Guernsey is continuing to build on its position as a BEPS-compliant jurisdiction, according to Guernsey Finance.
A year ago the island established a base erosion and profit shifting (BEPS) working party to assess the OECD’s October 2015 BEPS Action Plans and scrutinise the EU Commission's BEPS Directive.
The working party is chaired by Guernsey's Chief Minister, Deputy Gavin St Pier, and includes Guernsey Finance Chairman Lyndon Trott and representatives of the Guernsey Institute of Directors and the Guernsey Society of Certified and Chartered Accountants.
Discussions between the working party and local businesses have shown that Guernsey is already largely compatible with the BEPS actions. Its finance sector model and regulatory framework prevent the island from being exploited significantly for BEPS and ensure equivalent outcomes to those the OECD and EU Commission are seeking to secure.
Guernsey has taken five key steps:
• Joined the BEPS Inclusive Framework, through which it is committed to the development and implementation of global standards in line with the BEPS Action Plans
• Accepted an invitation from the OECD to join the ad hoc group on the multilateral instrument. Guernsey is one of a very small number of non-states invited to join the group and has helped draft the instrument and ensure it is effective
• Committed to signing the BEPS Multilateral Instrument (in June 2017) in order to implement tax treaty-related measures to combat BEPS
• Signed up to the Multilateral Competent Authority Agreement to assist with the sharing of relevant information in relation to country by country reporting (CbCR), as well as broadly adopting the OECD's CbCR implementation package, to facilitate its implementation of this BEPS minimum standard
• Put in place the relevant implementing regulations for CbCR.
"Guernsey is already in a leadership position on tax transparency, and we are very well placed on the evolving BEPS international standards," said Deputy St Pier. "Our position as a BEPS-compliant jurisdiction is important for the global tax transparency agenda and provides stability, competitiveness and opportunities for our finance sector.
"It is acknowledged that Guernsey, as a third country with a strong financial services sector, will be involved throughout 2017 in an EU-Code Group process that will assess third countries against the EU’s updated good governance criteria.
“Guernsey welcomes this as an opportunity to further demonstrate that it meets international good governance standards in relation to transparency, automatic exchange of information and fair and competitive taxation."