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UPDATE: VI remains blacklisted despite Premier’s assertions

Despite the assurances given by Premier Dr. the Hon. D. Orlando Smith that the VI has now satisfied the requests from France, however, as of today, January 16, 2014, the Territory still remains on France’s off shore jurisdiction blacklist. Photo: VINO
Premier Dr The Hon. D. Orlando Smith declined to answer questions relating to the Virgin Islands being blacklisted by France as an ‘uncooperative jurisdiction’ in August, 2013. Photo: VINO/File
Premier Dr The Hon. D. Orlando Smith declined to answer questions relating to the Virgin Islands being blacklisted by France as an ‘uncooperative jurisdiction’ in August, 2013. Photo: VINO/File
The questions were posed today, December 17, 2013 during the third sitting of the third session of the Second House of Assembly by Third District Representative Hon. Julian Fraser, RA. Photo: VINO/File
The questions were posed today, December 17, 2013 during the third sitting of the third session of the Second House of Assembly by Third District Representative Hon. Julian Fraser, RA. Photo: VINO/File
ROAD TOWN, Tortola, VI – Despite the assurances given by Premier Dr. the Hon. D. Orlando Smith that the VI has now satisfied the requests from France, as of today, January 16, 2014, the Territory still remains on France’s offshore jurisdiction blacklist.

On August 21, 2013, the French government published a new list of “Non-Cooperative States and Territories” (NCSTs) for French tax purposes that included, among others, Jersey, Bermuda and the British Virgin Islands (BVI). The French tax consequences resulting from this inclusion were set to apply from January 1, 2014.

The French announced the removal of Bermuda and Jersey from the list in December 2013.

Meanwhile, Dr. Smith did not give the House of Assembly (HOA) any indication of the Territory’s removal from the list during his Budget Speech on January 13, 2014, but instead related that the blacklist, coupled with other issues, singularly and together have caused the Territory to look very closely at a number of issues.

He said this included not only its regulatory regime, but additionally, the role that the financial services industry plays in ensuring there is compliance with commitments in the campaign against the nefarious use of the VI’s financial services products.

He related that his Government’s establishment of the International Tax Authority in July of 2012 occurred as a result of realising that there were matters to be addressed in the Territory’s tax information exchange procedures.

“Once the International Tax Authority was established, we introduced it and its new procedures to our treaty partners internationally and to the industry in the BVI.”

According to Premier Smith, “This unit has already made significant inroads in the management and fulfilment of the BVI’s international tax obligations.”

Dr Smith told the House that he was expecting a paradigm shift in the manner in which the BVI deals with its international tax obligations as we continue to resource this unit.

The French NCST List An NCST is a jurisdiction that is not an EU Member State and has not concluded with France, or with at least 12 other States as of 1 January 2010, a treaty that includes an administrative assistance provision regarding tax matters. A jurisdiction with which France has signed such a treaty may also become an NCST if the treaty is not ratified, or if the administrative assistance provision is not effectively applied by the other contracting jurisdiction.

The French government publishes the list of NCSTs on an annual basis. Jurisdictions that are included in the NCST list for the first time will be treated as NCSTs from January 1 of the year following the first listing, while jurisdictions that are removed from the NCST list cease to be treated as NCSTs as of January 1 of the year of the delisting.

The French tax rules regarding NCSTs are designed to discourage taxpayers from doing transactions with those jurisdictions, by, inter alia, drastically increasing taxation on payments made directly in an NCST (i.e., to a bank account opened in an NCST or, if the payment is not made through a wire transfer, to a person or entity whose domicile or main office is located in an NCST) and on investments made, directly or indirectly, in an NCST.

See previous story posted December 17, 2013:

 mum on France blacklist question in HOA

- says answer would not be in public's interest

ROAD TOWN, Tortola, VI – Premier Dr The Hon. D. Orlando Smith declined to answer questions relating to the Virgin Islands being blacklisted by France as an ‘uncooperative jurisdiction’ in August, 2013.

The questions were posed today, December 17, 2013 during the third sitting of the third session of the Second House of Assembly by Third District Representative Hon. Julian Fraser, RA.

Premier Smith was asked, among other things, whether he was able to determine the cause of the French action: if “yes”, what was their reason; and if “no”, why not?

In response, Dr Smith stated, “Madame Speaker, my opinion, to answer this question would not be in the public interest according to Standing Order 18(6), so I cannot provide that information.”

Listed on the order paper were additional questions which asked whether Dr Smith was able to remedy the cause: if “yes”, what was the remedy? and if “no”, why is it not fixed? and who was the person or persons responsible for such a costly misstep? None of these were answered.

When the announcement of the blacklist was made on August 30, 2013 Premier Smith expressed shock and told reporters that the Territory is investigating the reason for the blacklisting and is moving speedily towards ensuring that this is corrected so that the VI can get off the blacklist and continue its good relations with France.

Approximately two weeks later, Dr Smith told reporters that the VI “fell short in the quality of information that was sent to the French authorities” and stated that this was one of the reasons the VI may have been blacklisted. He further announced that a new unit within the Finance Ministry, the International Tax Authority, had been established to better facilitate the flow of tax information.

Premier Smith disclosed last month that the VI has now satisfied the requests from France, however, as of today, the Territory still remains on France’s off shore jurisdiction blacklist.

14 Responses to “UPDATE: VI remains blacklisted despite Premier’s assertions”

  • pat (17/12/2013, 15:09) Like (5) Dislike (1) Reply
    Ndp to shame with how they made a mess of the off shore industry
  • qc (17/12/2013, 15:29) Like (3) Dislike (0) Reply
    maybe France is listening
  • voter (17/12/2013, 17:13) Like (2) Dislike (1) Reply
    Well at least he did not throw his financial secretary under the bus
  • apple pie (17/12/2013, 19:15) Like (4) Dislike (0) Reply
    Well we all know the reason why hahahha
    • wise up (18/12/2013, 07:56) Like (1) Dislike (1) Reply
      apple pie; you need to share info because "we" all do not know the reason why !!!! share the hahaha, please....this is the season for sharing??????????
  • ooooo (17/12/2013, 19:37) Like (13) Dislike (2) Reply
    this country was never ever blacklisted under the vip....never!
  • ABC (17/12/2013, 21:15) Like (9) Dislike (0) Reply
    Personally, I am concerned about our Premier's ability to run the financial affairs of this country. His response to the question concerning the Chief Auditor's Report leaves much to be desired. " I have not seen a copy of the report, I have no interest in the report." WOW!! the Minister of Finance has no interest in a report which details corruption to the highest degree in his Administration ? what does this say about his sense of responsibility and good governance. At this point in time I see very little difference between the Doctor and Tilford.
  • S.R. (18/12/2013, 06:00) Like (1) Dislike (0) Reply
    An educated Dr. and he has no interest in finances except Cruise Pier, 5 star resorts (most of which fail), and huge airports not needed since current one receives less than it did years ago. He will only learn when 3rd party with smarts takes over. VIP filled there pockets and were defeated, now NDP wants to fill their pockets & they will be defeated.
  • Penguin (20/12/2013, 06:02) Like (0) Dislike (2) Reply
    That's right keep speaking about the airport and not expanding as all you will be left with is Liat! So keep on keeping on. No one is investing in smaller planes there is simply no money in plying the PR BVI route. Can't u not get that through your thick skull. Which is why u need to attract larger airlines. Which means we can get at last 200 pax plus on at least 1 flight a week from various destinations in 1 flight. Please think of 5-10 years down the line. If you don't develop you fall behind and keep missing out.
  • team (16/01/2014, 09:26) Like (1) Dislike (0) Reply
    NDP WILL KILL THE FINAICIAL SERVICES JUST LIKE THEY DID THE CURISE SHIP SECTOR
  • native (16/01/2014, 11:04) Like (1) Dislike (0) Reply
    It's ironic that in a time when the NDP traveling and globe tripping around the word and giving no reports here we are still on the black list…it means that they are useless…NDP MUST GO
  • -------- (16/01/2014, 12:26) Like (0) Dislike (0) Reply
    Dr. Smith Administration reminds me of Willard Wheatley in the 70s and 80s went the bank took our house and land...and the VIP had to come and save the country history repeating itself again
  • cat (16/01/2014, 16:23) Like (1) Dislike (0) Reply
    shame on the NDP
  • Black is coming!!!!! (16/01/2014, 17:40) Like (0) Dislike (0) Reply

    Seem to me the word should be WHITELISTED and not BLACKlisted its not a black nation that is doing it to the VI, oh I forgot anything BLACK is naturally BAD!!!!!! Watch out its night time the darkness is coming!!!!



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