looking at what insurance to launch next.

probably the first More information on www.marketguard.co.uk, insurance not to require or contact Chris Taylor “ ([email protected]) no-claims paperwork or Steve Quinn ” [email protected]) 12 GIBRALTAR INTERNATIONAL SUMMER 2008 FUNDS MANAGEMENT Investing well aids charity

olidarity Fund PCC Limited Cell Company three investment funds as under this new Solidarity scheme it has just been established by separate Cells (PCC) each with a differ- happens automatically”, Liz Quinn, the Gibraltar-based Investors ent risk / return profile - a Money of Quest Fund Administration the International Forum (IIF) as an Market sub-fund and a Total Return scheme’s administrators told Gibraltar Experienced Investor Fund sub-fund with Lombard Odier Darier International. S(EIF) to provide very wealthy / experi- Hentsch Private Bank as investment Minimum investment levels will be enced investors with a return on their manager; and a Structured sub-fund 4250,000 or £250,000 depending on investment whilst, at the same time, under investment management of SG the Sub-Fund chosen and only those contributing to charity. Hambros Bank (Gibraltar) who meet the definition of Experienced IIF is a local association of firms Remar receives 10 per cent of any Investors can participate. and individuals committed to helping increase in net assets from investments Hassans has been retained as legal needy individuals in countries world- in The Total Return Sub-Fund and The advisors to the fund. wide. Its chosen charity is Remar Structured Sub-Fund under what is con- International, a Christian organisation sidered an innovative use of the highly More information on the Solidarity founded in 1982 to help people on the successful EIF structure. Fund from Steve Quinn, Quest Fund margins of society in more than 58 “It means people don’t have to Administration on www.quest.gi different countries. remember to put their hands in pockets and for the Remar charity Solidarity offers within a Protected to make charitable donations - on www.remar.org BUDGET BUDGET Effect of high oil prices, credit crunch and economic uncertainty to be ‘temporary and short lived’

The world faces economic challenges that Gibraltar’s economy is of economic and social development”, better placed than most to face and steer successfully through, Caruana declared. cent, but tourists spent nearly 10 per cent people, up by 7% in a year. For the current year the Government or £20 million more. There are now 100 licensed maintains Chief Minister Peter Caruana. conservatively estimates a lower The Government not only does not insurance operations. 60 in licensed com- Consolidated Fund surplus of £11.3 seek growth in the number of gaming panies and 40 in 6 licensed Protected Cell lmost all economic sectors “had Gibraltar had experienced some “This affects final demand in our million on broadly static revenue with operators, but actually curtails it through insurance companies. “The critical mass a good year and are poised to reduction in the level of structured trans- economy, especially in the real estate increases from income tax, import duty, a very selective and restrictive licensing that has been achieved in this sector now have another one”, whilst actions executed by the international and financial services sectors”, he rates and gaming and licenses being process, yet those firms too “had anoth- makes Gibraltar a mainstream insurance taxation rates continued to finance centre as a result of the world acknowledged. largely offset by projected reductions er good year”. In April there were 19 domicile within the European Union” fall significantly for all credit crunch, but the Government But he predicted that no from airport landing fees, Stamp Duty licensees compared to 16 a year earlier, Caruana noted. Apayers, Chief Minister Peter Caruana expected the adverse effect on the level of significant job losses would result, even and Tax Exempt Company receipts. but Government revenue from remote In addition, there are 33 investment told Parliament in June when presenting business “to be temporary and short though there will be “further adjust- The Government limit on borrowing gaming tax rose by nearly a quarter to firms, 32 Experienced Investor funds, 12 the 2008/09 Budget – his 13th and first lived”. ments, caused mainly by consolidation fixed by statute, at £100 million since reach £8.2 million last year. Protected Cell funds companies, 86 trust in his current fourth term of office. Mr Caruana, who is also Minister and reorganisation”. 1988, (when GDP stood at £208 million) The financial services sector contin- and company managers, and 18 banks “The economy of Gibraltar remains for Finance, noted that “the vertigenous In the 2007/8 financial year, is to be raised. Currently it stands at £93 ued to grow as vital segment of the with total assets of £11 billion, and funds strong, buoyant and growing at a high, rise in the price of oil, the credit crunch Gibraltar had an income of £280.7 million, less than 12 per cent of forecast Gibraltarian economy; employing 2378 under management of £10.3 billion. but sustainable rate”, he declared. and the uncertainty as to whether the million overall leading to a surplus of 2008 GDP, and net public debt at £43 Public finances were in healthy sur- world economy will fall into a recession” £15.5 million, equivalent to 6 per cent of million is just 5.5% of GDP. plus last year “in the face of changing, would affect worldwide economic overall expenditure and slightly less than Assuming a growth rate of 8 per cent and sometimes challenging global trends activity, and in turn, the willingness and expected. in the year to March, the Government Taxes cut with and dynamics, which require us to be ability of people to spend, invest and do Public debt of £93 million remained forecasts GDP now stands at £800 alert and willing to change and react”. deals. static and has now fallen to less than 12 million, although it believes that eco- more to come! per cent of GDP, compared to the UK’s nomic growth last year was around 10 Corporation Tax for Gibraltar compa- nomically desirable, to keep outdated, around 40per cent and the EU’s per cent and that it will be maintained nies has been reduced by 6 per cent to a unviable and unprofitable business convergence maximum of 60 per cent. during the current year. new low of 27 per cent – a year earlier models afloat by public subsidies, Mr This enables the Government for the Inflation during 2007 was 2.6 per than expected. Caruana maintained. However, he felt Capital spending to next few years to part finance an exten- cent mainly through price inflation in the Based on previous Government justified in keeping policies that protect- sive capital investment programme “that UK and Spain, which together supply 80 statements, the business community had ed the international competitiveness of ‘transform’ The Rock will take Gibraltar to a new, higher level per cent of non petroleum imports. The annual inflation rate is forecast to remain expected the 2008/09 rate to be 30 per otherwise viable businesses. Gibraltar stands on the threshold of an infrastructure needs. above 3 per cent for much of 2008. cent. And a further reduction is “Such businesses will benefit in a unprecedented phase of public invest- Funding will be a combination of However, “a drop in interest rates, a envisaged for the next tax year. deep and meaningful way from the move ment in infrastructure and amenities, the reserves, re- investment of the proceeds weakening of the Euro, or a fall in the The real aim is to set Corporation soon to very considerably lower the rate scale and breadth of which “will truly from selling Government property and9th in the price of oil, all of which are distinct Tax at between 10 and 12 per cent from of corporation tax”, Mr Caruana added transform Gibraltar and ensure that it assets, the use of private finance initiative possibilities later in the year, would result 2010, and Peter Caruana, the First during his Budget speech. will be a modern, prosperous European funding models and an increase in in a reduction in inflationary pressures” Minister emphasised: “My strong prefer- After last year’s substantial cuts in city well into the foreseeable future”. Government borrowing. world Caruana pointed out. ence will favour the bottom end of that personal taxation, further, more modest range”. tax reductions will follow, targeted at the But no-one could say what the fore- Together with three major privateThe International Monetary Fund Imports (excluding petroleum prod- These moves are in anticipation of a lower paid , working pensioners and cast spend will be in total or in this finan- sector developments - Ocean Village,would place Gibraltar in ninth place in ucts) grew by 16 per cent to £426 million cial year, at the time Gibraltar Eastside and Midtown - underpinned successful outcome to the Government’s businesses. world rankings of National economies, with just under a third coming each from International went to press. Tenders had by the Government, the Chief Minister appeal to the European Court that it The top rate for tax payers on the in terms of GDP per capita, the usual the UK and Spain, and exports increased reached a ‘delicate’ stage. However, last Peter Caruana believes “this capital should be allowed to continue setting its Gross Income Based System was reduced measure of a country’s prosperity. similarly to £151 million. year’s capital spend was £31.3 investment programme will propel own taxation levels, rather than be tied by 2 per cent to 38 per cent. The Rock is tenth in the World million, the second highest since 1996. Gibraltar into a new phase, a new level, to the UK rates, as the EU has proposed. Unlike the UK, Mortgage Interest Bank’s list, in respect of the 2007 and Construction of a new air terminal is of socio economic prosperity”, “Our cap- (UK small companies’ pay Corporation Relief Allowance (Miras) for home 2006 economic figures, respectively. planned to begin in September - a ital investment programme will ensure TOURISM GROWS TOO Tax at 21 per rising to 22 per cent in purchase, but no longer for “very high Gibraltar’s high socio economic Government flagship project - and a that Gibraltar becomes and remains a Arrivals across the land frontier 2009/10, and for enterprises with profits income earners, in respect to very prosperity is also seen by reference to a month or so later work will start truly modern and successful European increased by nearly 15 per cent to 9 over £1.5 million the rate has been large mortgages, to purchase very recent World Bank survey that ranked on a new frontier road and a society, and will address many tradition- million people; those by sea rose 30 per reduced to 28 per cent.) expensive, luxury properties” – for new Gibraltar fourth in the world in terms of tunnel under the airport runway. Some al problems, such as housing, parking, cent to 292,675; and there was an 11 per It was not the Gibraltar buyers it’s now limited to loans up combined political stability and investment will satisfy The Rock’s basic roads and traffic schemes”, he asserts. cent rise in arrivals by air to 159,666. Government’s function, nor was it eco- to £300,000. economic prosperity. Hotel nights sold rose by just 4 per

16 GIBRALTAR INTERNATIONAL SUMMER 2008 SUMMER 2008 GIBRALTAR INTERNATIONAL 17 PEOPLE AND PLACES

‘Top Lawyer’ centre, leading drafting teams worked at NatWest for eleven on anti-money laundering, years, previously as a head chef of the Caleta Hotel, and top firm banking, insurance, financial Relationship Manager in the and within days was subjected services, tax and trust corporate banking accolades to close scrutiny by inspectors legislation. division, and a for the AA James Levy QC, Despite all that, NatWest Branch before they senior partner in Levy still spends at Manager. happily Hassans, least 20 per cent of his In other RBS reconfirmed Gibraltar’s time on pro bono legal International moves the restaurant’s largest law firm, work for Gibraltar Gerald Rodriguez (37) two Rosettes has received a people of all walks of has been appointed as status. ‘Life Time life that need advice. head of treasury & With Achievement’ investor solutions (TIS) 30 years Award from in Gibraltar. He Joining RBS experience in legal publishers worked at Credit catering, his Chambers & achievers Agricole Indosuez on Gerald Rodriguez formative Partners, in James Levy QC Marvin Cartwright, The Rock and in eleven years conjunction head of corporate Geneva, where he ran the working with with Lex Mundi. banking at RBS International Forex and Treasury desk and Mexican, French, Oriental He added to the accolade in Gibraltar, received the RBS also set up the investment and Fusion cuisines in of being the only lawyer in International’s prestigious team. But in the immediate California’s Napa and Gibraltar to have been rated ‘Yellow Jersey’ award for best past, Rodriguez spent four Sonoma valleys, and in Long “Star Performer” by financial performing corporate years establishing the ABN Island New York as a tempura Chambers and Legal 500 for banking region being “well Amro Private Client chef for a traditional Japanese three years in a row and a ahead of budget”. Investment team with one-off listing in “Top 100 restaurant, Foster went to Lawyers in the World”. England before moving to An Honours graduate Tenerife including six years as from Manchester University, a chef-proprietor. Levy attended the Council of Accommodating Around The 4-Star Rock Hotel’s Legal Education in London and immediately after being Alfred Rodriguez, executive admitted to the Bar joined chef for more than 20 years, Hassans founder Sir Joshua was also rewarded with two Hassan, a former Chief AA Rosettes for dining for the Minister and political leader About second successive year, having of Gibraltar for 40 years. previously gained similar At the same time Hassans regular recognition under the then RAC scheme for the 120 is one of six firms nominated He accepted the award in responsibility for investment seat restaurant. for recognition as the best of only the second& year of entry advice to private clients and Plans are afoot to update the world’s off-shore law at the Regional Corporate monitoring of discretionary many of the facilities at the 76 firms. The award measures Banking Dinner in London portfolios. years old Rock Hotel and achievement and standing before around 500 To complete A Mediterranean haven offering all the nostalgia of home, Gibraltar include creation of a spa against hundreds of legal firms representatives of RBS the RBS International facility and the has been accommodating its visitors for centuries. The vibrant city in the world’s major offshore offshore TIS team, possibility of centres and is based not only jurisdictions. Kerry Graham centre encased within original city walls is a living heritage where undertaking civil on Chambers’ assessments, Francesca joins as weddings. Gibraltarian warmth and friendliness abounds. A range of activities but those of the world’s Cartwright, assistant largest international Marvin’s wife treasury on land and at sea will excite both young and old. association of independent who has manager and Going lawyers, as well as the returned to also was at For further information, contact opinions of the firms’ peers NatWest – ABM Amro as for golf and clients. another part of Assistant Nearly 100 GIBRALTAR Levy, who took silk in RBS – after a Investment Kerry Graham friends, Duke of Kent House, Cathedral Square, Gibraltar 2002, advises large public year’s Manager with wide business companies on mergers and maternity experience in handling associates, existing and Telephone: +350 20074950 Fax: +350 20074943 acquisitions and property leave, has been Francesca Cartwright treasury deals and prospective clients of Email: [email protected] www.visitgibraltar.gi companies on acquisitions appointed as its new Business structured products for Private Gibraltar and Spanish offices throughout Europe and the Development Manager in Banking clients. of law firm Triay & Triay and firm has links with all the Gibraltar. its associated wealth MADRID major London, Continental, She is tasked with management and Trust Torres de Colón, Torre 1-Planta 3ª A, Plaza de Colón 2, 28046 Madrid US and Israeli law firms, with developing Premium Banking business, Totus, attended the around 75 per cent of business and mortgage business, as well firm’s annual golf day at The Telephone: +34 91 559 6259 Fax: +34 91 559 7470 related to international clients. as local community Caterers get San Roque Golf Club. Email: [email protected] www.visitgibraltar.gi For many years he has investment and public fresh awards Managing Partner Melo been prominent in helping relations activities. Irish/American Mike Foster Triay presented prizes over LONDON develop Gibraltar as a finance Ms Cartwright has lunch at ‘El Bolero’ has taken over from Gregory 150 Strand, London WC2R 1JA Martin’s five year stint as restaurant. Telephone: +44 (0) 20 7836 0777 Fax: +44 (0) 20 7240 6612 Email: [email protected] www.visitgibraltar.gi 18 GIBRALTAR INTERNATIONAL SUMMER 2008 CORPORATE SERVICES CORPORATE SERVICES

finance centre. There are several dozen countries or territories worldwide - from even the most sophisticated clients a full requirements and any structure should Alderney to Vanuatu - where inter- range of services, either using their own be individually tailored so that the objec- Gibraltar companies national companies may be established. staff or, perhaps, in conjunction with one tives can be achieved in full. Time and So why pick Gibraltar? or more of these internationally known effort expended at the start of a new The first consideration is the juris- firms. relationship should ensure that what is diction itself. Gibraltar benefits from its Generally this can be done at a more put in place today is likely to remain set to remain an competitive price than some of the juris- effective for years to come geographical location. For centuries Gibraltar has been strategically impor- dictions with which Gibraltar competes. This is a fast-moving world, so it is tant and this is still true today within the When considering setting up a vital that the professional firms with attractive option? context of the global financial services corporate structure, a key decision is the whom clients choose to work are able to industry choice of corporate service provider. stay abreast of changes and remain in a All Gibraltar corporate service position to advise at every stage. The challenge for corporate service providers may soon be to promote Gibraltar Europe is halfway between the tiger economies of the Far East and the US. providers must be licensed by the Enviable reputation Being in the Central European Time Gibraltar FSC. A check on its website as a “low tax”, not a “no tax” jurisdiction. There are some important and positive, In setting out the current position, I have Zone, Gibraltar is well placed to work www.fsc.gi will confirm a firm’s status. also given some pointers on the possible changes to come, argues Ian Le Breton. with clients from all over the world for at Good reputation and experience can be changes we may soon see. This is a fluid least part of anyone’s working day, just as important as the range of services orporate services, includ- the accession by the UK to what was situation and, by the time this regardless of where they happen to be. offered. ing the establishment and then known as the EEC, or more article is read, further detail on the long Clients also need to consider the way Prospective clients often require a management of Gibraltar colloquially, the Common Market. awaited ruling from the European Court in which an international finance centre structure that involves companies, trusts companies, remain a key Gibraltar is not part of the Customs of Justice may be known. is regulated. Gibraltar is second to none or other entities established in other component of the finance Union - hence there is no VAT. But it is clear that these are exciting in this regard. No less an authority jurisdictions, in addition to the establish- Cindustry offering and major changes EU membership means that times for our industry. Gibraltar has than the International Monetary Fund ment of a Gibraltar company. A world- to Gibraltar’s company tax regime Gibraltar-regulated firms are able to developed an enviable reputation in the recently recognised Gibraltar’s Financial wide network of offices and agents can are on the way. “passport” their services across international finance world and, in Services Commission as first rate provide a distinct advantage. recent years, has also shown an ability to This is particularly important the 27 member states that make Clients, or their advisors, should adapt swiftly to changes imposed on all when considering the use of a up today’s considerably expanded check a corporate service provider’s web- international finance centres by external Gibraltar company as part of a cor- Union. Telecoms is vital site - assuming it has one - to look at the bodies such as the OECD and the EU. porate structure. The proposed new maximum All financial services companies doing wider picture. The European ruling and possible The traditional Gibraltar tax corporate tax rate of 12 per cent will business on The Rock must be licensed - Finally, it’s worth noting that the much lower tax rates are going to have exempt company is no longer avail- enable Gibraltar to compete with before setting up shop - and the regulator time when offshore companies could be an impact, for sure, but I am confident able to new entrants. Following other low tax regimes in the EU, monitors their business on a regular established at very low cost and without that they can be used to further pressure from the European Union Ian Le Breton welcomes proposed new tax structure such as Cyprus where the rate is 10 basis. My view is that whilst Gibraltar is much attention to detail is long gone. Gibraltar’s international reputation. (“EU”), no further tax exempt cer- per cent for example extremely well regulated - it is not overly Corporate structures should be Gibraltar is a small place but, as I tificates have been issued since June 1 July is 27 per cent - down from the In this proposed new situation, the so. Businesses can, therefore, get on established with great care, particularly tell my international clients, it punches 2006; those that remain will lose their 30 per cent proposed a year earlier! challenge for corporate service providers with their work knowing that their in respect of ancillary services such as well above its weight. The future is tax exemption by 31 December 2010 The intended reduction to less than may very well be to promote Gibraltar as competitors are similarly controlled. shareholder, consultancy and other legal bright and I look forward to the new Instead, the Gibraltar government is half this new corporation tax rate within a “low tax”, not a “no tax” jurisdiction. Telecommunications is a vital area in agreements. All this takes time and costs challenges with enthusiasm. proposing to introduce a new low tax a couple of years would be a substantial So there are some important changes to the 24-hour business world in which we money. regime, full details of which are not yet step forward. come. now work. Again, Gibraltar benefits Whilst a client should rightly be Ian Le Breton is managing director available. But in the 2007 Budget, Chief The current test as to whether from a state-of-the-art network - without looking for the best value, a cheap of Sovereign Trust (Gibraltar) Limited, Minister (and Minister for Finance) Peter Gibraltar companies are liable to local it, The Rock would not have been able to and cheerful approach is not to be A wide choice a firm specialising in offshore Caruana indicated that the corporate tax corporate tax depends on a number of attract the international offshore gaming recommended in our industry. Finance service providers await the new companies, trusts and tax planning. rate to be applied should be no higher factors, including the “mind and man- operations that now play such an Every client will have different regime with great interest. The issue of than 12%. agement” rule. Put simply, if a Gibraltar important role within the financial concern is whether Gibraltar is likely to The implementation of the new tax company is managed from the Rock - community. remain a good place to set up corporate regime depends on a long awaited ruling even if little or no business is actually Perhaps of most importance howev- structures, and this will be even more from the European Court of Justice. In transacted in Gibraltar - local taxation er, are the people in the industry. The important once the new tax changes have simple terms, Gibraltar is seeking the could apply. It remains to be seen how majority of firms in Gibraltar are likely been announced ability to continue setting its own levels this may change under the new regime. to be able to deal with clients in at least Start-ups grow My personal view is emphatically of corporate tax. In the absence of this Once the European Court has ruled, two languages - Spanish, as well as “yes” - I believe Gibraltar can only ben- ruling at the time of writing, no-one the proposed reduction is likely to mean English - although it is not hard to hear A total of 71 start-up companies were sector for day-to-day matters concerned efit from the new system although of knows just how any new proposed that after 2010, Gibraltar companies will many more European languages being assisted by the InvestGibraltar Office with establishing new firms. course we need to wait for the detail. But system will work in practice. pay the new, lower rate - as mentioned spoken. and a further 31 have been helped in the The number of jobs in the whole of why am I confident about Gibraltar’s However, in his latest June Budget above, it is to be hoped that this rate will The Rock is also well served by a first half of this year, according to the finance centre last year grew by 7 per future in relation to the provision of statement to the , be no more than 12 per cent. network of world-class banks, lawyers Government statistics. cent to reach 2378, , equating to around corporate services? Mr Caruana advanced the reduction in Gibraltar enjoys a special status and accountancy firms. Gibraltar-based The InvestGibraltar Office is the one in eight jobs in Gibraltar. Legal Importantly, consider the prime Corporation Tax so that the rate from within the EU, joining in 1973 as part of corporate service providers can offer frontline organisation acting as a bridge activities accounted for 224 jobs and criteria for choosing an international between the Government and the private accountancy for 265 jobs in 2007/08.

20 GIBRALTAR INTERNATIONAL SUMMER 2008 SUMMER 2008 GIBRALTAR INTERNATIONAL 21 5P SFBMMZ NBLF ZPVS NPOFZ XPSL IBSE ZPV OFFE BROKERAGE B SBGU PG MBXZFST BTTFU NBOBHFST JOEFQFOEFOU A*TOUJUUJNF GJOBODJBM BEWJTPST BOE BDDPVOUBOUT 5IF QSPCMFN JT GFX PG VT IBWF UIF UJNF PS QBUJFODF UP NBOBHF TVDI UFBNT PS SFTPMWF Big returns for start-up TPNFPOF QPUFOUJBMMZ DPOGMJDUJOH BEWJDF 5PUVT DBO IFMQ JO UXP TJNQMF XBZT ingapore, New York, Chicago, Refco subsidiary of one of the US’ just days after completing the buyout Sydney and London have largest businesses. from the Dutch who had “changed their attractions, but it was Now with co-director Andy direction”.  8F CSJOH BMM UIFTF TLJMMT VOEFS POF SPPG Gibraltar that provided the Beckwith at the Queensway Quay Although fronting the marina, Quay CMFOEJOH UIF UBMFOUT PG MBXZFST BTTFU NBOBHFST right combination of business offices, they are utilising Gibraltar’s Financials has a team of nine people and XPSLFEJO JOEFQFOEFOU GJOBODJBM BEWJTPST BOE BDDPVOUBOUT UP PGGFS B TFBNMFTT TFSWJDF XJUI FYDFQUJPOBM Sopportunities and lifestyle for Philip Experienced Investor Fund (EIF) status promises a transparent fee structure Docker to open The Rock’s specialist as “a superb opportunity” to launch an within an entity that is Regulated at DMJFOU GPDVT BOE [FSP DPOGMJDU broking businesses dealing directly on Investment Management division and every stage. Utilising its Discretionary global markets for professionals and offer a range of hedge funds that hold Investment Management licence to  " EFEJDBUFE DMJFOU MJBJTPO NBOBHFS JT ZPVS institutions. out the prospect of consistent and set-up a Protected Cell Company (PCC) ZPVSCFTU TJOHMF QPJOU PG DPOUBDU FOHBHJOH UIF SJHIU TLJMMT Quay Financials (Gibraltar) Ltd, a attractive high returns for investments of as an umbrella structure, five single BOE XPSLJOH JO ZPVS CFTU JOUFSFTUT BU BMM UJNFT Category 1 FSC regulated Broker, with e100,000 and above. manager hedge funds have just been its main trading screens running through “To achieve this level we are focus- launched, with three seedling funds )FBERVBSUFSFE JO (JCSBMUBS 5PUVT OPX EFMJWFST London data centres, has been born out ing on emerging, younger managers who projected. CFTQPLF QSJWBUF BOE DPSQPSBUF XFBMUI of the former year-old Van der Moolen want to be known for their success in “We are in a perfect position to JOUFSFTUT  NBOBHFNFOU TFSWJDFT UP NPSF UIBO   (Gibraltar) Ltd brokerage as a result of a achieving great returns, rather than launch an investment hedge fund for any DMJFOUT 0VS TFSWJDFT JODMVEF business buyout just completed. known for the huge amounts of funds approved trader providing a set-up for A broker with 30 years experience under management as is the case with hedge funds “out of the box’ using the 5PUVT $PNQBOJFT  5SVTUT in futures and derivatives with a 14- most other funds managers wanting to EIF and PCC structure for £15,000, 7JODF%F4UFGBOP 5PUVT.% strong team in London, Docker previ- stay within their own comfort zone”, much less than generally available for t BDDPVOUBODZ TFSWJDFT ously had businesses in those other cities Docker told Gibraltar International. stand alone funds”, pointed out Chad t FTUBCMJTINFOU PG QSJWBUF after developing Easyscreen, a front-end “They are investing their own Thomson, Quay’s 27 years old head of CBOLJOH TFSWJDFT trading system and risk management money along with those of clients, which sales, who for the second successive year, t DPNQBOZ GPSNBUJPOT BOE system that he sold to the now defunct is a very big difference”, he explained captains Gibraltar’s Rugby Club. NBOBHFNFOU t USVTU BOE USVTUFF TFSWJDFT t MFHBM TFSWJDFT 5PUVT 8FBMUI .BOBHFNFOU t UBY QMBOOJOH Why Advertise in t BTTFU NBOBHFNFOU t QSPQFSUZ GJOBODF t GJOBODJBM TFSWJDFT Gibraltar International? 5P GJOE PVU NPSF QMFBTF WJTJU PVS XFCTJUF 0S UP UBML UP VT EJSFDU QMFBTF FNBJM PS UFMFQIPOF VT UPEBZ ● 10,000Circulation ● 3500 mailed to selected financial advisers, bankers, senior figures XXXUPUVTDPN 5PUVT  ZPVS HVJEF GPS ZPVS XFBMUI KPVSOFZ working in financial services and wealth management sectors in Europe and the Middle East ● 800 mailed to villas and prestigious addresses in Sotogrande ● 1000 mailed to high net worth individuals ● Distributed in Gibraltar’s leading Hotels, Arrivals, Departures and Executive Lounge at Gibraltar Airport ● All the major drop off points in Sotogrande and San Roque UPUVT ]  JSJTI UPXO ] HJCSBMUBS ● U    ] F  FORVJSJFT!UPUVTDPN 100 mailed to the Gibraltar Government Office, Washington DC. USA

22 GIBRALTAR INTERNATIONAL SUMMER 2008 PROFILE PROFILE

were bought by people who never expected to live in Now he’s added virtual them. Those speculators tours of apartments such as now left saddled with sever- with Kings Wharf and The al units have to reduce their Anchorage. And his in-house Economic strength real expectation if they are to magazine backs up the mar- have any chance of off- keting presentation. loading them now. And With a family history that this can give the mistaken goes back to Italian and even driver for property impression that prices are Irish origins, Louis is looking falling. “They still remain to grow still more. He has Ray Spencer finds out why marketing consultant Louis Montegriffo above their purchase price” seen BMI expand into the And BMI, a new busi- Sotogrande market in particu- remains keen on bricks & mortar. ness to Gibraltar in 1998, lar to capture the more stable should know. A year after high-end property market and opening, the firm began t wouldn’t seem true if an estate years ago the British Ministry of Defence is seeking to tap into other promoting a new develop- agent admitted that the property was the mainstay of the local economy, aspects of the investment ment - Sunset Close, a market was not on the up. After now The Rock is self-sufficient. package through a new asso- group of 25 town houses in Artists impression of the finished 19 storey Quay 27 development at Kings Wharf all, it’s the job of estate agents to Since the early 90’s there has been a ciated company, BMI Wealth, the South district of Gibraltar - and since talk up the sales potential. And four or fivefold increase in property with colleague Paul Astengo then has been responsible for marketing ILouis Montegriffo of BMI Group is prices, which has very much been a catch sales. “It took me by surprise, not formerly a Barclays Bank mortgage man- eight further new projects, including no exception. up process to the rest of the world - (in because I’m not good at presenting the ager. Europlaza, Atlantic Suites, The However, rather than spouting so southern Europe at any rate). However, developments in a positive and realistic Normally this aspect would be out- Anchorage, being completed this year, much blah, blah, his conviction about whilst the market may have reached a way, but the extent to which BMI was sourced, but the aim now is “to leverage and Kings Wharf’s Quay 27 now under the underlying strength of property temporary plateau, Louis looks to other chosen to market the properties”, he our existing client base concerned with construction. investment on The Rock is very well financially strong centres such as Jersey, says. the Gibraltar real estate business guiding Now the company is involved (as defined. Guernsey and Monaco, where the He considers himself very able in his these clients on a variety of complemen- marketing consultants) with the promo- As the organisation that lays claim significant numbers of financial services role as marketing consultant and in tary areas of financial advice, including tion of Quay 29 expected later in the to the sale of more than 40 per cent of staff have helped fuel a healthy interest in particular the creation of web sites special financing packages, protection year. This will be the second phase of the Gibraltar’s luxury units in the past bricks and mortar. specific to prime developments that give and investments.” Kings Wharf development, adding a fur- decade, BMI would seem to be well Whilst residential space costs are a realistic impression of what is proposed ther 140 units. Strength of economy placed to size up the current property £14,000 or more per sq metre and then regularly up-dated to record From the outset, Louis Montegriffo As Louis notes: “The benefits of diversi- situation. in Monaco, compared to Gibraltar’s progress. “In that way, buyers or sensed the danger in concentrating too fying revenue streams and providing a The continuing economic strength of average of £4-5000, he doesn’t see investors considering the particular greatly on speculators and targeted the broader based proposition will result in a Gibraltar is the real driver of the proper- prices escalating as a result. scheme are able to gain almost enough Louis Montegriffo is optomistic marketing effort on owner- more robust business model and ty market and in real terms not affected Indeed Montegriffo, who has virtu- information to purchase online. occupiers - “people who had greater opportunity for sustained like the US and UK where the credit “a recipe for disaster” - when local banks ally learned his marketing trade on-the- done their sums and who want- growth.” crunch and over stretched mortgage and building societies were sticking to job during his 10 years with BMI, does ed to see the project succeed and Denying he might simply be books have taken their toll, he believes. four times earnings as a maximum. see some evidence of short-term soften- to move in themselves”. talking the market up, Louis True, all banks and building societies This has helped to guarantee The ing on asking prices with a fluidity of 3- counters: “Let’s see Gibraltar for will from now on be protecting their Rock’s property portfolio and placed 6 per cent to allow for negotiation poten- what it really is and look to the mortgage book and taking a cautious Gibraltarian home owners generally in a tial. But he is convinced demand remains strength of this economy and the look at their future lending, but stronger position than those in the US and based on Virtual tours attractive proposition for com- Montegriffo argues that that is what the and UK. current comparables with The Anchorage development panies to set up business and Gibraltar financial services sector has He points to the fact that 15 years other jurisdictions the outlook remains where the 106 units sold well relocate to this part of the instinctively done throughout. Some ago only 5 per cent of the Gibraltarian positive. he says, simply because they world.” mortgage providers abroad were lending community owned their own property; represented good value for He adds ruefully: “If we up to 10 times personal income - today its 55 per cent. And whereas 15 Speculators left saddled money. There, over 50% of the could get a favourable ruling on “Some developers upped their prices too sales were to owner-occupiers. the European Court case over high on the back of strong demand from “In Spain, it was different. our taxation policy, then it investors looking to turn over their Fifteen years ago there was high would act as a spur to companies money on a rising market. In fact, after demand for 2-bedroom apart- not wanting to get caught with the initial deposit, they didn’t consider ments and developers built their pants down having made the need for having to fund the actual thousands, all similar in size, Four or fivefold rise since 90’s the commitment on the strength “ purchase because the unit was expected style and presentation, with few that things will stay the same. to be sold long before at a much higher buy to live takers”, he observes. as prices catch-up with We have every reason to believe price”, he observes. Candidly, 35 years old it will, but some will under- Louis estimates that in certain devel- Louis admits he never expected rest of Europe Half of The Anchorage sales to owner-occupiers standably need to be assured!” ” opments, up to 80 per cent of properties to be so successful in property 24 GIBRALTAR INTERNATIONAL SUMMER 2008 SUMMER 2008 GIBRALTAR INTERNATIONAL 25 Telephone +(350) 200 46328 Email [email protected] Web www.bespokexecutive.com

26 GIBRALTAR INTERNATIONAL SUMMER 2008 BANKING BANKING An oasis... Summer change for customers Ex-pats to be targeted New ground for in a busy world bedrooms The bank that claims to have the most manager for Lloyds TSB Bank 104 Bedrooms and suites in a colonial Initially, the bank has a staff of 19, asset finance style all with a sea view UK personal current accounts, Lloyds (Gibraltar) Ltd. but to meet expansion plans beyond the TSB, has chosen Gibraltar as the base for “Ex-pats who move away from present 15,000 Lloyds TSB European Meanwhile fellow RBS International member, Lombard, has conference facilities the launch of its campaign to woo their home country sometimes consider customers , Johnson expects to employ opened a new branch in NatWest House to become the first Full upgraded conference facilities ex-pats of all nationalities across Europe transferring their bank to one in their available for board meetings, training ten more people by year-end and up to asset finance provider for business related equipment, aviation with a mix of specialist investments and new home country. But people like to courses and presentations 60 within two or three years. finance and marine finance. accounts - both current and deposit. stay with what they know and trust, so Speaking at the launch Gibraltar’s Chief Minister, Peter Internet They will for example, be able to the new bank in Gibraltar allows us to Cross-border Caruana, commented: “Lombard’s focus on providing FREE Wireless broadband available operate accounts in their country of provide services direct to them wherever Having flirted with opening a Gibraltar alternative finance solutions that suit businesses’ exact needs is throughout the hotel and an internet room for our guests to use residence and pay currency, and convert in the EU they are located”, he bank whilst with The Bank of Ireland clear and having them on the Rock will no doubt help our local to or from Sterling or Euro without explained. seven years ago, he retained the idea. businesses continue to succeed.” weddings charge. After joining Lloyds TSB four years ago Lombard has grown to become the UK’s leading direct The Rock is an ideal wedding venue The new operation - Lloyds TSB Serious regime and as part of his remit to target expatri- provider of asset finance over a wide range, including cars, whether it be a small intimate wedding International as it is known – has opened or large family gathering. We are also a Mark Johnson, the Bank’s managing ate bank accounts, he opened branches commercial vehicles, plant and machinery, IT and telecommuni- in revamped premises in Main Street, recognised venue for civil marriages director, spent two years researching in the US, Cyprus and South Africa to cations as well as general aviation and marine. and ceremonies can now be conducted and can passport accounts across the EU, different jurisdictions, including Cyprus, complement the traditional operations in Richard MacNee, Lombard Gibraltar area director, added: in various parts of the hotel making it possible for ex-pats who move Luxembourg and Malta, before deciding the Isle of Man, Jersey, and The Middle “By linking products and services to those offered by other countries for work or to live, to retain a Swimming Pool to establish the Gibraltar operation. and Far East businesses in The Royal Bank of Scotland Group, a seamless single bank account and a relationship service is offered to address a diverse range of finance Outdoor swimming pool with pool “The existence of an international But the EU accounts for 40 per cent side bar and pool side menu. We they understand. banking culture – and not just for high of the UK’s ex-pats, so being able to requirements”. welcome private pool membership, Current accounts will earn interest our lido club, with private pool hire net worth individuals – as well as access provide from Gibraltar cross-border (at the time of writing) of up to 3. 85 per for parties and barbecues to the UK Clearing system were part of banking products – initially adapted cent on daily balances with money the reason for being here”, Johnson told from the Jersey product suite - was a Restaurant market deposits paying up to 5.47 per Gibraltar International. “The Rock has distinct advantage. The restaurant has stunning views cent. Minimum opening balances are a helpful, but rigorous regulatory Spain, Portugal and France represent One plus one over the bay. Our “house” menu is “100 of whatever currency you choose – excellent value for three courses process, which establishes itself as a the initial target areas in addition to Pounds, Euro, Dollars”, explains Warren including an aperitif Manzanilla, serious regime, as well as being close to Gibraltar itself, but the offer is pan- costs £2m more olives and coffee. A full á la carte Maye, senior business development key markets”, he added. European. NatWest has just spent £2 million on improving customer serv- menu along with a superb eclectic ices and facilities for its staff by extending into a second, adja- wine list is also available cent block on Line Wall Road, Gibraltar, with a foot bridge link- wisteria terrace ing both buildings. The Wisteria Terrace for lunches, The new premises at No 55 add nearly 700 sq mtrs of space dinner, barbecues, afternoon teas, Expanding on-line service for more meeting rooms to give increased customer privacy, rela- evening drinks and informal dining tionship managers across all divisions based in the same build- As the Summer Issue of Gibraltar through its relationship with Barclays Online banking with new, and in many Barbary bar ing and access to more ATMs at the existing NatWest Building International was being published, Capital, the European investment bank instances, higher rates of interest, Barbary Bar and terrace for a internet banking was introduced by for risk management and financing, removal of the £500 minimum accounts next door. relaxing drink and for the wine Barclays Wealth as part of its plan and Barclays Global Investors, which balance and ATMs with a dual Sterling NatWest first opened on The Rock 20 years ago, triggered buff, a choice of nine wines by to expand significantly its Gibraltar claims to be the world’s largest asset and Euro currency service. by the re-opening of the border between Gibraltar and Spain in the glass personal and intermediary banking management house. Derek Sene, deputy country head at 1985. Then NatWest invested £6.4 million on working capital, Lounges business. But of particular interest to Barclays Barclays Wealth in Gibraltar, said, “This the Bank office, staff accommodation and systems expenditure. Take a good old fashioned English The investment in new technology intermediary clients will be the link to investment demonstrates our commit- When the branch opened Group Chairman Lord Boardman tea in one of the spacious lounges means access to a wider range of IceB that enables intermediaries to ment to Gibraltar as the country is an described the operation as a unique project as it was probably Barclays Wealth products and services, manage a large number of accounts on important focus for Barclays Wealth.” the first time that the Bank had opened on the same day within some of which will be available in behalf of their own clients, effectively The state-of-the-art banking plat- one set of premises three separate financial services businesses - Gibraltar for the first time. providing a virtual branch within their form meant access to Barclays’ world- retail banking services for Gibraltarian residents and offshore It includes access to institutional offices. class investment expertise, combined customers, a multi-currency deposit-taking entity for Europa Road, Gibraltar expatriates, and an investment/trust operation. Tel: +350 200 73000 quality products and investments Personal customers gain access to with local knowledge. Fax: +350 200 73513 E-mail: [email protected] www.rockhotelgibraltar.com

28 GIBRALTAR INTERNATIONAL SUMMER 2008 SUMMER 2008 GIBRALTAR INTERNATIONAL 29 LAST WORD Everything and nothing changes! ’ve always been sceptical about regulated environments financial servic- The FSC, in 1994, was responsible looking back. You can never tell es, competing on a par with “Dublin and for supervision standards to match the what will be recalled – good or bad. Luxembourg”. Comparisons increasing- UK and ensure Gibraltar specific EU But this is the tenth anniversary ly were with other EU jurisdictions, not directives were met. ‘98 was the year issue of this magazine and it set me off-shore ones. Heady days! Indeed, when UK Foreign and Commonwealth Iwondering what things were like in Expat Investor magazine in 1998 Secretary Robin Cook said he wanted all Gibraltar in 1998 a decade ago. It was declared that Gibraltar had emerged territories with financial sectors to have after all a time when Viagra had just been “like a beacon of exemplary financial the highest standards of regulation, using invented; artificial hearts and livers were regulation”. Just as well, because no less Gibraltar as the benchmark. What a turn made possible and the search engine than HRH The Duke of Kent officially around; he cited “advances that had Google became a fledgling reality. opened the Finance Centre’s new premis- transformed Gibraltar’s international The mobile phone became a mass es at Europort . reputation”. media channel in 1998 when the first ring The Rock had been used to develop- A second Financial Services tones were sold, with other media ing and operating traditional private Commissioner, Martin Fuggle, was content – news, videogames, jokes, trusts and a companies structure, but appointed fresh from being consultant to horoscopes, TV content and advertising – from then on they were put into a more the Bermuda Monetary Authority, after appearing soon after. European model, and opened the way for John Milner’s initial four year stint. He Between the 1980s and the 2000s, as more corporate and added value work. began with the indictment that there was one commentator put it, “the mobile Now mainstream insurance and Law “inadequate legislation” and the FSC phone has gone from being an expensive firms were losing their domination of under-resourced; legislation was “almost item used by the business elite to a such work. up to date” and “nearly all” EU direc- pervasive, personal communications tool Then The Rock laid claim to 26 tives implemented. for the general population”. If only international banks; now there are 18, Currently, some believe the FSC to Spanish mobiles always worked in but with total assets of £11 billion. be similarly under-resourced; but this Gibraltar too! There are also 100 licensed insurance surely is more a reflection of the weight

B MOBN ..GBATRBAC,Sie714 uoot Gibraltar. Europort, 731-4, Suite BRANCH, GIBRALTAR N.V. BANK AMRO ABN Yes, it’s hard to think of what life operations making Gibraltar a main- of work arising from many licence appli- SUBSCRIPTION FORM was like back then – it seems as though stream insurance EU domicile, as well as cations and stringent compliance regula- I wish to become a new subscriber to: forever Gibraltar has been ‘the finance 33 investment firms, 32 Experienced tion. New applications may well slow as Gibraltar International magazine centre of choice’. Our first issue headline Investor (EI) funds, 12 protected cell world recession bites to ease the situa- proclaimed: “Gibraltar – the passport to funds companies, 86 trust and company tion, but it’s as much about the strin- Please charge my credit card: a successful finance centre”, echoing the managers, and funds under management gency of approach by present FSC UK £24 EU £32 Rest of World £44 words of the first Finance Centre of £10.3 billion. Phew! Commissioner Marcus Killick, who Visa Mastercard American Express Development Director, as he was then Ten years ago, links were established joined five years ago to become fiercely known. with Malta with the aim of mutual independent, but fair. Card Number He was of course, referring to the benefit from Gibraltar’s position in EU So life goes on. In ten years, new facility to passport insurance, with and the Mediterranean island’s experi- Gibraltar living standards have Expiry date similar passporting ability keenly antici- ence with double taxation agreements: improved; the economy shifted fully into euae yteFnnilSrie Commission. Services Financial the by Regulated Name pated for banking and then investment Victor Chandler switched his tele-betting self-generated rather than military your investments services too. Fund administration and business from the UK to Gibraltar dou- dependent; streets and the living environ- Company custody were also identified as sectors bling his first year turnover and clients ment more pleasant; good service is now Address ‘ideally suited’ to Gibraltar. extended to the US and the Far East. being regarded as essential. their hot tips At that time, Gibraltar became And to complete the picture, every- In 2018, will Gibraltar be more like the only off-shore centre to have one’s favourite, property development a Swiss city, attractive to the high-end your judgement implemented ‘all crimes’ moneylaunder- and prices. The 125 ‘luxury’ apartments disposable income set, smart shops Telephone (incl. dialling code) ing legislation. in the first phase of Queensway Quay selling haute couture to compete with our objectivity It marked a subtle, but nonetheless was fully sold; apartments in Sotogrande Marbella and Sotogrande; ample car Signature fundamental, shift in The Rock’s were marketed at between £90,000 and, parking; a simple border crossing to competitive position – a swing in empha- in the Marina, from £150,000. Villas mainland Spain; a must-see tourist Date Our new EXECUTIVE PRIVATE BANKING is designed for busy professionals who work in Gibraltar. Release capital with an sis away from talk of “offshore” and there were £280k and land was £38-75 destination? Only time will tell; but I When complete, please return this form to: Equity Release Mortgage. no-taxes to an emphasis on low tax as per sq metre. Neptune House in Marina guarantee it will be just as hard to Subscriptions Department, Private Banking is now accessible to you! part of the EU. Then talk was very much Bay had studios at £35,000 and 4-bed remember then what it was like now. Gibraltar International Finance Publications Ltd. of ‘repositioning’ the finance centre. penthouses from £180,000. Some things P O Box 561 ABN AMRO makes more possible. Call 74474 to find out more. MBC 6/104 It was even then one of the best have certainly changed. Ray Spencer 1 Irish Town Gibraltar or fax to: +44 1865 749827

30 GIBRALTAR INTERNATIONAL SUMMER 2008 SUMMER 2008 GIBRALTAR INTERNATIONAL 31 new flights start 12 september gibraltar to manchester 3 flights a week gibraltar to luton daily flights fly from £41 low fare one way including taxes more care

conditions apply.