Let’s not forget about taxation
When I first looked at the article headlined “Landscape of Bermuda financial sanctions”, I had reservations that it would be frothy, but to the contrary, I am pleasantly surprised.
It is refreshing to note the understanding and, perhaps, a change in mindset in Bermuda denoting just how powerful, legally persuasive and internationally determined the European Union, Britain and the United States are about transparency, compliance and tax regimes.
Noted, Alexis Haynes, of Appleby, never mentioned the word “tax” once in her opinion, but tax is the fundamental reason why these major power brokers have imposed stricter international laws with overarching draconian sanctions.
Yes, because the substantive reasons of money laundering, terrorist financing, the development of weapons of mass destruction, and here I would add human trafficking, are clearly tax evasions, whereas Bermuda has always insisted that our sin is/was tax avoidance.
But I do respectfully disagree with Ms Haynes’s assessment when she states:
“The dynamic nature of the global sanctions landscape is vividly illustrated when one considers Brexit, where the United Kingdom may be required to introduce an entirely new and independent sanctions regime once it has exited the European Union; or the United States, where there is increasing focus on secondary sanctions.”
Ms Haynes, the legislation passed at Westminster had overwhelming bipartisan support at its core that was championed by Dame Margaret Hodge (Labour) and Andrew Mitchell (Conservative). Thus, the EU would have to have compelling reasons for Britain to make amendments to this legislation because they collectively, EU and Britain, were legally joined for 40 years, so it is unlikely that they will tear up or waiver from the “rulebook” on taxation.
So could Britain make changes to get a quick major trade deal with the US?
Westminster is already rallying to abort any type of negotiation and/or final deal that could potentially harm Britain, even though a new prime minister is yet to take office. In other words, Donald Trump and America may have influence with the new prime minister — reported to be a shoo-in for Boris Johnson — but the Conservatives do not have the majority at Westminster to make quick amendments or to water down their sanctions for US interests. Moreover, Westminster will scrutinise any amendments being brought forward.
Invertedly, is Britain prepared to increase its sanctions if the economy continues to slide? I couldn’t begin to assess that scenario.
But I do think it odd that you did not address a major component of the sanctions in the legislation.
In fact, it is quite odd that no one in Bermuda underscores that the legislation not only targets clients but also their advisers — lawyers, accountants, bankers, etc — who devise complex legal structures designed to hide assets via multijurisdictional operations.
And further that civil and criminal sanctions can be applied equally to both clients and/or their advisers, with one final note, clients and/or their advisers can be extradited to Britain to appear before a court to answer the allegations.
VALIRIE MARCIA AKINSTALL
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