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. www.gibraltarinternational.com Gibraltar International 3 Aug/Sept/Oct 2017 Volume 2 3/ Number 3

Cybercrime p16 Establishing ‘community of partners’ to combat Contents internet crime News p6 Brexit concerns overshadow record budget result Private foundations p18 Gibraltar Private Foundations legislation Budget p8 a significant addition Budget 2017 – tax measures Fintech p20 Insurance p10 Businesses using new technology showing Newcomers confounding Brexit uncertainty as focus ‘extraordinary interest’ in new controls intensifies on solvency compliance Funds p26 Gibraltar Funds & Investments Association (GFIA) Funds p14 Revamped regulation of Gibraltar funds Business round up p28 Editorial Comment Economic growth goes on

great deal of effort has been made by Gibraltar to reposition its with the huge trading bloc. Continued access to the UK, the world’s 5th largest business appeal to reach new market sectors and expand economy, has proved appealing to insurers, some relocating from the UK and on existing strengths – with some initial success! others on the cusp of moving to The Rock with UK-facing business plans. It’s A As articles in this edition of Gibraltar International reveal, a similar story with eGaming firms that continue to add staff, despite a spate of firms are either expanding their existing operations or choosing to locate mergers and rationalisation measures. their operations on The Rock. The Financial Services Commission is working on at least five Employment, led by the private sector, has never been higher, insurance company licence applications submitted in April and May, together amongst Gibraltarians – there are fewer than 200 unemployed. – and added with four general and life businesses, adding to the 61 insurance entities to the territory’s highest annual GDP to end-March of £1.9bn. The 12,000 already licensed. British, Spanish, other EEA and third country citizens crossing the frontier Artex International, the territory’s largest insurance manager, expects to every day to work in Gibraltar account for approaching 50% of total take on another 5 or 6 insurance enterprises , the majority UK-focused and employment. some prepared to relocate part or all of their operations to another EU location Whatever may happen as a result of the internal wrangling over the if ‘passporting’ rights eventually are not secured. form of UK Brexit, Gibraltar is taking no chances and planning on “a hard The fledgling fintech sector has been boosted by expected regulation from Brexit”, as James Tipping, the territory’s Finance Centre Director, told the the year end for firms using distributive ledger technology for crypto currency, EU Committee of Inquiry into Money Laundering, Tax Avoidance and Tax crowdfunding ‘tokens’ and other blockchain financial services applications; the Evasion. interest in Gibraltar from start-ups is described as “remarkable”. However, it is “with a firm commitment from the United Kingdom Yet with the spread of internet technology comes certain widespread fraud government to maintain and broaden access to their financial markets from and ransomware, so it’s apt that Governor Lt. Gen. Ed Davis is leading the Gibraltar,” he said, adding pointedly that “we will be the only territory in charge to alert and educate businesses and individuals on The Rock to the Europe with automatic access to the United Kingdom in banking, threats and how to combat them. insurance, investment services and any other similar area where cross- Financial services continue to do well despite Brexit uncertainties, but the border [EU] Directives currently apply.” Chamber of Commerce considers “it is sometimes painful to do business in That set a marker with which to compare other EU jurisdictions Gibraltar and it will not get easier unless there is a root and branch change of such as Malta, Cyprus, Luxemburg and Ireland, for example, some attitude. This has to start with and be led by government!” that may seek to take advantage of Gibraltar’s enforced disengagement Ray Spencer

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4 Gibraltar International www.gibraltarinternational.com

News Brexit concerns overshadow record budget result “Gibraltar’s economic performance before the 23 June last year could remain on the minimum wage is being raised by 17p The Rock, and Gibraltar would mirror the (2.7%) to reach £6.45. However, “the larger has been outstanding in this first UK’s position on acquired rights of EU the job market, the greater the opportunity nationals established or working in Gibraltar for abuse”, suggested Picardo, who leads a financial year since the Brexit “before the final cut off date that might be socialist and liberal political alliance. A referendum”, Fabian Picardo, agreed between the UK and the EU”, and it working group involving Unite the Union would support determination by the and employer representative bodies is “to Gibraltar’s Chief Minister, said when European Court of Justice “in any disputes establish principles for Trade Union presenting the 2017-18 budget affecting this class of EU Citizen.” Recognition in the Private Sector”. But he held: “If the UK and the EU enter into new, post-Brexit, trade Conservative assessment ittered with references to the UK’s arrangements in future which extend rights Inflation stood at 1.5% in October 2016, but planned departure from the EU on 29 to EU nationals arriving into the UK to averaged 2.6% in 2017, compared to 0.25% L March 2019, which also embraces establish themselves or to work after the UK a year earlier, “largely the result of rising Gibraltar, his sixth budget watchwords has left the EU, those arrangements will not import prices from the fall in sterling since were “prudence, caution, optimism and apply in Gibraltar if the [Spanish veto] the EU referendum, together with the higher investment”. excluded Gibraltar” from any such global price of fuel”. Picardo, vowed to “make Gibraltar the arrangements. Revenue in 2016-17 was £63m higher most attractive place in Europe and in the than budgeted at £615m, with income tax of Mediterranean to do business” and reported Limit to job rights £154m contributing £5m more that expected a record surplus, employment, income and Picardo emphasised: “Any new Spanish or and corporate tax around £31m more at investment by the private sector. EEA nationals entering the job market after £135m. For the current year, the surplus is

However, veteran economic develop - the 29 March 2019 will – as things currently £18m, “a conservative assessment of what ment minister, Joe Bossano, later cautioned: appear to stand – enjoy only the generous we believe is achievable”. Estimated “The strong performance of the private rights enjoyed by those who are today third recurrent revenue for the year is budgeted to

sector in the last financial year may not be country nationals.” increase over £24m, or 4.1% over the repeatable in the current year with so many Employment rose 3.6% to reach previous year’s estimate. Whereas the imponderables that it is impossible to make 27,073 by October 2016 (the latest expenditure budget for the year is £597m, a any kind of sound judgment.” figures available), of which 11,065 were ‘ 4.5% increase on the 2016/17 estimate. “In terms of the existing economic Gibraltarians, leaving fewer than 200 locals Nominal GDP is forecast to have model, we need to continue developing the jobless. Strongest employment gains were in reached £1.91bn, almost 9% more in initiatives and the areas of the economy that the private sector – up 4.5% to 20,977. The 2016-17 and the government is working towards its 2015 manifesto promise of Picardo, vowed to “make Gibraltar the most attractive £2.4bn GDP by end-March 2020. place in Europe and in the Mediterranean to do business” High GDP ranking Picardo pointed out that Gibraltar’s per are showing growth until we are better gaming industry saw “spectacular job capita growth, using IMF rankings, meant it placed to be able to assess what is the likely growth” - up 9% (289) - after the referendum would be placed fourth ahead of Singapore, ‘ outcome in two years time,” Bassano result. In the past year, two new firms have Switzerland, Hong Kong, UK and Spain, concluded. been licensed and four, others were in the although he counselled: “These measures are Maintenance of a free-flowing border pipeline, he revealed – “a truly remarkable not entirely scientific because of the differing with Spain is of most concern, particularly vote of confidence in Gibraltar” and “we methodologies and fluctuating exchange after the European Council gave that country remain the premier jurisdiction in the world rates on which they are based. Nonetheless, a right to veto any trade deals with Britain for the best regulated online gaming services they are the measures that the rest of the that also included this overseas territory. available to consumers”. Gaming charges world relies on.” “Twelve thousand people cross the and fees increased in 2016-17 to over £15m, Aggregate public debt was marginally frontier every day to work in Gibraltar. “demonstrating this sector is vibrant and lower year-on-year at £443m at end March Seven thousand are Spanish. So Brexit performing”, Picardo maintained. 2017, while cash reserves stood at £123m. affects Gibraltarians, British, Spanish, and Civil servant employment grew by just Picardo reported: “Net public debt stood at other EEA citizens, as much as it does third 0.4% (23) and their pay will rise – again in £320m, or 16.75% of GDP, and we have country citizens,” Picardo remarked. contrast to the UK - by 2.75% from August. reduced net debt since them by 8.5%.” Picardo made clear that all EU workers Income tax now starts at £11,050 and Ray Spencer

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Budget Budget 2017 – tax measures

By Neil Rumford, which combines lower rates of tax with HEPSS & HNWIs fewer deductions. The maximum effective No changes were announced to the tax status Tax Partner, (overall) rate never exceeds 25%, and starts available for “high executives possessing EY Limited to decrease once taxable income exceeds specialist skills” or to high net worth £500,000. Some examples of the effective individuals (Category 2 ). These tax schemes tax rate at different income levels are: cap the tax payable by such individuals to fixed amounts, subject to conditions, of Total taxable income Effective tax rate £29,940 (HEPSS) and to between £22,000 £25,000 17% and £27,560 (Category 2). £50,000 22% From £105,000 to 25% Social insurance n the 26th of June Gibraltar’s Chief £500,000 Gibraltar has a cap on social security Minister, the Hon Fabian Picardo £1,000,000 18% contributions by employers and employees OQC MP, presented his 2017 Budget of £36.50 and £27.50 per week, respectively. address. Combining Brexit caution with an No changes were announced to these in the upbeat message, few significant changes in Allowance based system (ABS) budget, having been increased by 10% with the area of tax were announced. The tax rates and bands for this system effect from 1 April 2017, after many years An “interactive summary” of the remain as before: without any change. Gibraltar government’s revenue and expenditure budget for 2017/18 was present - Taxable income band Rate applied Import and excise duties ed, which can be accessed on the First £4,000 14% Changes announced to import duty included: Government’s Press Office webpage. From £4,001 to £16,000 17% this, together with the budget address, we Changes From To can summarise the three main income Over £16,000 39% ↓ Gold bullion 6% 1% streams for the government as follows: Minimal changes are to be made to ↓Classic cars Budgeted some allowances; the more common (subject to conditions) various 0% 2017/18 2016/17 2015/16 allowances include: £m £m £m ↓ Handbags 6% 3% Personal allowance £3,300 Corporation tax 120 135 109 (was £3,215) ↓ Childrens’ prams 12% 0% Income tax 155 154 148 Spouse allowance £3,300 (was £3,215) Import duty 160 166 152 ↑Diesel fuel 22p 25p House purchase £12,000 per litre per litre allowance (no change) Corporate tax Nursery school £5,160 ↑Jet skis 0% 20% No changes were announced in respect of (per child) (was £5,025) corporation tax. The standard rate of tax Medical insurance Up to £5,155 ↑Waterpipe tobacco £3.00 £15 remains set at 10%. (was up to per kg per kg £5,020) Personal tax Child allowance £1,135 ↑ Refills for heated N/A £45 The alternative systems, the Gross Income (was £1,105) tobacco products per kg Based System and the more traditional Child studying abroad £1,290 (tobacco content) Allowance Based System, remain. (was £1,255) Whichever results in less tax is the system that applies to a taxpayer. Savings income A major factor in deciding if the ABS Property-related measures and capital gains are not taxable under either applies to a taxpayer is whether they own There were no changes announced to stamp system. their home in Gibraltar. As well as the house duty, or to property rates. Inflationary increases in tax allowances purchase allowance above, there is an were made for those taxpayers using the additional £4,000 purchase allowance (to be www.ey.com/gi Allowance Based System, with no change in spread over four years). Mortgage interest tax rates or bandings. deductions are given for mortgages of up to There was no change announced in £350,000 (and even higher for pre 1 July respect of the Gross Income Based System, 2008 loans).

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Artex Risk Solutions (Gibraltar) Limited and Artex Corporate Services (Gibraltar) Limited are regulated and authorised by the Gibraltar Financial Services Commission to carry on business as Insurance Managers and Company Managers. April 2017 Insurance Newcomers confounding Brexit uncertainty as focus intensifies on solvency compliance Efforts to attract new insurance motor insurers to establish in Gibraltar, a we will see fewer smaller insurance start-ups decision it said had “proven very successful”, in Gibraltar." business are starting to reap dividends and it is developing products beyond motor Some insurers have reduced their with Gibraltar acting as a gateway to business to include household cover, “offer - underwriting capacity because of capital the UK, Ray Spencer finds, and the ing a lifeline for those who struggle to obtain constraints. Even so, some other firms are Regulator is focusing on capital and risk buildings and contents insurance through the said still to be coming to terms with S2, mainstream market”. particularly the capital requirements, and requirements to ensure consumers are “There are other businesses looking industry insiders describe them as “living on protected at Gibraltar”, Michael Ashton, a senior borrowed time”! insurance specialist at the government’s Casualty & General Insurance Company arge Gibraltar motor insurers continue to Gibraltar Finance, told Gibraltar (Europe), a privately owned company was grow and remain the dominant part of the International . “Gibraltar’s life one of the first non-motor LGibraltar market, but the potential to insurance sector is tiny insurers in Gibraltar in 2003 generate non-motor business over the next compared to the non-life sector and specialised in defects and few years also looks promising. but new life insurance business surety business in the UK and Gibraltar Financial Services Commission are currently looking at the across Europe, including (GFSC) is processing at least five insurance possibility of establishing in Belgium, France, Germany, company licence applications submitted in Gibraltar.” Ireland, Italy, Netherlands and April and May, compared with just one in the Under the EU Solvency 2 Norway. 12 months previous. A further three general (S2) Directive, that amongst However, in March insurance intermediary applications have other things required insurers CGICE ceased writing its been submitted in the two months, the same as from 2016 to have much UK motor book – premiums that for the whole of the year greater working capital and £20.4m last year - following to March. In addition there is reserves, monoline insurers the decision by the UK’s Lord a life intermediary business in can benefit from diversification Slovakian regulator “comfortable” Chancellor to reduce the per - with Gibraltar: Andy Baker, new prospect. by gaining credits that sonal injury payment discount Premium Insurance CEO At present, there are 61 effectively reduce the amount rate of calculation from 2.5% insurance entities licensed, of money that must be held to protect against to minus 0.75%, and the market volatility with a total premium income the risk of business failure. which followed. CGICE was unable to gain of circa £4.8bn, and of that the Gibraltar’s Markerstudy, formed in 2001 sufficient reinsurance cover at an acceptable two Life insurance businesses and best known for motor business, acquired cost, but it “continues to monitor future account for just £150m. two pet insurance companies – Purely Pets developments”, according to its Solvency and It can be revealed that a and Paws and Claws - in 2015 after taking Financial Condition Report for 2016, just large US-based insurance over Ultimate Insurance Solutions, cementing published. entity offering a line of a pets diversification move that began two Similarly, Gibraltar’s Horizon Insurance Some firms business new to Gibraltar, but aimed years earlier when gaining BDML. Growing (formerly known as Octagon) stopped must rework exclusively at the UK market, is expected to from one to 12 staff, the firm now insures and renewing or accepting motor policies from capital needs, be “very big”, following its planned launch in brokers a number of non-motor related end-December; the directors said it was says Joe Pardon, GFSC head of August, assuming GFSC approval. products, including commercial (non-motor), because they were unable to secure additional prudential Gibraltar-based insurers mostly travel and gadget/mobile phone and home funding to meet business plans from 2017 – underwrite motor policies, the 26 firms insurance. but, crucially, emphasised the decision was together accounting for over 60% of the UK The widening scope was not prompted not related to S2 capital requirements. market, although there is a growing by S2 requirements, however: “We are a The Gibraltar government was also in diversification, including healthcare, pet, dynamic underwriter who will write classes March forced to step in and issue a statement legal and other niche areas. where we see an opportunity to make a profit. emphasising “its complete support for the Admiral, the large UK-facing car Pet business is treated more harshly than insurance sector in Gibraltar and confidence insurer, is writing roughly £1bn of premiums motor under Solvency 2, for example”, in the important role played by the GFSC in in Gibraltar and of that around 10% is now Markerstudy said. delivering high European standards of with homeowners. Nevertheless, Ashton suggested: “S2 has insurance regulation”. Another, Hastings Group (through been a game changer for the insurance sector. The unusual move was prompted by Advantage, the Gibraltar subsidiary), has Previously entrepreneurs were able to media reports on comments by the Irish started in a small way to write home insurance establish a new insurer with the minimum Regulator, the Central Bank of Ireland and in - around 10% of premiums. capital requirement, but S2 has introduced Haven, in 2002 was one of the first UK more onerous capital requirements. I believe Continued overleaf

10 Gibraltar International www.gibraltarinternational.com

Insurance

Newcomers confounding Brexit uncertainty times they fail like any other business: whilst Premium Insurance was set up in March as focus intensifies on solvency compliance we must do as much as possible to avoid such after a 15-month licensing process by Continued from p10 failures, there will always be the possibility of investors, also owning Slovakia’s largest an insurance failure if a jurisdiction wants to independent insurance broker, because the Irish Parliament that suggested not enough build an insurance industry.” “Gibraltar had an experienced regulator, it had been done by Gibraltar’s regulator to was open for business and open to prevent a repeat of last year’s collapse of Ongoing sore discussion,” declared Baker, who has become locally-based Enterprise Insurance, which hit Andy Baker, a senior insurance professional local managing director. Premium was the 14,000 Irish motorists. in Gibraltar, commented: “As I am sure first insurance company licensed after the Enterprise spectacularly failed when the anyone in insurance here will agree, the Brexit vote. GFSC ordered the firm in July 2016 to cease Enterprise failure has wounded our local Having decided to open an insurance trading to protect a total of 760,000 policy - reputation and it will be an ongoing sore for company in Slovakia, “the regulator [there] holders in six countries after it was believed to sometime; competing jurisdictions will be was refreshingly open and honest and admit - be insolvent – the liquidator subsequently using it against us, but in truth it is just one of ted that they didn’t know how to do that,” appointed, confirmed there was “a several insurance failures that have occurred Baker, a former advisor to the GFSB and a prospective balance sheet around the world.” president of Gibraltar Insurance Association, deficit of some £96m”. He felt countries increasingly will “not noted. It was recommended they find Samantha Barrass, accept EU passporting into their territories another [EU] base jurisdiction to passport into GFSC chief executive, simply by notification, and are now moving Slovakia and the Regulator was comfortable robustly defended the towards an individual approval process”. with use of Gibraltar. regulator’s work, saying she There were several areas of the S2 policy Writing only commercial business, had utilised “new powers open to interpretation and international Premium is not UK-focused, so if Brexit available to the Commission meetings have been developed to avoid differ - meant the end of passporting in 2-3 years’ under Solvency 2 to ensure ences in approach between jurisdictions. time, “there is no lifeline, but by then there the Commission has the right Joe Perdoni, GFSC head of prudential, would be a proven track record and capital information to support our told Gibraltar International. that, although built up, so [Premium] could re-domicile Defending GFSC: supervision”. She emphasised: “We proac - there were a few firms that had “transitional easily”, Baker observed, or choose to contin - Samantha tively share information with all the host state arrangements” from the start of S2 in January ue with its present arrangement with Artex Barrass, CEO regulators of the jurisdictions in which our 2016, by June all were compliant. “That isn’t International, Gibraltar’s largest insurance Gibraltar insurance companies operate and to say some firms are not still struggling with management business. we participate in joint supervision activity.” S2; it’s much more complex than S1 and sub - Part of A J Gallagher, a Chicago-based The eleven Gibraltar firms passporting ject to a lot of assumptions firms make on company, Artex first bought Heritage motor insurance into Ireland, “contribute 6% meeting those capital requirements.” Insurance Managers in 2014 and then of gross written premiums to the Motor Gibraltar’s insurers (excluding captives) acquired Quest in mid-2016, merging the two Insurance Bureau in Ireland and 2% of non took part in a GFSC-led quality assurance local operations at that time. Steve Quinn, life premiums to the local Insurance review in March to ensure similar capital Quest founder, has become managing director Compensation Fund that was set up in 2012 to assumptions across the market. “Some of of Artex in mainland Europe, which includes contribute to the losses sustained in Ireland those findings mean firms will have to Malta, and plans to expand into other EU following the €1bn collapse of the Irish complete calculations slightly differently – states, “probably later this year”. insurer, Quinn,” the government revealed. some are fairly straight forward, but some Artex already handles 14 insurance By end-2016, Gibraltar firms operating firms will have to rework their numbers”, companies and six intermediaries. “We expect in Eire had contributed some €7m to the Irish Perdoni explained. to license another five or six enterprises not compensation schemes and a further €4m+ already present in Gibraltar, even with the expected this year. “This will more than meet Drilling down. prospect of Brexit”, Quinn declared. “The the estimated losses arising from the GFSC chief executive Barrass, added: “As majority of those businesses are UK-focused Enterprise failure in Ireland”, the government with other insurance regulators, the initial and we have some people prepared to move maintained. (Gibraltar firms have also focus of S2 was on capital levels and reserves here, even if it means they may have to shift contributed some £350m to UK compensa - issues, but since January this year we have to another EU location eventually.” tion schemes.) been drilling down into other aspects – the Ashton declared: “What is interesting is In April, the GFSC said it “may have approach to risk management and governance that after a 2/3 months period of people been significantly and consistently misled” - within insurance companies. There will be accepting that Gibraltar has to leave the EU, about the true financial position of Enterprise, those companies that just got over the line and then the government survey of financial licensed in 2004, adding: “The extent of the they are the ones we will be paying greater services found over 90% of our business is financial collapse of Enterprise is unprece - attention to.” with the UK, showing that as a jurisdiction we dented.” Prior to S2, the insurance sector in had not been as successful as we had hoped in The Finance Centre’s Ashton was Gibraltar generally was hovering much more attracting business from the rest of Europe but sanguine: “No-one wants failures in a around [lesser] S1 requirements on capital very successful with business into the UK. I jurisdiction, but it is a fact that insurance and their governance approach to risk believe the message now is around our access companies are there to take risks and some - management, she observed. to the UK, the world’s 5th largest economy.”.

12 Gibraltar International www.gibraltarinternational.com We a r e G i b F i b r e

                                                                    

6 'KNHO"IKDĂDRGEOM  www. g i b f i b r e . c o m GibFibre connecting business Funds Revamped regulation of Gibraltar funds By Jay Gomez, Senior Associate and number of 15 investors. l The EIF’s unique deemed authorisation l Continues to be a vehicle for a small group route clarified – i.e. if the board resolves to Javi Triay, Associate,Triay & Triay of investors, and as such will require an become an EIF and a notification is Financial Services Team investor acknowledgement concerning the submitted to the GFSC with all the required fund’s status (i.e. not regulated by the documents as stipulated by the Regulations GFSC). within the 10 days. Once that is completed, l Private schemes structured as a family the EIF is deemed to be authorised by the office can have a maximum number of 50 GFSC from the date of the board resolution. investors. With this clarification, the EIF continues to l Private schemes managed by an be the funds vehicle with the best speed to authorised firm (either an EU regulated firm market on the European continent. or firm which the GFSC has consented to) l The controllers of the EIF are responsible can have a maximum number of 50 for ensuring that arrangements are in place investors. with a bank and/or broker to keep the t has now been just over a year since the l On establishing a private scheme, a legal relevant assets of the EIF safe and accounted United Kingdom voted to leave the opinion will be required to confirm that it for. IEuropean Union. The Gibraltar funds complies with the Financial Services l For closed-ended EIFs, the submission industry however, is adamant that the (Collective Investment Schemes) Act and date to the GFSC for audited accounts has infamous vote, which brought with it a heavy Financial Services (Collective Investment been extended to 9 months from the year dose of pessimism and uncertainty, can Schemes) Regulations. end. This change has been brought about to instead be good news for Gibraltar in l The requirement for an annual audit may allow greater flexibility to, for example, furthering its offering as an emerging and now be waived, but must be waived by all private equity funds. growing hub for investment funds and investors. Where the requirement is not l Clarification on the ability of promoters of managers. waived, audited financial statements should EIFs (which are in the process of being Following extensive consultation be prepared within 6 months of the year end established) being able to discuss the between the Gibraltar Funds and or, in the case of closed-ended schemes, investment with potential investors before Investments Association (GFIA) and its within 9 months of the year end. the EIF is established. members, the Gibraltar Financial Service l Private schemes are now eligible for l The requirement to disclose service Commission (GFSC) and the Minister with ‘upgrading’ to an Experienced Investor Fund providers in the private placement responsibility for Financial Services, the new whenever it deems it appropriate. memorandum has been clarified to include legislative framework for investments funds material service providers: directors,

has been drawn up. Experienced Investor Funds investment managers, investment advisors, The new legislative framework (EIF) legal, administrator, secretary, bank, broker

creates Gibraltar’s dual-fund regime which l Every EIF will require a minimum of 2 and auditor. maintains the status quo (i.e. EU access EIF directors. At least 1 EIF director has to pre-Brexit) and provides a duality so that the be resident in Gibraltar but the GFSC will Gibraltar Alternative necessary vehicles post-Brexit are permitted now have the power to dispense with this ‘ Investment Fund and clients may continue operating outside requirement. Any EIF director not being (Gibraltar AIF) Under the new framework, EIF’s which The Gibraltar funds industry however, is adamant that are “in-scope” or have opted-in to the the infamous vote, which brought with it a heavy dose Alternative Investment Fund Manager Directive (AIFMD), have to rebrand and of pessimism and uncertainty, can instead be good become a Gibraltar AIF. It would also be news for Gibraltar required to comply with the Financial Services (Experienced Investor Funds) ‘ of the EU and, subject to the Brexit deal ordinarily resident in Gibraltar has to be Regulations and the Financial Services agreed between the UK with the EU, a approved by the GFSC – this does not, (Alternative Investment Fund Managers) vehicle which will allow access to the EU’s however, mean that the EIF director will Regulations. This has effectively created a single market on the basis of reciprocity need to be licensed by the GFSC. new product that is part of a ‘dual-regime’ and/or equivalence. l The new regulations further clarify the offering the opportunity to be an EU Some of the key changes include: term “Experienced Investor” to include, compliant AIF. www.triay.com amongst others, persons who invest €100k Private Schemes into an existing EIF. The lower threshold of l Private schemes that are not structured as €50,000 on the basis of having been advised family offices and/or not managed by an by a professional advisor has been left authorised firm will have a maximum unchanged.

14 Gibraltar International www.gibraltarinternational.com

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www.sapphire.gi +350 200 47 200 - [email protected] Suite 3.0.3 Eurotowers, PO Box 797, Gibraltar Cybercrime Establishing ‘community of partners’ to combat internet crime Dozens of firms and organisations Jackson referred to an interactive Active Partners’ is destined to fail. In fact, it will be have signed up to the Gibraltar node Threat Level Analysis System deployed for never got off the ground. How we navigate many service providers to trace internet attack this challenge will determine Gibraltar’s of the Global Cyber-Security sources “and it is non-stop”. reputation as a beacon of digital excellence.” Information Sharing Partnership (CISP) Countermeasures monitor internet Delegates also heard from Gibtelecom’s with the aim of sharing knowledge traffic to detect abnormal activity. “There is Jackson how companies faced external cyber and protecting The Rock’s businesses talk of getting government bodies involved to attacks from botnets (groups of compromised and residents from cyber attacks, try to prohibit devices being sold without computers connected for malicious purposes Ray Spencer finds internet protection, but frankly that is thought and controlled by criminals to transmit to be too complicated as it would involve malware or spam), and ransom software such multi-jurisdictions”. as WannaCry that paralysed the NHS and he Gibraltar CISP mirrors that Governor Davis, opening the event, caused companies in 150 countries to lose established by the National Cyber declared: “Gibraltar is determined to get files and infected systems. TSecurity Centre (NCSC), as a part of ahead of this challenge; and, in doing so, Use of botnets has accelerated: “In the UK’s intelligence body, to provide develop a Jurisdiction that is regarded, 2014-15 a large botnet would have seen participants with early warnings of cyber internationally, as a beacon of digital around 75,000 machines affected; today we threats and an ability to learn from excellence owing to its digital relevance, are talking about 500,000+”, Jackson experiences, mistakes and successes of other robustness and resilience. A reputational reported. “Until 2016 the botnet attack was users and as a place to seek advice. head-mark that will build on Gibraltar’s undertaken quite secretly, but when a hacker growing ability as a globally-connected and released the source code on the internet and locally-federated platform for 21st century presented it to a much wider audience so that digital assurance and innovation.” anyone can see how it works and adapt it, multiple variants have resulted and each can Getting ahead compromise a computer network”, he said. The Summit was another “let’s-get-ahead-of- Rik Ferguson, vice president of security the-pack opportunity for those of us interested research at Trend Micro UK, emphasised: in being the first to understand, the first to “We have seen many threats in 2016 for adapt, and the first to seize the opportunities businesses and individuals. Serious business, of our rapidly transforming world”, he said, as serious money and serious consequences.” it followed the Digital Currency Summit, held “In 2014, we saw 13 unique families of in May at Gibraltar University (see “Fintech ransomware and by 2015 it had reached 29, article”, p20) and then last year, there were 246 new distinct Cyberspace security, Davis submitted, families of ransomware - criminals investing The Dark Web, Lt Gen Ed Davis, Gibraltar’s Governor, included the need to develop a ‘mindset’ that time, resources and finances in developing a location for pointed out at the first Gibraltar Cyber focused on mitigating challenges and seizeing these creations to make money”, Ferguson hackers and Security Summit in June, that in the six opportunities of the digital world, as well as reported. Ransoms paid by individuals and ransomware months prior to NCSC launching in February, “the shared civil and corporate responsibility, businesses, together with the cost of recovery 34,550 potential cyber attacks on UK necessary to form and sustain, a ‘Community from attacks, had cost up to US$1bn in a Government Departments and Services were of Partners’ across Gibraltar’s cyberspace single year, “for just one facet of on-line crime blocked, “the intent of which was to exploit enterprise”. - one of the biggest problems in terms of British citizens by fraudulently obtaining their Davis has made cyber security a criminal activity.” online personal data”. personal campaign for his three-year tenure as And he warned: “97% of all phishing The Rock is no exception, as Governor. He said it was crucial to operate emails contain or lead to ransomware-type of William Jackson, Gibtelecom VP technology “within well-regulated and progressive attacks and the number of domains linked to operations, noted: “It's a very regular threat. cyberspace security governance across civic, this is increasing exponentially; it is very We have multiple points in London and corporate and governmental domains….”. He much now targeted towards businesses, rather Marseilles where we connect to the internet added: “If this ‘Community of Partners’ is to than individuals at home.” Even so, in 2016 and pair with some upstream providers”. succeed, we need to find a way of protecting his business had “blocked about 1bn attempts The principle supplier of telephone and each partners’ privacy, intellectual property to infect our customers using ransomware– internet services for Gibraltar, Gibtelecom and business USP within the community. and there are many other security vendors – routinely intercepts “two major incidents a “If the cost of collective interdependent so this is at epidemic proportions,“ Ferguson week, where we need to scrub [remove the preparedness is the loss of individual compar - added. threat from] the network”, he said. ative advantage, Gibraltar’s ‘Community of Continued on p24

16 Gibraltar International www.gibraltarinternational.com Don’t get left behind We provide business communications for the digital age t


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Make amazing happen +350 200 52200 | [email protected] | gibtele.com Private Foundations Gibraltar Private Foundations legislation a significant addition By Paul Astengo, Senior Executive, described as a legal entity created when a Private foundations are flexible person provides assets for a specific purpose. philanthropic vehicles, often created to fulfil Gibraltar Finance and Adrian Pilcher, The foundation holds the assets for purposes the philanthropic goals of a family. They are Partner, Isolas set out in its constitutive documents and not usually designed to carry out charitable administered according to contractual rather work but they do instead support charities in n March, Albert Isola, Minister for than fiduciary principles – principles that carrying out that work. Commerce, presented a Bill in the make them acceptable to people who are Private foundations have become IGibraltar Parliament that would allow for uneasy about using trusts. The foundation is a increasingly popular and in some cases have the creation of Private Foundations in distinct legal entity but unlike a company, it become highly visible as people of significant Gibraltar. has no shareholders. wealth carry out philanthropic work. In some In 2012, the Gibraltar Society for Trust very high profile cases the monetary value and Estate Practitioners proposed a number of Public register held by private foundations runs into the legislative reforms to the Ministry of Foundations are structures used in similar billions. The increase in popularity is also due Financial Services in the area of trusts and circumstances to traditional family trusts but to a greater awareness among advisors of the family offices. Inter alia, these proposals are familiar to clients and intermediaries with benefits of establishing private foundations included a recommendation for the a civil law background. As foundations, for example. introduction of foundations legislation unlike trusts, are legal entities they will, in At the outset, the main contributor will providing for the establishment of private accordance with Gibraltar’s legal tradition, be decide whether it is the intention to have foundations in Gibraltar. entered onto a public register administered by control over activity the private foundation The introduction of foundations the Gibraltar Registry. undertakes. This allows ongoing and flexible legislation provides additional choice and Foundations generally have common decisions on how the funds are to be invested flexibility for the fiduciary sector of the features including legal personality and in and distributed. financial services industry, and its clients, many jurisdictions are visible on a public It is usual for family members over whilst allowing Gibraltar to continue to meet register. The Founder, who provides the initial several generations to have a hands on role in international obligations through high assets of the foundation known as the the activity undertaken providing invaluable standards of transparency and compliance. endowment, forms them. The foundation experience and an early understanding of the holds assets for the purposes set out in its value of good giving.

STEP constitutive documents and administered The Private Foundations Act 2017 The Ministry resolved to introduce according to contractual rather than fiduciary commenced on 11th April 2017 and can be foundations and directed STEP to prepare the principles. Run by a council (or board) which viewed here: www.gibraltarlaws.gov.gi/

relevant legislation, with the help of the is responsible for fulfilling its purpose it has articles/2017-03o.pdf Government Law Offices and as part of an no shareholders and, depending upon its This Act has created consequential industry wide working group bringing purpose, may or not have beneficiaries. A amendments and these reflect in the together expertise from across the private and requirement is that at least one councillor is a ‘ following: public sectors in Gibraltar. Gibraltar resident company licensed as a 1. Income Tax Act 2010 www. gibraltarlaws.gov.gi/articles/2010-21o.pdf It is usual for family members over several generations 2. Financial Services (Conduct of Fiduciary to have a hands on role in the activity undertaken Services Business) Regulations 2006 www.gibraltarlaws.gov.gi/articles/2006s139. providing invaluable experience and an early under - pdf standing of the value of good giving 3. Financial Services (Investment and Fiduciary Services) Act ‘ Private Foundations have existed in professional trustee in Gibraltar. www.gibraltarlaws.gov.gi/articles/ Europe since at least 1926 and were Beneficiaries have contractual rights to 1989-47o.pdf introduced to provide a civil law equivalent to enforce the operation of the foundation in 4. Rates of Tax Rules 1989 www. common law trusts. Since the 1990s, a accordance with its constitutive document – gibraltarlaws.gov.gi/articles/1989s096.pdf number of common law jurisdictions rather than proprietary rights in its assets, or introduced foundations legislation, for equitable rights such as are available to www.gibraltarfinance.gi example Panama in 1991 and the Bahamas in beneficiaries of trusts. A foundation may also 2004. The Foundations (Jersey) Law came have an advisor or protector if its rules so into force in 2009, and likewise the provide. Foundation (Guernsey) Law in 2012. There is a demand for foundations No single legal definition of a domiciled in a well-regulated, co-operative foundation exists however; it may be and transparent jurisdiction.

18 Gibraltar International www.gibraltarinternational.com G

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Licensed by the Financial Services Commission No. FSC00376B Fintech Businesses using new technology showing ‘extraordinary interest’ in new controls Gibraltar’s aim to be the first financial services jurisdiction to regulate business use cases of a financial nature.” use of the blockchain technology that amongst other things gives life to Bitcoin, the virtual currency established in 2009, was the first major user of myriad crypto currencies and crowdfunding ‘tokens’, is on course to be blockchain, a type of distributed ledger of delivered at the year-end unchangeable, worldwide digitally recorded data, such as the value of goods or services, in fter three years and repeated lawyer Anthony Provasoli, a partner at packages called blocks, but as yet its use is not consultation on the proposed Hassans, told Gibraltar International . controlled in any way, including for anti- A regulatory framework, there is It was “exciting to see how Gibraltar’s money laundering (AML), and consumers c already “extraordinary” interest from firms interest in crypto-currencies and blockchain potentially are unprotected if things go wrong. wanting to set up on The Rock. The has escalated over the last couple of months” “Under the new regime we will be regu - proposed regulations for this fast-developing including from local businesses that are keen lating those firms, including for AML; we will distributive ledger technology (DLT) cover to get involved in the sector, he said, and “the be raising the bar”, Jones asserted, given that businesses that hold, store or transmit other business models presented have been varied” Bitcoin does not have legal tender status.  peoples’ value to a third party and are with people “prepared to relocate themselves designed to “stand the test of time and to be and a team of people to Gibraltar if Fully traceable flexible”. necessary.” Although ransom software temporarily The primary driver for the DLT paralysed much of the NHS and companies framework is to encourage Gibraltar’s worldwide and demanded payment in economic development. Firms and activities Bitcoin, Jones bridled: “Bitcoin is incredibly that are subject to another regulatory frame - traceable – you can follow the money work will continue to be regulated under that considerably more easily than you can with framework, but for newcomers falling within traditional payment systems - it’s open to the scope of the DLT framework, it “provides view in real time. You can be damn sure that regulatory certainty while meeting the there are a lot of people watching that Bitcoin challenge of regulating firms using nascent address and consequently the criminals have technology that is rapidly and continually not been able to take advantage of, or make evolving”. use of, the proceeds of their crime.” ( See The aim is to foster a fintech [financial Cybercrime article, p16 ) It’ll take time to As Gibraltar Financial Services technology] - and broader technology – start- Pondering how to regulate “something catchup to Commission (GFSC) head of risk and up culture and encouraging its development that arguably doesn’t exist today”, Gomez’s changes, Adam innovation, Nicky Gomez, explained: “The as a centre of DLT excellence. solution was to make the framework Vaziri of Diacle key to our approach is to allow versatility, so Among possible use cases are insurance “outcomes focused and principles based – we (right) tells GFSC’s Nicky that it can be adapted to whatever risk each claims management, inter-firm accounting have identified nine key regulatory outcomes Gomez & Siân potential business case might pose. A key reconciliation, mortgage loan applications that we want to achieve in all cases and how Jones requirement is collaboration, to ensure that, and securities custody; those not covered by they are achieved will be dealt with on a we are working together as a jurisdiction with the proposed regulation include DLT software case-by-case basis, very much bearing in advisors and potential applicants to ensure we developers, technical services providers not mind the specific of the business being understand the product and services they want controlling value belonging to others and proposed to us.” to offer to customers. investment advice about virtual currencies, Paul Astengo, a Gibraltar Finance senior “We can together then make an (but that is likely to form part of an upcoming executive, led a team that included Provasoli assessment of what the potential risks are to legislative reform programme). and David Parody, a regulatory consultant and consumers, the potential risks to the The GFSC submits: “If successful, it is former GFSC deputy chief executive to reputation of Gibraltar and what controls can intended the framework could be expanded develop the DLT proposals. be put in place by the firm to manage or miti - and applied to other new technologies with Banks have generally been unwilling to gate that risk to a level that falls within our financial applications as well as to other fund crypto currency projects and wary of risk appetite.” innovative financial products, services and virtual currencies in part, it is alleged, because At least 15 firms have approached business models.” The government will they see it as competing with their own the GFSC about establishing DLT-based appoint a specialist advisory panel, business, as well as presenting ‘know your operations, most new to the territory. comprising technology and regulation experts customer (KYC)’ challenges. “The interest has been nothing short of in the field of DLT and virtual currencies. Jon Matonis, founding director at the remarkable, mostly from people or firms Sian̂ Jones, an expert advisor to the Bitcoin Foundation, told attendees from New outside of Gibraltar, who are considering GFSC, emphasised: “We don’t intend to York, Brussels, London and Gibraltar: “In the

launching or relocating an operation here”, regulate the technology, it is the particular Continued overleaf

20 Gibraltar International www.gibraltarinternational.com

Fintech

Businesses using new technology showing a grey area, and it overcomes the problem for tors are going to check compliance of ‘extraordinary interest’ in new controls operators - given Bitcoin is a 24-hour quoted, exchanges in the currency”, Hudson assured. Continued from p20 universal currency - to ensure they will get Adam Vaziri, a regulatory lawyer and UK for instance, it is still very difficult paid.” joint founder in 2013 of Diacle with offices in anywhere for companies to get a bank account He predicted: “Bitcoin will outlast the Hong Kong, London, Isle of Man and the US if your business has ‘bit’ or ‘coin’ in its name. Euro. Having a currency exchange within a that design and develop fintech blockchain Banks care about KYC procedures and that regulated jurisdiction will be a big ventures, as well as compliant Initial Coin you are regulated in another jurisdiction, but advantage.” Offerings (ICOs), stated: “I’ve been trying to that doesn’t fit easily with Bitcoin given Michael Jack Hudson, 30 years old chief bring business ideas that are extremely dis - transactions are anonymous. executive of Bitstocks, established as a ruptive into the mainstream – financial servic - “A lot of people are in the queue to be Gibraltar company in April, pointed to new es industries that are safely regulated using regulated in Lithuania, Gibraltar and Japanese legislation where retailers have a this blockchain technology. Luxembourg – probably the top three in 10% tax break for use of Bitcoins with the Most exciting were “tokens offerings - Europe for crypto currency regulation.” added advantage of having no exchange Initial Coin Offerings (ICOs) - that are the Matonis declared there were 500 Bitcoin commission to pay. “It’s in the very early equivalent of an IPO (Initial Public Offering) currency exchanges worldwide that “play a stages, but it is a huge incentive for retailers to for a company’s stock, but where the vital role, because they give stability, increas - start using Bitcoin.” company has not yet traded. “Crowdfunding ing liquidity and less volatility; and they give is the second biggest application of access - effectively a bridge with national fiat Central database blockchain technology and ICOs are a way to currency”. Exchanges in Bitcoin "make To assist with regulation, he suggested estab - raise money for a new product, leveraged via money whether the price is going up or down; lishing a centralised database of companies the public blockchain; roughly five ICOs a they are profitable from the start, they don’t using the system - “we still have to assign month each raise an average US$5-10m and need to look at external funding.” names to customers and although there is the ICO ‘hot spots’ are Singapore and Matonis said: “Bitcoin also allows need for some financial privacy, if it is on a Switzerland.” [exchanges] to operate in unregulated public system there needs to be some KYC, Although ICOs were a new trend, “it is markets, not because it is illegal; it just means and it needs to be regulated”. With the addi - not sustainable to have, for example, US$20m they are currently unregulated, so they are in tion of crypto currency exchanges, “regula - raised [in this way], without any anti-money

22 Gibraltar International www.gibraltarinternational.com Fintech laundering (AML),” Vaziri contended, blockchain they will not exist in any other of their operation and to be completely trans - adding: “I cannot conceive of a situation form!” parent concerning any risk in relation to their where cash is anonymously recycled without Vaziri asked: “Will we get model smart operation, and to be able to sustain and any control.” contracts for company incorporation, for develop their business.” Vaziri reminded that the US required a issuance and transfer of shares downloaded Siân Jones, who also runs COINsult and license to issue crypto coins and the EU was from a registry and published using is a founding member of the UK Digital expected to do so also under a blockchain?”, noting “from a legal Currency Forum, maintained: “Of course AML4 Directive. “Regulation standpoint, it will take time for reg - there are risks, but also there are huge risks in will force issuers into the ulation to catch up.” not doing anything. Most jurisdictions have mainstream, by having a ‘white taken a ‘wait-and-see’ attitude – the EU is an list’ within smart contracts with Digi tokens example. In all likelihood in the first quarter addresses, so that people can revolutionise of next year any business already established register”, he suggested. He claimed: “With digital tokens in Gibraltar and covered by the regulation will “We have seen lots of ICOs that are immutable and that are be able to continue operating and will have a in this area, so make ICOs easy representative of shareholdings, 3-month period in which to submit an in the token market in Gibraltar we can develop use of application to the GFSC.” and across the board in every blockchain with zero regulatory Other jurisdictions also aimed to attract jurisdiction; in the Isle of Man it friction that can revolutionise the DLT users, but she proclaimed: “We can is already done – hopefully, it Escalating interest in crypto efficiency and security of company maintain the lead in this area. No other also will be in Gibraltar!” currencies & blockchain: transactions.” jurisdiction has yet imposed a regulatory A Delaware proposal to Anthony Provasoli. The GFSC’s Gomez recog - framework for financial services using DLT. issue shares on blockchain “will certainly rev - nised that “this technology is still evolving Given that we have spent time in developing olutionise the way shares are issued and and is in its infancy and we have to be innova - this particular framework, we will see others records maintained”, he observed. Unlike tive”. He said: “The principles of our regula - copy us in terms of the detail or approach that shares that are issued in a certificated form tive approach to a large extent mirror the rules has been taken, but I think we are head and and regulated, “I believe we are going to have we have that cover financial services entities. shoulders above any other jurisdictions.” companies that are incorporated, but using We expect firms to put customers at the centre Ray Spencer

www.gibraltarinternational.com Gibraltar International 23 Cybercrime

Establishing ‘community of partners’ stupid things, and we need to educate them.” to combat internet crime It was important to engage with staff, Continued from p16 who frequently were bored by ‘information’- There was some positive news, he felt, type training session. He suggested: “Focus given that the hackers behind WannaCry on the folks at home and the things that [thought to be from North Korea] “may have matter to them – operating bank, eBay and killed the golden egg; because of the global PayPal accounts, Amazon and Netflix attention everyone is well aware of it”, so applications, social networks – and encourage there was more focus by businesses and changes to the way they behave!” organisations to ensure software update Smith offered small incentives or prizes patching was done and files backed-up and for employees to attend awareness sessions kept off-line to help recover from an attack. that “encourage them to be more cyber Governor Davis at cyber security - Autumn 17 He revealed that most people who paid a savvy”, presenting small, fun competitions to total of an estimated US$1bn “didn’t get their make the underlying security message more accounts being compromised” he suggested is data back and so bizarrely broke the trust interesting. Most were unaware of to add a prefix and final letter to the existing model that ransomware relies on – honest ‘HaveIBeenPwned?’ – a UK government password that corresponds to the account – a criminals”. supported free website that indicates if an ‘p’ and ‘l’ for a PayPal account, for example. email address has ever been hacked for Richard De Vere, director of ethical Disgruntled employees personal details stored on-line and that can social engineering consultancy at The Disgruntled or uninformed employees also keep people informed in case of future AntiSocial Engineer, also advocated making represented a particularly vulnerable area for malicious attempts. “There were stacks and internet security relevant to individuals in companies as research indicates that more stacks listed!”, Smith noted, as surprised staff their workplace and personal lives. ”A short than 70% of security breaches are by staff. entered both work and home email address. password takes a hacker seven minutes to Anthony Smith, responsible for He strongly advised against using the crack – a long one of say, 20 characters, takes Northumberland Water internet security, same password to log into multiple sites, but many years, so use a combination of letters, maintained: “It’s not stupid people; it’s “if you insist on having one password or very characters and numbers.” normally very switched-on people doing few a good way to reduce the threat of And drawing attention to general apathy

24 Gibraltar International www.gibraltarinternational.com Cybercrime towards programme updates for computers, made on social media and business contact “Today there is a real shortage of qualified tablets and mobile ‘phones, but De Vere sites, such as Linkedin. people and more need to be trained given that emphasised: “They almost always contain a “Social engineers, unlike with a a recent survey found 70% of hiring managers security patch to further defend against hacks, technical attack, are low risk with high needed more cyber security personnel.” even when the software enhancement listed reward; they leave very little footprint, but To overcome the skills gap, employers may not seem to be of interest. always are a threat. People think they are not should look well beyond those with obvious “These things can make a world of important enough or don’t have enough training in computer sciences, software difference to your security and it is worth money, but the easiest way into companies is engineering and mathematics, and spot people encouraging all staff, family and friends to though their people”, Radcliffe cautioned. with the right aptitude to working in the cyber apply them to reduce dramatically the Presenters also reminded of the need to world, and they could come from a wide range opportunity for hackers to access your back up computers and systems regularly, and of educational disciplines, Davis urged. business, home or mobile devices”, he to always unplug external portable devices – Ian Trump, head of security at Zonefox. concluded. hard disc, pen drives - because cyber attacks which helps identify insider weaknesses Jenny Radcliffe, an ethical social on a computer spread to connected devices. utilising ‘user behaviour analytics’, coun - engineer, at the London Digital Security selled: “Don’t mistake a breakdown in your Centre, noted: “The people hackers want to Follow easy steps [internet] system as always being the result of get at things that we want to keep private Adrian Davis, managing director Europe, a malicious act. IBM research has shown that through social engineering – a psychological Middle East & Africa, for (ISC)², a 95% of breaches in security were by tool used alongside the technical tool – to get non-profit organization specialising in individuals with no criminal intent.” inside someone’s brain to take logic off the information security education, observed: Governor Davis reminded: “Ultimately, list.” “Many of the major incidents we have been Gibraltar’s cyberspace enterprise will only She made the point: “I have seen, first involved with recently would have been a lot realise its full potential if we transform our hand, how easily human beings can be led to less damaging had organisations followed individual and collective security behaviours, talk too much, trust too much and will open some basic security steps.” institutional security culture and social the company to [online] attackers, for all sorts The dramatic rise in computer-based security responsibility in tandem with the of reasons”. Personal and professional details attacks worldwide “will open the floodgates game-changing technological advances that easily could be revealed through remarks for cyber security–related jobs”, he said. are now so profoundly apparent.” . e n o N

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www.gibraltarinternational.com Gibraltar International 25 Funds Gibraltar Funds & Investments Association (GFIA) regularly to provide its members with news which liaise directly with their relevant GFIA is a non-profit organization. and information on existing and new members. It was formed in 1996 under the legislation affecting the financial services The Association held its Annual original name GASIM (Gibraltar sector. The organization maintains a strong General Meeting on 30 June 2017, exactly relationship with Gibraltar´s regulatory 53 weeks after the UK voted to leave the Association of Stockbrokers and bodies to provide the best and most up to European Union. What an exciting first year Investment Managers) date information. This is achieved through for its Executive Committee which braced the implementation of the “technical the challenging situation to identify and to n 2009 it was renamed to include Fund sub-committee” which meets regularly to extract as many opportunities as possible for Managers. GFIA´s membership today is discuss current laws and updates within the the Gibraltar financial services sector and Icomprised of stockbrokers, law firms, sector. GFIA’s members. banks, brokers, audit firms, investment managers, fund managers, administrators Executive Committee MiFID II and (licensed) EIF Directors as well as The Association has currently more than 100 There are several challenges that the individuals involved in the financial services active members and the current Executive Association is currently facing. In the Brexit sector in Gibraltar. Committee was elected in June 2016, the day context, the priority is to reposition the The majority of members of GFIA are after the Brexit-Vote. Their mandate runs for jurisdiction in a wider framework, to try to licensed under the Gibraltar Financial two years. It is formed by ten sector anticipate what the landscape will be like, Services Commission (GFSC) and are representatives and a treasurer. To provide once the UK has left the European Union, in rigorously compliant with local regulations each sector group with the best support, eight order to remain attractive and competitive on enforced by regulatory bodies. GFIA works specific sub-committees have been created a global basis. Then, there is the

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26 Gibraltar International www.gibraltarinternational.com Funds introduction and implementation of MiFID II Chairman Adrian Hogg in 2018. Vice Chairman James Lasry The first task that the Executive Treasurer Moe Cohen Committee decided to engage with was the regime of investment funds. This is run joint - Training Sub Committee Johann Olivera ly with the active cooperation of the GFSC Marketing and Events Sub Committee David Diez de Artazcoz and the Finance Ministry. The “Private Technical Sub Committee Joey Garcia Scheme” and the “Experienced Investment Investment Managers Sub Committee Raymond Joubaud & David Diez de Artazcoz Fund” regimes went through an important Administrators Sub Committee Benjy Cubby reform with the aim of strengthening and Auditors Sub Committee Johann Olivera enhancing GFIA’s offering in a non- Lawyers Sub Committee Jay Gomez European context. EIF's Directors Sub Committee James Neave Banks Sub Committee Derek Baglietto Transaction Reporting It has been followed by the organisation of The marketing area recently went members’ interests and we are looking training and information sessions around the through an important reshuffling. A forward to continuing close co-operation MiFID II regulation in cooperation with the ‘Brochure’ and ‘Welcome Pack’ for new with the GFSC, the Finance Centre and the working group which was created by the members has been created. The Association Government of Gibraltar to promote the GFSC and representatives of several industry organise a ‘Social Meet-Up’ on a quarterly jurisdiction within Gibraltar as well as associations. At GFIA level, Investment basis and our annual members’ event will beyond the borders. Brexit and other political Managers and Broker Dealers are the ones change its format from a very traditional outcomes offer significant opportunity for a most concerned by the introduction of black-tie gala dinner, to an ‘Oktoberfest’ with flexible jurisdiction, such as Gibraltar. MiFID II. ‘Transaction Reporting’ and a charitable focus due to be held in October ‘Knowledge and Competences’ are the two this year. GIFA has also released a brand-new subjects that have encountered the biggest website: www.gfia.gi interests during seminars. The working group The current Executive Committee has a will continue to work on these issues. further year to continue to serve our

www.gibraltarinternational.com Gibraltar International 27 BUSINESS ROUND UP

GII annual dinner the CII and Gibraltar University. do business with the bank. Teams clearer with our customers about Gibraltar students taking a In the past decade there has will continue to deliver the same who they’re banking with. We Chartered Insurance Institute (CII) been over 100 technical training level of service that customers have welcome this change as it allows us on-line course this year achieved a courses, the GII’s raison detre. come to expect. to be more distinctive in the 69% pass rate compared with UK Provedano’s aim, she told dinner The ring-fencing legislation jurisdictions in which we operate.” entrants’ 45%, revealed Lorraine guests at the Sunborn Hotel, is to requires RBS International to Provedano, president of the “help build professional stability separate essential banking services Freedom to roam Gibraltar Insurance Institute, at its and investment in local from investment banking services Gibtelecom announced in June the professionalism”. by 1st January 2019. It was brought abolition of roaming surcharges for in by the UK Government to Gibtel customers, using their mobile Change of trading name strengthen the financial system phones in the UK, Spain and other for NatWest following the financial crisis of European Economic Area (EEA) Due to ring-fencing legislation in 2008. It reduces the possibility that countries. The new ‘Roam like the United Kingdom, RBS essential banking services are put at Home’ tariffs, will now mean that International has changed its trading risk by a failure in another part of Gibtel customers will be able to use name from NatWest to NatWest the business, such as investment their inclusive minutes, data and International in Gibraltar, the banking. SMS’s on their mobile phones, Channel Islands, and the Isle of Heidi Le Miere, Head of anywhere in the EEA with no Man. Brand & Marketing commented: additional costs. There is no change to its “The introduction of ring-fencing Gibtelecom’s CEO, Tim annual dinner attended by 212 banking services or how customers gives us the opportunity to be Bristow, commented: “The people from 24 companies in June. implementation of ‘Roam like The ten year old local institute, Home’ will provide great value to which began with 50 members and our customers, who can now benefit now has over 400, is developing a from up to 1000 voice minutes and fast-track Diploma programme with 10 Gigabytes of mobile data whilst

Perspective matters

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28 Gibraltar International www.gibraltarinternational.com BUSINESS ROUND UP travelling in Europe (dependent on the firm for over 20 years and she is US Congressmen visit all serve on the Appropriations their mobile plan) without having to an extremely experienced trust and Gibraltar Committee. worry about roaming fees”. estate practitioner. A delegation of three members of The Congressmen thanked the the United States Congress visited Government and the people of Gibraltar in July, for a fact-finding Gibraltar, for hosting the United mission. States Armed Forces at different points in history, New appointments at Joanne with 16 years client including Abacus relationship experience and a during World Abacus is pleased to announce the financial advisory background, War Two, up to appointments of Tanya Hurtado, heads the Abacus Wealth the present day. Joanne Rodriguez and Natalie Management and Business During a Adamberry to the position of Development team, delivering meeting with Associate Directors. consistent value for the firm. the Chief Tanya has been a stalwart with Natalie has been with Abacus Minister, for six years and she is a full Fabian Picardo member of the Association of and Deputy Chartered Certified Accountants and Committee Chair Chief Minister, Dr Joseph Garcia, at expertly leads the accounting team. Congressman, Rodney No 6 Convent Place – Mr Picardo Her experience in the field is Frelinghuysen (Republican New briefed the delegation on the fundamental to the firm’s success. Jersey), and Congressmen, Ken political and economic position of The Abacus Board believes Calvert (Republican, California), Gibraltar and reiterated the policy of that these appointments will Peter Visclosky (Democrat, the government that the US Armed continue the strong and exciting Indiana), who is also the ranking Forces were very welcome in development of the business. member on Defence Appropriations, Gibraltar.

www.gibraltarinternational.com Gibraltar International 29 WHY SHOULD YOUR COMPANY SPONSOR OR ADVERTISE IN THE GIBRALTAR INTERNATIONAL MAGAZINE? Answer: l We produce a quality, informative, business publication, with the aim of informing and encouraging international companies and investors to choose Gibraltar to invest and do business with your companies

l 10,000 Printed Copies Each Quarter, of which 2000 are mailed to Financial Advisers, Bankers, Lawyers, Accountants, HNWIs, across the UK and Continental Europe *

l Exclusive Business Magazine Stands in the Arrivals, Departures and Calpe Lounge at Gibraltar International Airport ( 2,500 copies on average taken each quarter) - Gibraltar World Trade Centre - Europort - Atlantic Suites - Ocean Village Business Centre - Cruise Liner Terminal - Sunborn Hotel Business Centre

l Distributed in all the Top Hotels, Restaurants, Bars and Office Receptions in Gibraltar

l Distributed through the Government of Gibraltar (UK) offices, The Strand, London

l Sponsors receive special rate for adverts

l Direct link to your company’s website, from our website – www.gibraltarinternational.com (Sponsors only) * Mailing list compiled in association with Gibraltar Finance, HM Government of Gibraltar



Why not treat yourself to VIP treatment & to a real slice of luxury...

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30 Gibraltar International www.gibraltarinternational.com Professional Bodies based in Gibraltar Gibraltar Association of Pension Fund Administrators (GAPFA) Gibraltar Federation of Small Businesses Ltd (GFSB) Gerry Kelly, Chairman, Tel: + (350) 200 76173 Gemma Vasquez, Chairwoman, Tel: + (350) 200 47722 Email: [email protected] Email: [email protected] Association of Trust & Company Managers (ATCOM) Gibraltar Funds & Investments Association (GFIA) Nick Cruz, Chairman, Tel: + (350) 200 50418 Adrian Hogg, Chairman, Tel: + (350) 200 45502 Email: [email protected] Email: [email protected] Bar Council Gibraltar Insurance Association (GIA) Keith Azopardi, Chairman, Tel: + (350) 200 79423 Liz Quinn, Chairwoman, Tel: + (350) 200 74570 Email: [email protected] Email: [email protected] Gibraltar Association of Compliance Officers (GACO) Gibraltar Insurance Institute (GII) Carlos M. Martins, Chairman, Tel: + (350) 2000 2022 Lorraine Povedano, President, Tel: + (350) 54003732 Email: [email protected] Email: [email protected] Gibraltar Bankers Association (GBA) Gibraltar Society of Accountants (GSA) Benjamin Moss, President, Tel: + (350) 200 44144 Desiree McHard, President, Tel: + (350) 200 47300 Email: [email protected] Email: [email protected] Gibraltar Betting & Gaming Association (GBGA) Society of Trust & Estate Practitioners (STEP) Peter Howitt, Chief Executive, Tel: + (350) 200 68450 Peter Isola, Chairman, Tel: + (350) 2000 1892 Email: [email protected] Email: [email protected] Gibraltar Chamber of Commerce (GCC) Chartered Institute of Personnel & Development (CIPD) Christian Hernandez, President, Tel: + (350) 200 78376 Lesley Louise, Chairwoman, Tel: + (350) 54428000 Email: [email protected] Email: [email protected] Gibraltar Finance Centre Council (GFCC) Gibraltar Electronic Money Association (GEMA) Stephen J. Reyes, Chairman, Tel: + (350) 200 41200 Dani Spier, Chairman, Tel: + (350) 200 79645 Email: [email protected] Email: [email protected] For all the latest Gibraltar business news visit www.gibraltarinternational.com

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