Wealth structuring news digest 9 January 2012

CROSS-BORDER SUCCESSION – EU ministers’ ‘final compromise’ excludes Britain and Ireland 


On 14 December the EU Council of Ministers agreed a ‘final’ compromise on the so-called Brussels IV regulation, designed to set up legal procedures for cross-border succession and probate procedures and the creation of a European Certificate of Succession. However, continuing disagreements on gift clawback kept the UK and Ireland out of the deal. 




STEP WORLDWIDE – Senior appointments with effect from 1st January 2012 


To support the key aims of the membership, the STEP Worldwide Board is building resilience and future organisational potential with three senior appointments in the STEP Worldwide office in London. 




CROSS-BORDER SUCCESSION – Italian will did not disinherit English heirs 


The England & Wales High Court has ruled on the complex case of Perdoni v Curati, deciding that a will made in Italy did not entirely revoke an earlier English will. 




CROSS-BORDER SUCCESSION – Proposed UK reforms would bring non-doms into family provision claims net 


Law firm Withers notes that the UK Law Commission’s proposed reforms to the Inheritance (Provision for Family and Dependants) Act 1975 would extend its application to testators domiciled outside England and Wales. 




Law Commission  


FRANCE – Bulletin on reportable trust assets rushed out over Christmas 


The French government has published a last-minute rescrit (circular) attempting to clarify the categories of trusts and trust assets that will be caught by the trust taxation legislation it enacted last year. It appears to claim that trustees’ asset-reporting obligations began last July. 


French Government (in French)  


CANADA – Hong Kong businessmen lose Copthorne dispute 


Canada’s Supreme Court has ruled against two Hong Kong businessmen in the long-running Copthorne tax dispute, centring on Canada’s controversial general anti-avoidance rule applied to a paid-up capital preservation transaction. The unanimous judgement on 16 December leaves the Li family business with a US$8.5 million withholding tax liability plus penalties. 


Osler, Hoskin & Harcourt  

Borden Ladner Gervais  


UK TRUSTS – Independent agent exemption does not apply to non-corporate trustees 


HM Revenue & Customs has updated its guidance on trustee residence to make clear that non-corporate trustees resident in countries that have a treaty with the UK cannot claim the independent agent exemption from the permanent establishment rules. The situation for individual trustees resident in non-treaty countries remains unclear. 


PLC (free access)  

GUERNSEY – Island ‘surprised and disappointed’ at British QROPS move 


Guernsey Finance chief executive Peter Niven has criticised the UK Treasury for producing new QROPS legislation ‘out of the blue without any earlier discussion or warning’. He says the anti-abuse legislation is not aimed specifically at Guernsey, but if enacted will affect it as the market leader in QROPS pensions administration. 


Guernsey Finance  

BRITAIN – Liechtenstein amnesty tightened again 


Applicants for the UK’s Liechtenstein Disclosure Facility now have to obtain a Liechtenstein bank certificate to prove their ownership of qualifying assets. However Britain is now giving Liechtenstein banks until 31 March to notify LDF users that they need to meet their UK tax obligations – a three month extension. 



HM Revenue & Customs  

SWITZERLAND – Now Washington targets Bank Wegelin 


One of Switzerland’s longest established private banks, Wegelin, has come under attack from the US tax authorities, who have charged three of its Swiss staff with aiding Americans to evade tax. Wegelin, which has no offices in the USA, claims its staff have not broken Swiss law and says it no longer does business with US persons. 




Dow Jones  


TAX TREATIES – Five new treaties in effect for Switzerland 


Switzerland’s revised double taxation treaties with Uruguay, Japan, Greece, Germany and Canada have now come into force. 


Swiss Federal Department of Finance (re Uruguay)  

FDF (re Japan)  

FDF (re Greece)  

Private Banking International  


USA – Estate planning for non-US persons 


US tax expert Warren Whitaker has made available the latest edition of his international estate planning tome, ‘US Tax Planning for Non-US Persons and Trusts: An Introductory Outline’. Whitaker is chairing the New York State Bar Association’s Annual International Estate Planning conference in New York City on 22-23 March. 


Day Pitney (PDF file)  

NYSBA (Conference)  


USA – Tax planning is a minefield this year 


Any US person trying to do tax planning in the next few months will find it nearly impossible, says the Wall Street Journal, citing an expert at Deloitte Tax in Washington. 


Wall Street Journal  

$95 MILLION SETTLEMENT – Magyar and Deutsche Telekom Settle FCPA Charges 


Hungarian telecoms company Magyar Telekom and its German majority owner Deutsche Telekom have reached a combined $95 million settlement with US authorities over FCPA charges, it was announced on 29 December. The settlement ranks as one of the ten largest FCPA settlements to date and relates to Magyar’s attempts to corruptly influence officials’ decisions in relation to market competition regulation and the proposed acquisition of a Serbian telecoms company. 




CYPRUS – International Collective Investment Scheme (ICIS) 


The purpose of an international collective investment scheme (ICIS) is the joint investment of funds. A private ICIS can have up to 100 investors, also known as unit-holders. It allows numerous investors to jointly invest their assets; have these assets administered, controlled and invested by independent professionals; and pull out the gains from profitable investments with a tax cost-effective method. Michalis Zambarta and Georgia Papa discuss the hot topic of international collective investment schemes in Cyprus. 


STEP Journal  




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