Guernsey

A
- Andorra
- Anguilla
B
C
D
- Delaware USA
G
- Gibraltar
- Guernsey
H
- Hong Kong
I
- Ireland
- Isle of Man
- Israel
- Italy
J
- Jersey
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M
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- Panama
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- Turks and Caicos
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- Vanuatu

Geography, Population, Languages

Guernsey is the second largest Channel Island off the north-west coast of France, the largest being Jersey. The area of Guernsey is 78 sq. km. and it has a population of approximately 65,400. Its principal centre of business activity is St. Peter Port. The environment is mainly rural. Attractive coastlines offer many facilities to visitors. The official language which is used in all aspects of the Island's financial and commercial life is English, although French is still spoken. French remains the official language of Guernsey's Royal Court, but it is used only on ceremonial occasions.

History, Political Structure and Law

The Island of Guernsey, along with the other Channel (Normandy) Islands, originally formed part of the Duchy of Normandy. Their present Constitution dates back to 1066, when William the Conqueror, Duke of Normandy, became King of England. The Channel Islands have remained possessions of the English Crown, though they are a self-governed autonomous territory.

The Channel Islands have a unique constitutional arrangement with the UK. The Islands are possessions of the English Crown. As distinct from colonial and overseas dependencies of the United Kingdom, the locally elected legislative assemblies have the exclusive right to legislate on matters of domestic concern to the Islands, including taxation. The United Kingdom government is responsible only for foreign affairs. The Islands are associate members of the European Community and as such are only subject to European law in so far as they specifically contract in to the European Community. Thus they have elected to become part of the common tariff and agricultural levy system but are not subject to European law in most other areas.

Guernsey Law is mainly based on English Common Law, with many French features.

Economy and Infrastructure

The financial services sector provides Guernsey's main source of income, and tourism has always been a very important aspect of the Island's economy. There are various other less significant sources of income, including agriculture and fishing.

Air services from Guernsey are excellent, with services to London being particularly frequent. There are also flights to many European centres, including Paris and Amsterdam. Guernsey, like Jersey, relies on sea transport for the importation of the majority of goods. The Channel Islands boast an excellent telecommunications system, as they use the UK digital network.

The Channel Islands are in a very favourable situation owing to the proximity of both the UK and the Continent, and although legislation on Free Trade adopted by the European Community applies to the Island, the politics of taxation planning does not affect Guernsey. The currency is the Great Britain Pound (GBP), and there is no exchange control.

Company Incorporation

The principal Corporate Legislation is the Guernsey Companies Law, 1908 and 1990. Under this legislation it is possible to incorporate only private or public companies. Depending on taxation status, all companies are divided into resident and non-resident (exempt) companies.

The type of company used for international trade and investment is the Exempt Company. Companies which are incorporated in Guernsey but which are owned by non-residents of Guernsey and do not do business with Guernsey-resident individuals or corporations, can be granted exempt status in Guernsey. A Guernsey Company has all the powers of a natural person. The language of legislation and Corporate documentation is English. There are no specific statutory provisions governing secrecy in relation to companies, but English Law, which applies to the jurisdiction, imposes a common law duty on professionals to keep the affairs of their clients confidential.

Companies are subject to the following restrictions on trading and business activity: a Guernsey Exempt Company is not allowed to trade within Guernsey or conduct any activity associated with the banking, finance and insurance sectors.

Incorporation procedure involves submission of the Memorandum and Articles of Association to the Financial Services Department. The Registered Office should be informed of directors' and shareholders' personal details, and character references for the beneficial owners should be provided, also a full description of the proposed company's trading and/or investment activities.

A Registered office must be maintained in Guernsey. Off-the-shelf companies are not available due to the requirement to disclose beneficial ownership and trading activities.

Company names are subject to the following requirements:

Names must be approved by making a formal request to the Financial Services Commission.

The name of a Guernsey-registered company can be in any language that uses the Latin alphabet.
A name similar or identical to that of an existing company or registered entity is unacceptable.
Names of well-known multinational companies are unacceptable without prior written consent.
Names that imply illegal activities are not permitted.
Names that imply royal or government patronage, either local or foreign, are not permitted.
The following names and their derivatives: Guernsey, Bank, Building Society, Savings, Loans, Insurance, Assurance, Reinsurance, Chamber of Commerce, Council, Co-operative, Trust, Trustees, Finance, International or their foreign language equivalents require consent or a license.
Names of Companies with limited liability must have the suffix Limited or Ltd., or the French equivalent Societe avec Responsabilite Limitee or SARL.

A minimum of one director is required, and corporate directors are permitted. There is no requirement to have resident directors. A Company Secretary is required who can be a natural person or body corporate, can be of any nationality and need not be resident in Guernsey. The minimum number of shareholders is two. Corporate shareholders are permitted. Details on the beneficial owner of the company must be forwarded to the Guernsey authorities, but secrecy provisions protect this information. A share register must be maintained at the registered office address of the company. Details of shareholders and directors are maintained on the public files at the Companies Registry, but anonymity can be preserved by the use of nominee shareholders or third party directors.

The normal authorised share capital is GBP 10,000 (or the foreign currency equivalent), although the minimum authorised capital may be a nominal GBP 2, normally with two shares of GBP 1, or the foreign currency equivalent. All shares issued must be paid in full in cash.
The following classes of shares are permitted: registered shares, preference shares, redeemable shares, non-redeemable share and shares with or without voting rights. Bearer shares are not permitted.

Annual Taxation and Fees

Guernsey exempt companies pay no taxes in Guernsey, but are subject to a flat rate corporate duty of GBP 600 per annum irrespective of profit.

Guernsey has signed double taxation agreements, which provide for exchange of information with Jersey and the UK.

Financial statements are subject to the following requirements:

The annual return gives details of the current directors and shareholders and any change in the shareholders since the last return. The return must be filed at the public registry in January of each year, and a filing fee of GBP 100 is payable. If a company fails to file its annual return on the due date, it must pay a penalty.

The authorities in Guernsey expect a new company law to be introduced in 2008 under which normal companies will pay no tax, and companies regulated by the Financial Services Commission will pay 10% tax.