Guernsey considers introduction of LLCs
10 September 2019 Saint Peter Port
Image: Shutterstock
Guernsey is proposing to adopt limited liability companies (LLC) to enhance the island’s competitive position in the US.
The island’s government, the States of Guernsey has launched a consultation exercise, as it considers following many other international financial centre jurisdictions in introducing LLCs.
LLCs are commonly used in the US as structures for trading businesses, holding vehicles and special purpose vehicles.
They offer a flexible hybrid structure for any lawful business purpose or activity, offering a limited liability in a tax-transparent structure.
Guernsey was first adopted limited liability partnerships in 2013. It is expected that LLCs would be treated as partnerships for the purpose of taxation in Guernsey, but could decide at the point of the establishment to be taxed as a company.
The States of Guernsey consultation will close on 18 September.
Dominic Wheatley, chief executive of Guernsey Finance, said: “This move will be positive in developing Guernsey’s flows of funds business from the US, which is increasingly a target market for the Guernsey funds industry.”
He added: “The island’s expertise in private placement helps managers to access investment on both sides of the Atlantic, and this move will provide further opportunity for cross-border structuring.”
Dr Andy Sloan, deputy chief executive, strategy, at the promotional agency, commented: “The development of LLCs is one priority in the development of the new product for Guernsey, which we set out in our policy framework for financial services last year.”
The island’s government, the States of Guernsey has launched a consultation exercise, as it considers following many other international financial centre jurisdictions in introducing LLCs.
LLCs are commonly used in the US as structures for trading businesses, holding vehicles and special purpose vehicles.
They offer a flexible hybrid structure for any lawful business purpose or activity, offering a limited liability in a tax-transparent structure.
Guernsey was first adopted limited liability partnerships in 2013. It is expected that LLCs would be treated as partnerships for the purpose of taxation in Guernsey, but could decide at the point of the establishment to be taxed as a company.
The States of Guernsey consultation will close on 18 September.
Dominic Wheatley, chief executive of Guernsey Finance, said: “This move will be positive in developing Guernsey’s flows of funds business from the US, which is increasingly a target market for the Guernsey funds industry.”
He added: “The island’s expertise in private placement helps managers to access investment on both sides of the Atlantic, and this move will provide further opportunity for cross-border structuring.”
Dr Andy Sloan, deputy chief executive, strategy, at the promotional agency, commented: “The development of LLCs is one priority in the development of the new product for Guernsey, which we set out in our policy framework for financial services last year.”
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