The Channel Islands are situated
in the English Channel, approximately 14 miles from the coast of
Northern France near the Cherbourg peninsula.
Their constitutional position
results from the annexation of the Islands to The Duchy of Normandy
when Duke William II of Normandy conquered England in 1066 and,
when the rest of The Duchy reverted to France in the 13th century,
they stayed loyal to the English Crown and have remained so ever
since. This Norman origin has given the Islands a considerable
measure of independence within the British Isles and they have
retained many special laws and customs.
The main Islands are Jersey,
Guernsey, Alderney and Sark and each has its own unique system of
independent government stretching back over many
centuries.
The Island of
Jersey
Jersey is the largest of the Channel Islands, having an area of
about 45 square miles and a population of almost 88,000
inhabitants.
The Island is governed by an
elected non-party parliament known as 'The Assembly of the States',
which has responsibility for all domestic matters.
In recent times while other
financial centres throughout the world have suffered political and
economic upheavals, Jersey has continued to enjoy political and
economic stability. Consequently, Jersey has expanded rapidly as a
banking and financial centre of international repute. Banking has
acquired an importance, and a prestige, in Jersey that could
probably not be matched anywhere else in the British Isles outside
of the City of London.
Taxation
The primary attraction of Jersey as an international financial
centre is its low taxation. The standard rate of income tax is 20%
for residents of Jersey and this has remained unchanged since 1940.
There are no Death Duties, Capital Gains Taxes, Wealth Taxes or
Gift Taxes.
All interest is paid without
deduction of tax and bank interest on deposits from persons not
ordinarily resident on the Island would not be assessed to Jersey
income tax.
Currency
The currency of Jersey is Sterling, but the Island issues its own
notes and coins at par with those of the United Kingdom, these
being legal tender in all of the Channel Islands.
Confidentiality
Strict observance of bank confidentiality ensures that customers'
affairs are at all times handled with the utmost
discretion.
All bank records are produced
and maintained in Jersey, thus ensuring complete confidentiality of
all financial affairs.
Jersey and the European
Union
The Island is not a separate member state nor an associate member.
For the provisions of the EC Treaty relating to free trade in goods
the Island is 'within' the Community but, for example, those
relating to fiscal harmonisation and financial services, the Island
is treated as a 'third' country.
Island based institutions are
unaffected by EC fiscal harmonisation measures or the requirements
of financial service directives (e.g. exchange of information
agreements).
Through the monetary union with
the United Kingdom the provisions in the Treaty relating to the
free flow of capital throughout the EC, and between the EC and
third countries, are enjoyed by the Island.
The Island's position 'Offshore
Europe' is considered to be in the best interests of the Island as
a finance centre. It is particularly well placed to provide a
quality service that is in demand by those who are in search of
political and fiscal stability and have a preference for an
offshore location with a reputation for applying international
prudential standards.
