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.
