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article imageBusiness as usual in Jersey despite leaks storm

By Antoine POLLEZ (AFP)     Nov 8, 2017 in Business

With its seaside air and small-town charm, Jersey seems unperturbed by the storm over the Paradise Papers financial leaks in which it is named as the centrepiece of Apple's tax avoidance strategy.

Located just off the French coast, this British crown dependency has taken pride of place in the release of thousands of documents showing how corporations and the world's super-rich minimise tax payments.

The island's capital, Saint-Helier, has a placid feel with its fish market and small shops but a look at some of the office name plates reveals some of the biggest names in world finance have outposts here.

There are also law firms here specialising in offshore finance, such as Appleby, from which the leaks published by the International Consortium of Investigative Journalists (ICIJ) occurred.

Appleby have a building with large windows on a street just a stone's throw away from the coast.

According to the leaks, Appleby advised Apple to set up in Jersey, where the standard rate of corporation tax is zero, after the US giant profited for years from an advantageous tax systems in Ireland.

- 'Not doing anything wrong' -

The concept of tax efficiency is widely accepted in Jersey but some residents fear the latest revelations could damage their island's reputation.

"The worry I have is purely the perception and that is how people, millions of miles away, don't understand what Jersey is all about," Hugh Raymond, head of Jersey Honorary Police Association, told AFP.

"We are a crown dependency, we are a jurisdiction under the crown and it looks as if we had done something wrong but I can assure you we are not doing anything wrong and neither are the businesses," said Raymond, a former financial sector worker who moved to Jersey from mainland Britain in 1996.

"We have an industry here which is finance based. We are going to be in competition, therefore we are bound to upset some people," he said.

The ICIJ pointed out that the leaks did not reveal any illegal activity but were intended to draw attention to strategies used to avoid paying taxes.

In Jersey, many residents declined to comment.

Apple, which has said it follows the law in each country it operates, is also keeping a low profile.

Except for a shop selling its products, the company name does not appear on a register of Jersey firms.

"You won't find them," a financial sector employee said, speaking on condition of anonymity.

"If they came to Jersey, it is not to be found easily by journalists," she said.

- 'Challenge can be met' -

Finance makes up around 58 percent of Jersey's economy and half the jobs on the island depend on it, according to the sectoral body Jersey Finance.

The island is watching closely as the European Union said it is pressing ahead with plans to draw up a blacklist of tax havens.

In its annual report last year, Jersey Finance said after demands for greater transparency that the island was "confident that the challenge can be met".

"We believe that the island meets every requirement with one possible exception: not facilitating offshore structures or arrangements aimed at attracting profits which do not reflect real economic activity."

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