Government of Jersey

Information about the publication of Ministerial Decisions

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision
providing a record of decisions and actions that will be available for examination by States Members, and Panels and Committees of the States Assembly; the public, organisations, and the media; and as a historical record and point of reference for the conduct of public affairs

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made 5 February 2010 regarding: Mergers of Jersey companies - approval of consultation paper.

Decision Reference: MD-E-2010-0018
Decision Summary Title :	Consultation on mergers of Jersey companies		Date of Decision Summary:	4 February 2010
Decision Summary Author:	Director, Finance Industry Development		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	n/a
Written Report Title :	Consultation on mergers of Jersey companies		Date of Written Report:	4 February 2010
Written Report Author:	Director, Finance Industry Development		Written Report : Public or Exempt?	Public
Subject: The issue of a consultation paper on mergers of Jersey companies.
Decision(s): The Minister approved the issue of the consultation paper.
Reason(s) for Decision: The purpose of the consultation paper is to invite comments on whether the Companies (Jersey) Law 1991 should be amended to permit Jersey companies to merge directly with a wider range of bodies, including foreign companies.
Resource Implications: There are no cost or manpower implications for the States.
Action required: The Economic Development Department to take such steps as are necessary for the consultation paper to be issued forthwith and the Greffier to be requested to present it to the States Assembly.
Signature: Senator A.J.H.Maclean		Position: Minister for Economic Development
Date Signed:		Date of Decision (If different from Date Signed):

Mergers of Jersey companies - approval of consultation paper

MINISTER FOR ECONOMIC DEVELOPMENT

Consultation on mergers of Jersey companies

1. Issue and Recommendation

1.1. In order to ensure that Jersey’s company law remains market leading, it is intended to amend Part 18B of the Companies Law so as to permit the cross-border merger of Jersey companies with a wider range of bodies, including foreign companies. A consultation paper has been prepared so that all interested parties will have an opportunity to contribute their views on the proposed scheme.

1.2. It is recommended that the Minister approve the consultation paper and that the paper should be issued.

1.3. There are no manpower or cost implications for the States.

2. Background

At present, it is only possible to directly merge a Jersey company with another Jersey company. However, the Companies (Amendment No.10) (Jersey) Law 2009 introduced an enabling provision into the Companies (Jersey) Law 1991 (“the Companies Law”) allowing the States to make Regulations to permit the cross-border merger of Jersey companies with companies and other bodies incorporated outside Jersey and also with bodies that are incorporated in Jersey but which are not companies.

In an increasingly globalized world, more and more business is conducted across national borders and there is a growing demand for Jersey companies to be able to merge directly with a wider range of bodies, in particular with foreign companies – something which is already permitted by some of our competitor jurisdictions such as Guernsey.

Although it is possible to merge a Jersey company with a foreign company indirectly by first bringing them into the same jurisdiction (either by continuing the Jersey company into the foreign jurisdiction or by continuing the foreign company into Jersey under Part 18C of the Companies Law) and then merging them (either under Part 18B of the Companies Law or the relevant foreign law), this procedure is more cumbersome than the direct merger process permitted in other jurisdictions and is also unsatisfactory in some circumstances for foreign fiscal purposes.

In order to ensure that Jersey’s company law remains market leading, it is intended to amend Part 18B of the Companies Law so as to permit the cross-border merger of Jersey companies (subject to appropriate safeguards) with any other body corporate, wherever incorporated. This would include foreign companies, foreign incorporated bodies and also bodies that are incorporated in Jersey but are not companies, such as foundations (once corresponding amendments have been made to the foundations legislation).

With regard to tax treatment, where the resulting merged body is to be resident in Jersey and has Jersey resident shareholders, the Comptroller of Taxes has indicated that he would welcome applications from advisors prior to completion of the merger to determine the tax treatment of profits arising in the pre-merged bodies and the treatment of such profits in the hands of the Jersey resident shareholders following the merger. Where the resulting merged body is to be tax resident in another jurisdiction, domestic tax advice would have to be sought.

It is considered that the proposed amendments are necessary in order to strengthen the competitiveness of the Jersey company, one of the key tools used by the finance industry in the Island, which will help to maintain Jersey’s position as one of the most progressive jurisdictions in the world.

3. Recommendation

3.1. It is recommended that the Minister approve the consultation paper and that the paper should be issued.

FINANCE INDUSTRY DEVELOPMENT

4 February 2010