Entente Cordiale is Restored

The States of Jersey have confirmed the French government has agreed to remove Jersey from their non cooperative territories list. Details of the announcement follow:

François HollandeThe French Government announced today (20th December 2013) that Jersey is no longer considered to be non-cooperative in the exchange of tax information and that France will not be applying a withholding tax on French business with the Island.

In August 2013, the French Government placed Jersey on a list of jurisdictions considered non-cooperative in the exchange of tax information. The repercussions of that decision would have been an imposition of sanctions by the French Government on all French business with the Island, to be brought into effect from 1 January 2014.

Since August, Jersey has sought to demonstrate to the French authorities that the Island is fully committed to cooperative exchange of information under Tax Information Exchange Agreements (TIEAs), including the Jersey/France agreement. The Government of Jersey has reviewed the processes it uses to deal with tax information requests, and subsequent changes to the law now limit the ability of those who are the subject of a TIEA request to appeal to the Jersey courts.

Effective exchange of tax information

Responding to the French Government’s announcement today, the Minister for External Relations, Senator Sir Philip Bailhache, said "Ministers and officials from the Chief Minister’s and Treasury Departments have made great efforts to meet the concerns of French Ministers. I am very pleased that these efforts have borne fruit. We have always seen ourselves as a cooperative jurisdiction, a view shared by the organisations responsible for setting international standards, and we have been confident that we would be able to convince the French Government to share this view.”

The Treasury and Resources Minister, Senator Philip Ozouf, said "Our competent authority will remain in close contact with their counterparts in France to ensure that we continue to work effectively together on tax information exchange.

“Had the blacklisting sanctions been applied from 1 January 2014, the impact on Jersey’s finance industry would have been disproportionate. The news that the sanctions will not be applied will be warmly welcomed in Jersey."

UK Government support

The Chief Minister, Senator Ian Gorst, said "This result follows significant efforts by the Government of Jersey and its officials, and I would like to express my thanks to all concerned. The strong support that we have had from the UK Government has also been greatly appreciated.

“Jersey has been working hard to ensure that we meet the criteria set by France, and I welcome today’s announcement that France has removed us from the list.”

This is welcome news and a recognition of the significant steps Jersey has taken to augment even further its information exchange arrangements, described by the OECD as cooperative and responsive.

Whilst this temporary listing has been inconvenient, it has facilitated a closer dialogue with France giving Jersey the opportunity to prove beyond any doubt its commitment to both the letter and spirit of these agreements. This can only help our relationship with this important G20 member going forward.

 

Further reading:

Jersey Finance welcomes confirmation of removal from French list of non-cooperative jurisdictions (Jersey Finance press release)

France announces removal of Jersey from list of non-cooperative jurisdictions (States of Jersey press release)

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