Myners tells UK to grab offshore funds
Treasury minister Lord Myners has called on custodians to seize an opportunity to attract to the UK trillions of dollars of funds domiciled in offshore tax havens.
In an interview with Financial News, Myners said UK investor services companies could take advantage of an incipient trend of money moving away from offshore tax havens.
He said: “I see this as a significant opportunity for the asset management industry to pursue. We have very well-established competencies in fund administration, custody and registration, which should be champing at the bit to pursue the opportunity to onshore money which is currently offshore.”
Tax havens have been targeted by the G20 group of leading economies, many of whose members fear offshore centres are used for avoiding tax and regulatory supervision. The centres are being pushed into signing up to information exchange agreements, which will increase the expense of basing a fund there.
Meanwhile, the advantage of domiciling a fund in the EU is growing as the European Commission proposes rules to facilitate the marketing of EU funds to EU investors.
The UK Government this year set up the Foot review into the British offshore financial centres in Crown dependencies. The review includes the Cayman Islands, – which is home to two thirds of the world’s hedge funds.
Myners said: “It’s pretty clear that in relative terms those centres are going to diminish in importance. The boards of directors of the funds will be looking at where they come into the EU, do they come into the UK, to Ireland, to Luxembourg? I would like to make sure the UK is the destination of choice.”
Taxation should not be an issue. The investor is taxed, rather than the fund, so an investor should be indifferent as to the location of the fund.
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