The Alternative Investment Management Association says the plan to add the Cayman Islands – the major offshore domicile for the global hedge fund industry – to a tax haven blacklist remains an “open matter” until any formal decision is reached.
The Alternative Investment Management Association says the plan to add the Cayman Islands – the major offshore domicile for the global hedge fund industry – to a tax haven blacklist remains an “open matter” until any formal decision is reached.
The Economic and Financial Affairs Council (ECOFIN) – which comprises the 27 EU member states’ finance and economics ministers – will reportedly greenlight a plan to add Cayman to a list of ‘non-cooperative’ tax jurisdictions when it meets on Tuesday.
Cayman is the most popular offshore jurisdiction for hedge funds globally. Last year, the number of funds licensed by the Cayman Island Monetary Authority stood at more than 10,000.
AIMA, the industry body for the hedge fund and alternative investment sector, is now weighing up the impact of the EU’s potentially far-reaching proposal.
The group said on Monday it will provide a fuller briefing to its members when the circumstances surrounding the decision become clearer.
“Until the ministers formally take a decision, the listing is an open matter,” AIMA said in a statement ahead of this week’s meeting.
The EU’s proposal would group Cayman alongside the likes of Oman, Fiji, Belize and Samoa on the nine-strong list of offshore territories considered not to cooperate effectively with the bloc with regards to tax matters.
“Where a jurisdiction is included on the list, the immediate direct consequences to the fund industry or otherwise are limited as the EU has not developed comprehensive sanctions or regulatory interventions, although individual member states may have a range of actions under their domestic laws,” AIMA said.
