RELOCATING ASSETS TO A TAX FREE HAVEN
Growing Confidence.
The Central Bank paints an encouraging picture for the future. Foreign Reserves, very important to the economy grew by $238.9 million from January to May 2007 compared with $80.7 million the previous year. This was attributed to tourism and strong continued foreign investment in The Bahamas. The International Monetary Fund has predicted a 4% growth in the Bahamian economy during 2008. GDP is expected to show a 6.5% growth brought about by investment projects already underway.
Wealth Management and Commercial Banking.
According to Julian Francis, the former Central Bank Governor and current Chairman of Bahamas Telecommunications Company, The Bahamas position is not bad, compared to where it was five years ago and is certainly holding its own in these areas. Product development over the same period has done very well, helped enormously by the Bahamas Financial Services Board which has sponsored and spearheaded many fine initiatives. Sound legal conditions, political stability and a world class banking system brought about by very strict jurisdictions are just some of the reasons to consider The Bahamas for asset management.
Securities Commission
The Securities Commission of The Bahamas was an agency created by an act of parliament. It’s mission is to effectively oversee and regulate the activities of the investment funds, securities and capital markets, to protect investors, while strengthening public and institutional confidence in the integrity of these markets.
Looking to relocate your assets? Then consider these points.
- The Bahamas is a stable independent democracy.
- It has laws that guarantee banking confidentially.
- It preserves offshore sector integrity through compliance with the best international practices.
- It boasts an environment free of income, CGT and inheritance taxes
Hedge Funds
(Hedge Funds are a private investment partnership in which investors’ assets are pooled for the purpose of investing in a variety of securities and derivatives. Hedge funds tend to dominate in offshore sectors because of minimum regulations globally. They have an aggressive investment strategy).
Over the past ten years a growing number of Hedge Funds have adopted The Bahamas as a home. Historically they are marketed to wealthy individuals and
Increasingly to institutions, such as pension funds. “Offshore Hedge Funds are among the fastest growing investment alternatives to traditional equity and bond portfolios”.
Mutual Funds
Mutual funds were regulated in The Bahamas in 1995 under the Mutual Funds Act.
It divided investment funds into categories. These included exempt funds, which are exempt from licensing and have no more than 15 investors; authorised funds, having a minimum subscription level of $50,000 and listed on a recognised Stock Exchange, and other funds which are required to be licensed.
The difference between mutual funds and hedge funds is the expected performance. The future performance of mutual funds is dependent more than hedge funds on the direction of equity markets. Mutual funds have restricted investment options while hedge funds rely on where and how they invest. Some mutual funds require an investment of less than $1,000
Asset Protection
Foundations and trusts are two of the main vehicles for asset protection and estate planning. Both are able to operate in a tax free environment. Foundations differ from ordinary trusts in that there is often not a specific beneficiary, rather a specific purpose for which the foundation is established to promote. A Trust allows an individual or legal entity to transfer assets, which may be of almost any type, to a third party. The assets are then administered for the benefit of the persons by the beneficiaries in accordance with the provisions of The Trust.
Transparency
The Bahamas enacted a new Investment Funds Act in 2003 designed to put the country on the cutting edge of modern investment administration. The Securities Exchange Control announced in 2004 that the industry, which is mostly unregulated, should prepare itself for new disclosure rules. Despite the additional bureaucracy and paperwork some companies applauded this while others were not as keen. Most agree though that the new regulations will not catch those set on committing fraud.
Who to talk with.
There are many excellent private banks, private trust corporations and qualified advisors based in Nassau. We have had lengthy discussions with:
ALLIANCE INVESTMENT MANAGEMENT
Who will go through all avenues open to you in great detail. Call Alliance’s representative, Tim Hamilton on +44 1202 669966, or email tim@timhamiltonassociates.com for an informal chat and introduction.
