Premier agrees new offshore regime will boost population
Premier Alden McLaughlin in LA, 17 Dec 2018
(CNS): The offshore legislation that government steered through the Legislative Assembly on Monday to avoid being placed on the latest European Union blacklist will likely fuel population growth in the Cayman Islands, Premier Alden McLaughlin has told the Legislative Assembly, echoing recent statements by opposition MLA Chris Saunders. As he defended the eleventh hour bills, McLaughlin said that without them Cayman would be blacklisted and that would be a disaster. He said the changes would likely result in an increased population, and if that is the case, it “would be an incredibly good thing”.
While it will come with challenges, he said, if it doesn’t happen and instead there is a flight of business, that would be far worse for Cayman’s future.
McLaughlin warned that while there are uncertainties about the impact the new bills will have, without adapting to the changing international regulatory regimes and new global standards, Cayman will be in much deeper trouble.
The three bills paving the way for a new dawn in offshore company registration — the International Tax Co-operation (Economic Substance) Bill and amendments to the local company control and companies laws, which were all passed late on Monday night — are likely to fuel an increase in the population because tens of thousands of currently exempt companies domiciled in Cayman will, in future, need to do actual work in the islands.
Depending on each individual entity and the circumstances surrounding their business, they will be required to have some form of office and staff, many of whom will inevitably be work permit holders.
But McLaughlin considered that a positive move as he asked his parliamentary colleagues to think about “the converse” — the departure of offshore business. That, he said, would be terrible, cutting into the local economic success and fueling serious unemployment, which he said was more likely to happen if Cayman took the road some have suggested, with taking a chance on blacklisting.
During the late evening debate he was extremely critical of some opposition members for not lauding government’s efforts. He condemned them for expressing concerns about the lack of clarity on what the legislative changes will mean for the offshore industry.
Saunders also suggested in a recent interview with CNS that government is asking the parliament to take a leap of faith and support the laws without anyone really knowing what the result might be.
But McLaughlin made it clear he believed blacklisting would be disastrous for Cayman. With the concept of ‘economic substance’ emerging as a global standard anyway, he was confident that the jurisdiction will, as it has in the past, ride out this change by being better at what it does than its competitor jurisdictions.
He said that legitimate offshore entities should have no fear of continuing to do business in the Cayman Islands under the new regime and in the end, this latest imposition from the onshore world would see Cayman succeed.
He admitted that there were challenges with drafting the bills, which he revealed had been through “countless iterations” and were still being shaped right up to the last minute, on advice from the industry. But despite the difficulties surrounding the entire process, not dealing with this was not an option.
Without the new legislation, “we will be blacklisted by the European Union”, he warned.
He said that Cayman was in the same position as dozens of other countries threatened with blacklisting and if his government didn’t get the legislation right, it could be rejected by the EU, as is the case with Bermuda, which has gone back to the drawing board two weeks before the deadline of 31 December after the EU found the changes that jurisdiction proposed to make were not sufficient.
He described the process as weighing heavily on him and the financial services minister, and justified their extensive travelling this year, which he said was not because they “enjoyed globe-trotting” but to deal with this problem.
The premier said this issue was not just about the technical elements of how we create a legislative regime to pave the way for the economic substance test but the political issues that relate to the continued attacks on places like the Cayman Islands. Engagement, he said, had been as critical to Cayman’s survival, as it has been in the past, and he was convinced that, at the end of the day, as it always has, the country would come out stronger.
“We have confidence that Cayman is not only going to survive but continue to thrive,” he said of the latest adaptation the jurisdiction is making to remain open for business.
There are, however, numerous unanswered questions with the legislation and concerns that there has not been enough consultation. Nevertheless, Financial Services Minister Tara Rivers claimed it had gone through a significant period of consultation with the stakeholders and the offshore sector, with drafts being written and re-written based on the changing landscape.
She also said that it was not until June that the European Union gave a more fulsome idea of what it meant by ‘economic substance’, which was essential information the technocrats here had needed for drafting the laws and explained why the bills were arriving so late.
Rivers spent the bulk of her introduction to the legislation explaining why the laws had taken so long to draft and why government was forced into the eleventh hour before it was able to publish the bills.
Through she outlined the history of the new law and the amendments to the existing bills, she gave little detail in her presentation of the fundamental changes many industry experts believe will happen after their implementation.
Category: Business, Financial Services, Laws, Politics
God you are a selfish bunch. “What’s in it for us” and “what about local traders” and “how can we make sure all the benefits go only to Caymanians”.
What about “what can we do to help ensure the country’s economy survives this attack on it”?
Time to call Elon Musk and his Boring company, to create a high speed tunnel system, as he is doing in LA?
Except the Hyperloop has a 0% chance of functioning as designed at the moment
Cayman will be the only white country in the Caribbean .
How well are all the black countries doing in the Caribbean right now? Lmao… You racist f….
Racist my foot, white folk turn up here and then decide they want a piece of this pie. They come from all over the hell holes where they live and expect to be treated like gold in Cayman. Most don’t understand caribean culture and don’t wish to integrate. They look down on native folk.
As for Caribbean countries Barbados and Trinidad have always done good while they don’t have the backing of the UK. Plus in those countries it is impossible to get a work permit issued. They make sure and seek local employment. Try getting PR in those countries.
…and their is your rational for not promoting whitey at the work place and price gouging any services offered. Whitey can handle it cause he is rich and he deserves it cause whiteys great great great grand was a slave-owner…this type of hideous racism gets glossed over because it is considered reparations…
I think people are starting to open their eyes that the only thing you are suffering from is a historical persecution-complex.
Ok then, start painting
And the only outnumbered by expats country.
It worries me that one day, we may have foreign protestors in our own country complaining about entitlements, gay marches, increase crime, needs assessment, lay-off Caymanians by the huge population increase from expats. Watch and see.
What is bad is that here you have local radio stations and you swear you are in a white dominanted countries as the DJs have north and European accents.
Why are black/brown-dominated countries invading white-dominated countries? In Cayman it “seems” the opposite but all the wealth here in Cayman still came from white-dominated countries. You are typical in that you like to take the credit for the prosperity of the Cayman Islands when you were just a passive observer who got lucky from the scraps of the wealthy, and not an industrial minded entrepreneur that created wealth.
Another example is why are all the great movies and themes that involved a white person eventually cast with a black person. Instead of sucking off others culture, why not create some new culture for yourself that is not based upon what grandma did 100 years ago or the tired theme of the “ghetto” gangster.
I love how the white blonde blue-eyed “aqua-man” from the 60’s has now a chineese/polynesian father. What about the “multi-verse” spiderman -it all seems so forced and not natural. We all know it is a marketing stunt to cast the widest net to get the biggest buck, but at some point you will need to stop the mimicking and create your own modern culture not based upon other culture’s creative minds.
Creativity and positive stories can create positive culture. If all black writers focus upon is how much they were scammed in the present or historically, then you have a poor pool of writers who are not contributing to your culture of new ideas and you will be forever be a parasite, one step behind, always complaining…that will be your future culture.
you missed the bit of the Bill that mentioned “qualified”
Get back on the plane with that kind of talk. Go on, get.
which can have many meanings so what’s your idea of “qualified”?
We got a billionaire building tunnels to help traffic congested cities and our traffic problem is no different and here we have these buffoons trying to increase our population to make it worst.
NOOO please
there are not enough jobs as it is!!!!!!!!!!!!!
how many are here on work permits without work
lodge doors are open…
not to everybody!
and all say amen!….?
Re: “He said the changes would likely result in an increased population, and if that is the case, it “would be an incredibly good thing”.
I challenge anyone to suggest and apply the above sentiment to any large, western nation today – take your pick; USA, UK, Italy, Germany, Denmark…you name it.
That nation’s leader would crash and burn in the hail of democratic missiles after such a remark.
Nevertheless, good ol’ successive Cayman leadership. Always right here – as contrary and ignorant as ever.
Awesome.
– Whodatis
The voters must take responsibility for the level of political leadership. The basis of reelecting the same people who seem unable to deal with the country’s problems needs to be examined and understood. The question has yet to be asked and debated, “What is the ideal population for the Cayman Islands?”
2021 can’t come fast enough! I know one thing, most of what’s left of Alden’s PPM “Red Bling” will disappear just like UDP, CDP and C4. Newer batches of smart, career hungry young people is going to flip the game changes starting 2021. We’ve seen what happened in 2017 with the 1-Man/1-Vote and the new generation of take no BS attatudes that’s going to either take us back to slop pale days to find our true heritage and passion like Iron Men Caymanians once was. We’ll fall, but we’ll regenerate to the glory along of seeing who we are to continue to grow but to simply put to those that come to our shores, to heal and don’t mess with us …..we’ll love you now, but we’ll chart our lives together again as we grow some brass. And brass is now growing in the Cayman Islands ??
Drain the swamp. The rampant infectious “group think” that our system runs on is causing the asphyxiation of Cayman as we knew it. Since it’s obvious that “our Government” lacks the testicular fortitude to take the road less travelled – then Drain the swamp!!
Hutch…one world describes your post…rubbish!!
“….Financial Services Minister Tara Rivers claimed it had gone through a significant period of consultation with the stakeholders and the offshore sector….”. Now we know why so many $1million plus condo developments are being built – to house the influx of expats. Who said the Government isn’t forward thinking, especially when most of them have their fingers in the property pie! The traffic situation will be even more intolerable once those condos are full. Welcome to paradise!
Say good bye to Bobo!
https://www.youtube.com/watch?v=z6pfSxSsXc0
The Premier speaking at 1:15:25 time: “…Mr. Speaker, the economic impact of introducing substance requirements in Cayman cannot be determined at this stage…”
So one of the largest bills in terms of impact on the financial future of this island and no economic impact study? Why the rush? This was passed in one sitting.
Wait, so we will require companies to have an office on the islands to continue the benefits of a tax haven and that will increase the population? How many companies will just get up and leave?
Bingo!! The answer is ALL OF THEM!!
The vast majority of these “companies” are simply shell structures with no real substance in Cayman, paying very low company registration fees. The likelihood that many of these will want to pay for premises, staff, etc and demonstrate that they are doing business in Cayman is extremely low. So, many will simply be wound up, resulting in lower revenue for both the government and service providers. Those that do choose to stay will probably use CEC or something like that (think serviced office type approach). The flip side is the ability of those who remain to do business locally. This poses a threat to Caymanian-owned and operated businesses….
how about that a ‘global britain’ now?
Lol. Queue Eric Bush.
you all voted for Alden and Mckeeva … this is what your vote got you!!
This is an EU requirement if we want to avoid being blacklisted. Our MLAs felt compelled to put the EU requirement into our laws claiming it is an international standard now. I don’t see why we need to vote for MLAs when they simply impose laws of other countries on us.
Well you could have the other idiots in charge, beat your chests, do nothing and simply face the consequences of blacklisting etc! And in the meantime, most of our competitors would be making the necessary adjustments, avoiding the burning sting of a blacklist and taking lots of business from us!
Let me assure you, the consequence of doing nothing and being blacklisted is certainly a hell of lot worse than having to manage any problems created by these legislative changes.
and you’ve determined this all without an impact study?
Hello, Caymanian here. I did not vote for anybody and have every right to critisize and complain about the current elected. As a Caymanian living under a monarch and corrupt government, I don’t believe in democracy or the idea of voting. If there was someone to stop idiots from voting idiots in then maybe democracy would actually be the answer to society.
10 to15 “negativists” continue to tear down any and everything that allows our Islands to grow and invite new immigrants in the same way that all of us “Caymanians” got here in the first place.
What a bunch?
The quality of life is certainly going to deteriorate on Grand Cayman in the next few years.
Or maybe it will get better.
LOL go stand up in front of Jose gas station at 7:30 am or 5pm
SMH. Does the Premier understands more doesn’t mean better? You know what the competitors have our us? Planning, forward thinking and protection of its people and the envorinment. It seems The almighty dollar runs this island. What about the quality of life, senior living care, unemployment, the dump, reasonable insurance coverage/protection, high cost of living and the envorinmental?
I am not convinced the population growth will materialise. If these employees etc can be outsourced they’ll do that. More likely businesses will move their offshore operations to other offshore jurisdictions or close them altogether.
Born Caymanians are already a minority. This move by Alldone marginalizes Caymanians even more.
As a 26 year old educated, employed Caymanian woman, this hurts. I can’t afford rent or a mortgage at present, despite making what should be decent money. No – I don’t drive a lavish car or spend my salary on frivolous things. I tweeted “I feel like Caymanians are being priced right out of this country” and I saw other Caymanian millennials like me share the same frustration. We are complete afterthoughts. Rent for a 1 bed/1bath is averaging 1200 a month, mortgages creeping up to almost 8 percent and Cayman is STILL not seeing that the next generation of Caymanians are struggling.
This creates resentment for the expats that really and truly just come seeking better opportunities so I choose to resent the right people – the government. It is disgusting to see you roll out a red carpet for everyone else when I am not sure if I will be able to sustain myself, much less future children.
All in Beloved Isle Cayman, I cannot thee forget but boy, you sure seem to have forgotten about me.
I can totally relate this is sad that the government is selling out our island and not even looking out for the natives of this land who built your buildings and roads before dart came in we caymanians our children can not even get free medical of lunch at school and they want to bring in more expacts soon all of us caymanians will be living in that new tunnel dart built home less sleeping on the ground a REVOLUTION IS WHAT CAYMAN NEED AND WE CAN STILL MAKE THAT HAPPEN!
Go try buying a place in London, Vancouver, Sydney, New York or anywhere else in the world
Those countries have other cities within them that are more affordable. Ottawa, Houston etc. This is a small island, it is what it is. And even Canada is implementing additional taxes for non Canadians purchases property.
This government has no conception of population management and quality of life. Between the dump and the DEH imagine increasing the population by 40% and does that sound like responsible leadership? Now lets talk NRA and commute times.
Why focus on the negative? Why not focus on the opportunities this will provide for us Caymanians? Improve your skills if needed. No one is TAKING it from us. Improve ourselves, our businesses, etc.
Or is it simply so much easier to moan about everything?
How can you improve your skills when not given a chance or a mentor? How can you grow in your career when you’re told your qualifications are inferior to the UK or that you lack “real world” experience? How can you educate yourself further when the cost is so high?
If it gets tough here you vou can always get a job in the UK, but you will have to work, it’s not like the Civil Service.
The question is: how many of our 90,000 Exempt Co’s are BEPS structures that will be in scope? For those with USA connections, they can pay a one-time no-questions 10% fee under “COMPLI” and redomicile to USA where corp taxes have been lowered to 21%. Whereas in Cayman, the office proposition, on a dollar to dollar basis, starts at a minimum 25% premium, before duties and permits, and compliance and regulatory burden, without the labour pool, or necessarily the quality of life parity. We are going to have some problems competing on this playing field, and we had better start talking about those now, rather than fantasizing we are so amazing a bargain that everybody will be trampling down our door to get here! Let’s get real.
Bingo. While everyone is waiting for hundreds of thousands of new expats to arrive most of Cayman’s non-funds business is going to be leaving
There’s a Jamaican couple sleeping rough on the beach behind the South Sound community center recently. But yes, let’s import more people from overseas! SMH This government hasn’t got a clue!
You think they own an exempt company?
No, I think they own a local landscaping business with her sister (who got a cabinet status grant) fronting for them. That is what is most likely.
Own a business with your sister and sleep rough. Not much of a sister. Ultimately this law may help these folks if more homes are built and more work is needed.
Who’s going to clean the exempt company owners house and cut their grass? Please do think before you type.
How can Alden pretend to have any clue what he’s talking about, when he has admitted the CIG and Register don’t keep stats and have no idea of the coming impacts, or the yet-to-be published OECD guidance? A good spin-doctor should know when to shrug and say, “this is what we’ve gotta do, under our commitment, hopefully it’ll be okay”. That would be a refreshing bit of honesty. The simultaneous push to spend >$3mln peddling face plate Cayman Islands Exempt Co’s in our competitor jurisdiction of Hong Kong, demonstrates that this Cabinet have no idea what the other hand is doing.
Why don’t they make a law that ensures caymanians have to be trained and schooled to take on the new jobs? Boggles my mind how people of red bay voted for this!
Same old, Same old from a Government that cares nothing of its own CAYMANIAN PEOPLE. Instead of assisting those of us CAYMANIANS who need the 4 basic things to live and take care of ourselves. PROPER HOUSING, FOOD, MEDICAL INSURANCE, JOBS. WE have a Government who prides its selef on importing more people, more slum workers who can’t take care of themselves.
TO MAKE US CAYMANIANS EXTINCT.
THANKS SO MUCH Mr. Alden McLaughlin and ALL who make up. THE SO CALLED UNITY GOVERNMENT. WHAT WE CAYMANIANS NEED TO DO IS GET A REFEMERDIUM GOING AND VOTE YOU ALL OUT. AND HAVE A NEW GENERAL ELECTION AND VOTE IN CAYMANIANS WHO WILL ACTUALLY WORK FOR US THE PEOPLE. I WONDER WHAT OUR MOTHER COUNTRY THE UNITED KINDGDOM THINKS OF THIS.
I FOR ONE WOULD VOTE RIGHT AWAY FOR THE UK TO COME IN AND TAKE OVER THE COUNTRY. AT LEAST WE WOULD BE IN A FAR BETTER POSITION.
A UNEMPLOYED CAYMANIAN, WITH NO PROSPECT OF FINDING A JOB IN HIS OWN COUNTRY. DUE TO DISCRIMINATION, STIGMA, HATE. THANK GOODNESS I CAN GET A FULL UK PASSPORT AND AM A BRITISH CITIZEN.
THANKS MR. PREMIER. CAN’T WAIT TILL YOUR NO LONGER RUNNING MY COUNTRY INTO THE GROUND.
CHET OSWALD EBANKS.
Boy Chet I feel it for you. If you have the means you should do what many other Caymanians have done and move to the UK – they are doing more for the people in need there that they are on our own soil. Cayman is only set up for the mainstream that have no challenges. I speak from experience. Many that don’t have the challenges impacting them personally can’t or refuse to understand the struggles.
But you know the world is round and I believe in Karma – what goes around comes around. Stay strong.
10:38 am, well said. He couldn’t care a damn if every Caymanian is let begging. Thought he was the big mouth, who was toughting jobs for us. He always talks rot through one side of his mouth, thinking he is fooling people. The time will come when he will no longer spin his yarn trying his best to keep his own people down and without jobs.
If Alden is paving the way for more work permit holders/ Caymanian status, what are his plans for jobs for the generational Caymanians that need status to prove that they are Caymanian? The worse, useless, good for nothing government that these islands have ever had is this set of warped brainers.
Which country puts its citizen last? Every law is amended or created in favour of the expat, which law has been created for Caymanians. The Caymanian Protection Law was thrown out to pave the way for work permit holders to stay here and suck up all the jobs. They network among themselves ( each nationality) making sure they bring their own. What has this useless government done? Slam the door in the faces of their indigenous people.
I think you should hurry up and go to England where you can get all of those free things. There are plenty Brit’s that want to come here to take your place
*YOU’RE
Where exactly are we going to put all these people Aldan? The infrastructure is bursting at the seams now. Why are you so h@!! bent on increasing the population WITHOUT a proper plan to deal with the numbers?
I can’t wait for the day we see the back of you!!!! You are educated and stupid at the same time.
Alden is following policies of the de facto Premier
Which shadow minister Sir?
They want to increase offshore worker population, cruise ship passengers and stay over tourism and the island can barely handle the people here now. Traffic is regularly insane during the day and with these changes there are additional problems. Are there enough schools for these new people’s children? Are there enough resources to sustain an even bigger population that we already have?
Making the same mistakes our forefathers made which is to build up without any foresight. Next ten years should be interesting.
Mr Premier, back in the 1990’s, Caymanians and Cayman in general were much better off, with half the population we have now
we all had jobs, much less crime, very few (if any)was losing their houses and no traffice jams etc, etc. BUT NOW CRIME , COST OF LIVING/HOUSING,TRAFFIC JAMS ETC, ARE ALL RAGING OUT OF CONTROL, and you want more people one hundred thousand. The business people will make more money because everyone has to eat and use toilet paper, but these Islands and its people will be a very much worse off, can’ t you see that.
With respects
we are already the endangered specie.
Poor old Caymanians will soon be classified as an endangered species. Question is where is the reservation going to be created?
Plans already approved in East End
I’m going back to the Brac! Grand is dead.
said no-one ever. you’ll be back.
No, you stay there. If you are unwilling to adapt to change, unwilling to work to help your fellow Caymanians, willing to declare Grand Cayman dead and donee, good at nothing but bitching, then we don’t want your wut’less self here.
Na ga be any room.
I’m a young Caymanian (20-25) and sh!tting up because how am I going to compete with 20,000 more expats making double my salary to buy property?
It’s funny how you think. Thousands of new jobs are created – and instead of being happy and working on getting educated to be able to pick any of those jobs that you want, you are “sh!tting up”? This is maybe the largest job opportunity that Cayman will ever see – embrace it. Be glad – don’t be afraid.
I already have a decent job and make much more than minimum wage, live frugally.
It’s not about anyone stealing a job. We’re a small island with limited inventory.
Supply and demand.Think.
You get first priority on a job if you’re able to do it. Educate yourself and compete or sit there and moan. Your choice.
Sounds good, but the reality is Caymanians do not get first priority on jobs. We are discriminated against and held back in the private sector, qualified or not.
You won’t be able to do compete. All Caymanians can do now is work as hard as possible to be above the line where the society will be permanently cleaved in two. Our politicians don’t care about this hollowing out of the middle because they aren’t in it.
cayman brac. its like old cayman over there…you will love it. bye-bye.