Conference round-up

  • Date : August/September
STEP Geneva Conference
ABOUT THE REVIEWERS: Julien Dif TEP is a Partner at Bonnard Lawson in Geneva and Branch Chair of STEP Suisse Romande, and Cécile Civiale Vuillier TEP is Managing Director of Bedell Trust Suisse SA and Vice-Chair of STEP Suisse Romande

STEP’s Geneva Conference took place on 7 May 2012, when Switzerland was at the centre of several major international controversies in the wealth-management industry. Despite this, more than 140 delegates attended the conference, which was held at the Hotel President Wilson in Geneva.

Expert speakers included Richard Hay (Stikeman Elliott), Jean-Philippe Krafft (Rhône Trust and Fiduciary Services), Xavier Isaac (Investec Trust Jersey), Judith Chatoo (Coutts and Co), Prosecutor Deputy Dario Zanni and Geneviève Berclaz (BRP Bizzozero and Partners).

Richard Hay opened the show with a dissection of the new wave of global tax regulation, particularly so-called tax transparency and the push for automatic disclosure. Switzerland’s success in financial services is bound to expose it to scrutiny, he said, but is it just a Trojan horse invented by rival jurisdictions to create a commercial advantage for their own financial sectors?

Hay pointed out, for example, that the US receives capital flight from Latin America without asking whether tax has been paid on it, while the untracked ownership of limited companies in Delaware and other states is a scandal. Switzerland must respond, he said, by protecting its tax neutrality while keeping pace with applied global standards.

Jean-Philippe Krafft explained the complexity of Switzerland’s new withholding tax agreements with Germany, Britain and Austria. The variety in clients’ circumstances means that special cases and exceptions abound.

It is likely that few people outside Switzerland knew that the country’s criminal prosecution system underwent sweeping changes this January, with the abolition of investigating magistrates in favour of an all-powerful Public Prosecutor’s office. One of its senior staff, Dario Zanni, briefed conference delegates on how this will affect prosecutions involving trusts – 90 per cent of which are money laundering cases. He warned attendees of the office’s extensive powers. Its authority cannot be challenged and it cannot be sued for damages.

Zanni said Switzerland ‘absolutely needs’ foreign cooperation, and in return the Swiss authorities generally collaborate with international criminal assistance requests. For trusts, the most frequent requests are for freezing of bank assets, seizure of bank documents, and searches of a bank or fiduciary company premises.

And according to Zanni, reports of the death of Swiss banking secrecy have been exaggerated. It is still a Swiss public right protected by law, and can only be breached if it is necessary to detect a crime where specific indications to investigate already exist. ‘No fishing expeditions’ remains the Swiss mantra in this context.

Geneviève Berclaz described how the Swiss financial regulator FINMA has adapted to the recent international attack on banking secrecy, which culminated in US Department of Justice proceedings against UBS and Crédit Suisse. FINMA has had to steer a course between requiring banks to protect themselves against these legal and reputational risks, and not being seen to apply foreign law in Switzerland. So it has imposed a stricter risk-mitigation regime on banks, whose management must now control the risks they run when conducting business in foreign jurisdictions. If they fail, said Mme Berclaz, they will violate FINMA’s fit and proper person requirement.

Panel discussions with experts Stella Mitchell-Voisin (Summit Trust International), Benjamin Mushokoza (Favona SA), Michael Wells-Greco (Maitland), Luc Thévenoz (University of Geneva), Stéphanie Jarrett (Baker & McKenzie), Adrian Escher (Kendris) and Tracy Tepper (Lombard Odier Darier Hentsch Trust Bermuda Ltd) offered practical solutions in patrimonial structuring and answered questions on regulation of trustees, fiscal responsibility, exchange of information, judicial cooperation and professional liability. The debate is to be continued, and we look forward to seeing you on 29 April 2013 for the next episode.

The conference was a tremendous success, which we dedicate to and share with those who supported us and helped to obtain such results: organiser VisionCompliance SA and sponsors Hottinger Group (presenting sponsor), Ace International (gold sponsor), Gam (silver sponsor), AP Executive (coffee-break sponsor) and Swiss Life (cocktail sponsor). We also would like to thank Genève Place Financière and Banque & Finance magazine for their support.

STEP South Africa Conference
ABOUT THE AUTHOR: Harry Joffe TEP is Head of Legal Services at Discovery Life and branch secretary of step johannesburg

The first STEP conference to be held on the African mainland was eagerly awaited. In the end, 150 delegates attended, which gave much hope for the future development of STEP in this region.

The conference began with an entertaining keynote address by Judge Zulman, with his comments on the Supreme Court of Appeal judgment in the Badenhorst case. This was followed by Prof V D Westhuizen giving a detailed review of common errors in South African trusts, looking at South Africa’s system of Roman Dutch law. Two of STEP’s most accomplished and frequently heard speakers, Nick Jacob and Richard Pease, then spoke on trusts and divorce, and tax information exchange treaties. The delegates were taken to lunch by a brief panel discussion on case studies illustrating good reasons for setting up trusts, by Mervin Messias, Harry Joffe and Prof V D Westhuizen.

After lunch there were successive breakout sessions on Mauritius, Seychelles, the UK and the Channel Islands, and the first day was completed with a summary of STEP Worldwide’s activities and upcoming plans. One of the highlights of the first day was the inspirational after-dinner talk by Yusuf Randera-Rees on how the poor of South Africa have great talent, which is being developed into successful businesses by his ‘incubator’ company.

Day two was begun by Prof Michael Honiball, who went into detail on the tax dangers South Africans face when emigrating to the US, particularly when they have trusts. He was followed by Harry Joffe, who looked at six recent South African trust court cases, illustrating the nuances of South Africa’s Roman Dutch legal system, particularly when applying to changing of beneficiaries and attempting to hold a trust to a contract signed by its trustees. Nick Jacob and Richard Pease then gave an entertaining talk on practical war stories on trusts, to which everyone could relate. Assad Abdullatiff got everyone through to lunch with a well-researched roundup of some of the most interesting offshore trust court cases from the past year.

After lunch, breakout sessions on STAR and VISTA trusts, foundations and sham trusts were well attended, and the conference concluded with a fascinating presentation by Steve Watson on the positive predictions for African growth in the next decade and the case for investment in Africa. Sponsors AFRASIA, CIM and Bedell kindly handed out prizes in a business card draw.

The conference gave the many foreign delegates an insight into the unique nature of South Africa’s trust law, and, with many delegates staying on for an extra day, a brief glimpse into the workings of Johannesburg, Africa’s richest city. It also provided local delegates with an opportunity to update their knowledge on both South African and international trust matters, as well as giving all present an excellent opportunity to network.

Delegates were delighted to hear that due to the success of this conference, it will become a regular event, and next year’s Southern African conference will be held in Mauritius in March 2013.

STEP Pacific Rim Conference
ABOUT THE REVIEWER: M Katharine Davidson TEP is a Partner at Holland & Knight LLP and branch programme officer of step los angeles

The fifth annual STEP Pacific Rim Conference was held on 3-4 May 2012 in Santa Monica, California, produced by the West Coast branches of STEP USA. The conference featured experienced and knowledgeable speakers from jurisdictions with an impact in and around the Pacific Rim, and drew participants from around the world.

The two-day conference began with a panel discussion on marital property regimes in France, England and Wales, India, the US and under Shariah law. The panel highlighted differences that often arise in civil-law, common-law and community property jurisdictions, as well as nuances for the Hindu undivided family and interests under Shariah law. The now yearly ‘Inside the Beltway’ session provided a technical update and explored developments in international tax enforcement. Other panels addressed family business succession, and planning and compliance for individuals with dual nationality. This year featured two workshops on cross-border planning for private clients and their businesses, focusing on China, Hong Kong, India, Mexico, Latin America and the US. Two technical clinics were also offered: the use of income and estate tax treaties, with the Canadian, UK and Japanese treaties as illustrations; and an analysis of US income tax issues addressing foreign trust distributions and PFICs. Two roundtable discussion groups were held on the last day of the conference; one featured Thomas Collins, Group Territory Manager, Internal Revenue Service, on a panel covering the IRS Global High Wealth Industry Group and the scope and approach of its audits, and the other examined FATCA withholding.

“The conference featured a sunset cocktail reception overlooking the ocean”

Clifford Ng of Hong Kong, our luncheon speaker, gave an educational presentation on private client planning in Asia, noting the growth of high-net-worth individuals there. Clifford addressed legal and practical issues to consider when advising residents of Hong Kong, Singapore and China.

Once again, the conference provided time for attendees and presenters to network and mingle with new and old acquaintances, including a sunset cocktail reception overlooking the ocean.

We are grateful to our sponsors, whose generosity makes this event possible.

We hope you will join us next year for the sixth annual STEP Pacific Rim Conference.

STEP Cyprus Conference
ABOUT THE REVIEWER: Celia Pourgoura TEP is a Barrister at Law and Director of CA Advocates (Pourgoura & Aspri LLC)

Limassol was the city chosen to host the first STEP international conference in Cyprus, on 10-11 May 2012. The two-day event was sold out, with more than 180 professionals in attendance from all corners of the world; a clear illustration of the growing attraction of STEP conferences.

The STEP Cyprus Conference was an opportunity to hear distinguished guests speak on issues such as the amended international trust law in Cyprus, beneficial ownership, family governance structures and tax planning for numerous jurisdictions, including Israel, South Africa, India, Russia and the CIS.

A warm welcome by STEP Cyprus Branch Chair Peter Economides opened day one of the conference. STEP Chairman Michael Young’s presentation followed, welcoming the audience to Cyprus and confirming once more that education lies at the heart of STEP.

Cypriot Minister of Finance Vassos Shiarlis delivered an important message that Cyprus is and will remain an attractive jurisdiction for inward and outward investments. The Minister revealed that nearly 80 per cent of the gross domestic product of Cyprus now comes from the provision of services, among which finance plays a key role. ‘Not only will we preserve the tax regime in Cyprus, but we will continue to improve and enhance it,’ Shiarlis said.

Peter Economides and leading lawyer and former MP Maria Kyriakou gave comprehensive presentations about new developments and amendments to the international trust law in Cyprus.

Other presentations included an analysis by Richard Pease of Lenz & Staehlin of the survey of trusts in selected countries, and Stephen Gray, Attorney and Counsellor, on citizenship and tax programmes in the legislation of several countries.

Neophytos Neophytou from Ernst & Young stressed the importance of substance where a Cyprus company has its control and management in Cyprus. Nicholas Jacob of Lawrence Graham LLP presented on the importance of family governance and adequate implementation to accommodate the future in the protection of private wealth.

Demetra Kalogirou, Chairwoman of the Cyprus Securities and Exchange Commission, gave a thorough review of the law and regulations of investment firms in Cyprus. Following this, a panel discussion answered audience questions and presented a narrative analysis of investment funds in Cyprus.

Drawing day one to a close, Leon Harris of Harris Consulting & Tax Ltd delivered a speech on the economy and growth of Israel and the importance of Israeli taxation.

Day two began with Panikos Tsiallis of PwC addressing the benefits of Cyprus and giving examples of corporate structures, followed by a panel discussion. It was evident from the discussion that a Cyprus holding company is a preferred solution for jurisdictions such as South Africa, India and CIS countries. Olga Boltenko of Withers LLP gave an interesting analysis of the protocol between Cyprus and Russia and amendments to the double-tax treaty. The presentation also referred to the exchange of information between Russia and Switzerland.

Geoffrey Shindler OBE, Consultant at DWF LLP, was the final speaker of the conference and presented an analysis of recent trust case law.

The conference in Cyprus was a success on all levels: organisation, attendance and, most importantly, the participation of such distinguished speakers.

A resounding success

The first STEP international conference to be held in Cyprus surpassed all expectations.

It filled the room to capacity with leading professionals from Cyprus and all over the world, and was addressed by an impressive array of speakers who informed us, enlightened us, educated us and entertained us.

And this is what STEP conferences are about: to make us stand up and take notice. To show and tell. To tell and get told! To teach and get taught. To learn and to further develop.

The conference was about people. It helped us extend and create friendships. We networked, we socialised, we raised a glass to STEP and celebrated professional and personal relations.

Note: Peter G Economides TEP was Branch Chair of STEP Cyprus at the time of the conference


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