A well established centre for wealth management business, Jersey has for some time proven to be an attractive location for those looking for a low-tax jurisdiction in which to base family offices and manage financial planning. The Island’s focus has been on catering for the specific needs of high net worth individuals and a great deal of this private client work can be classified as ‘family office’ work.
Regulatory and legislative frameworks are vital in developing an attractive and appropriate family office environment. The ability to establish Private Trust Companies in Jersey, for example, can be appealing as part of a family wealth management structure, whilst the investment fund landscape, especially the Expert Fund regime, is considered particularly useful for private investment purposes.
Jersey continues to explore innovative wealth management solutions in order to support the evolving work of family offices. For example, the recent addition of foundations in Jersey has given the Island’s wealth management industry a real boost. Sitting alongside existing vehicles such as companies, trusts and limited partnerships, foundations may well be called upon by family offices for wealth management strategies. More sophisticated than similar foundation structures in other locations, the Jersey version has attracted considerable interest within the first weeks of its existence, particularly from wealthy individuals in civil law jurisdictions, where the concept of the trust is unfamiliar.
A significant issue for HNW individuals looking to establish a base for their family office is the reputation and stability of the jurisdiction. Recently the UK Treasury named Jersey as a finance centre to be applauded for its commitment to transparency. It also called for other jurisdictions to follow its example, enhancing Jersey’s reputation as a centre for family office work.
The recent G20 and OECD announcements have enhanced Jersey’s competitive position against other jurisdictions. The Island’s inclusion on the ‘white list’ has given increasingly risk-averse individuals far greater confidence in Jersey as a place from which to manage their wealth.
The signing of bilateral tax information exchange agreements (TIEAs) with many leading nations signals Jersey’s commitment to information exchange and helps to demonstrate that the Island is not a bank secrecy jurisdiction. At the same time Jersey does provide a commitment to confidentiality where the financial affairs of perfectly legitimate individuals are concerned.
Within wealth management there has been a move away from the mass produced provider of services. Instead there is a growing preference for independent organisations that can more readily offer a bespoke, tailored service. Amongst the HNW individuals using Jersey as their family office base, the feeling is that a smaller, independent, bespoke organisation can more easily understand their personal objectives, manage their risk and take care of their personal affairs.
Clients are actually looking to get increasingly involved in their own family office business themselves –emphasising the desire they have for control and a much more bespoke approach. Jersey’s range of wealth management service providers are well geared up to offer such a tailored approach.
High net worth individuals seeking to relocate or establish a family office are looking increasingly at jurisdictions with reputations for complying with international standards. In addition an infrastructure that can fully support their needs and a sensitivity that can provide them with a tailored approach to managing their wealth is sought after. These areas are vitally important and Jersey is well placed to meet them.
Home to many investment, trust and custody professionals who have extensive experience in managing all aspects of family office activities, Jersey is well placed to service the growing family office market, either through professional service providers or bespoke set-ups. Its reputation as a well-regulated international finance centre and its commitment to providing a range of private client services, including trusts, limited partnerships and foundations, have positioned Jersey at the forefront of the wealth management arena.
