19/01/2016 Gibraltar – A Summary on International Cooperation Gibraltar is a fully self-governing and fully self-financing British Overseas Territory to which the Treaties establishing the European Union apply, with only certain exceptions. As a generality, we are within the EU single market for the purposes of the free movement of persons, the freedom to provide services and the free movement of capital. We are not within the Common Customs Union and we do not have to apply a VAT regime. Thus all relevant EU Regulations apply directly to Gibraltar and all relevant EU Directives are transposed by Gibraltar’s Parliament. This includes all EU measures on financial supervision and regulation, direct taxation and the fight against money laundering. Gibraltar has a diverse and prosperous economy. Our corporation tax rate is 10% and we have a progressive income tax system with a maximum rate on personal tax of 25%. Our taxation regime is subject to European Union scrutiny / signoff and it is applied on a nondiscriminatory basis.
Exchange of Information upon Request on Taxation Matters: The following mechanisms for the exchange of information to the OECD standard apply in Gibraltar: • Bilateral Tax Information Exchange Agreements with 27 countries including the USA • Directive 2011/16/EU on administrative cooperation in the field of taxation, which was transposed in Gibraltar’s Income Tax Act 2010 with effect from 1 January 2013 and which is effective between Gibraltar and EU Member States. • The OECD and Council of Europe Convention on Mutual Administrative Assistance in Tax Matters which was extended to Gibraltar with effect from 1 March 2014, providing for tax information exchange between Gibraltar and all countries and territories that have ratified the Convention. Consequently Gibraltar has, pursuant to the various agreements and the Convention, exchange of information agreements to the OECD standard with over 80 countries and territories around the world; a small number of which are pending their ratification. Gibraltar received a glowing review from the OECD on our record on exchange of information and transparency. The 115 page Phase 2 Review report found that we were Compliant (top grade) in 7 out of the 10 essential elements examined and Largely Compliant (second highest grade) in the remaining 3. Our overall rating was Largely Compliant; the same as eg the United Kingdom, Germany and the United States of America.
Within the European Union Single Market th
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Automatic Exchange of Information on Taxation matters: Gibraltar has signed a FATCA Intergovernmental Agreement with the United Kingdom, and with the United States and has signed a formal commitment to the Common Reporting Standard on automatic exchange of information with close to 100 countries committed to exchanging information; the first wave in 2017 (including Gibraltar) and the second wave in 2018. In addition, Gibraltar applied the EU Savings Directive which first came into force in 2005. This Directive was repealed by the European Union with effect from 1st January 2016. Gibraltar has transposed the EU Directive 2014/107/EU on automatic exchange of information with all member states of the EU (the ‘EU Common Reporting Standard’).
Additional Information on the FATCA Agreement with the United States: The first batch of automatic information on tax matters in respect of persons with a United States tax residence was exchanged with the IRS on September 30th 2015. Gibraltar has introduced legally binding regulations that enforce the provisions of the FATCA Intergovernmental Agreement (IGA) and all financial institutions as defined in the IGA are bound to register and deliver tax information (for onward transmission to the United States) via the secure online portal designed by the IRS.
International Cooperation more widely: Gibraltar regulatory, law enforcement and intelligence authorities work hand in glove with their United Kingdom, United States and other international counter parties in the detection and prevention of crime. Gibraltar has draconian all crimes anti money laundering legislation, systems and administrative practices in place deriving from all European Union legislation on this subject and in precisely the same manner as that extant in the United Kingdom. Our legislation, systems and administrative practices have been independently tested by independent reviews from the Financial Action Task Force, the International Monetary Fund and others and we have been found to have a robust arsenal not only just in place but crucially also in practice.
Within the European Union Single Market th
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The Gibraltar Financial Intelligence Unit (which is responsible for, inter alia, the receiving and actioning of suspicious transaction reports) is a member of the international Egmont Group of Financial Intelligence Units and shares information systematically as well as spontaneously with all members of the Group (including the United States) around the world. Tax evasion, along with all other serious crime, is a predicate offence for money laundering and subject to suspicious transaction reporting. The FATF recently revised their 40 anti money laundering principles and has urged countries around the world to ensure that their legislation and administrative practices match the new standards. Gibraltar is no exception and is well advanced on legislative drafting to put these new standards (as well as the future 4th anti money laundering directive) into effect. Gibraltar is also well advanced in the National Risk Assessment on anti money laundering; such assessments being also promoted by the FATF. Gibraltar will be peer reviewed (in the same way as large countries such as the United Kingdom and the United States) on the introduction and effectiveness of the new standards in due course. Gibraltar has asked to be reviewed on its anti money laundering compliance by Moneyval and this has been agreed. Henceforth Gibraltar is participating in all Moneyval meetings. Gibraltar is also committed to the creation of a central register of beneficial ownership and work to bring this into effect is already under way; the launch of a central register is imminent. Bribery/Corruption
Gibraltar as a European Territory applies the same legislative criteria as all other EU Member States in this field and in addition to these, Gibraltar has draconian anti-corruption legislation in place. This includes; 1. 2.
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The provisions relating to Bribery offences contained in Part 24 of the Crimes Act 2011. On 19 September 2013 the OECD confirmed that the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, had been extended to Gibraltar with effect from 12 August 2013. The United Kingdom Bribery Act 2010 applies to all UK citizens (regardless of residence) and thus applies to individuals in Gibraltar even if the offence takes place outside the United Kingdom.
Gibraltar takes its responsibilities with compliance with International Standards most seriously and has made significant strides in the past years to not only match these standards but exceed these both in timescale and content.
Within the European Union Single Market th
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