EU blacklist a ‘major worry’

| 12/05/2020 | 78 Comments
Cayman News Service
European Union Commission building in Brussels

(CNS): With the COVID-19 pandemic decimating the tourism sector in the Cayman Islands for at least the rest of this year and probably well beyond, financial services will be the main driver for any economic recovery as the country emerges from lockdown. But Premier Alden McLaughlin said that Cayman must be removed from the European Union black list, otherwise there will be dire consequences.

“Even amid the COVID-19 pandemic, that is a major source of worry and concern for us,” McLaughlin said during last Thursday’s daily briefing. “I am very worried about that. We absolutely must come off that list in October. If not, I think there will be some dire consequences to follow.”

The premier said work was proceeding apace on this, and a number of bills have been drafted which are designed to address the issues and concerns raised before Cayman was blacklisted by the European Union. He added that there would be a meeting of the Legislative Assembly later this month to pass the laws.

Cayman was added to the EU’s list of non-cooperative jurisdictions regarding tax issues, its blacklist, in February after the financial services ministry missed a key deadline by a matter of days over some major pieces of legislation. At the time the premier said it was “deeply disappointing” and that talks to remove the Cayman Islands from the list had begun.

But a month later Cayman’s borders were closed and the country was in virtual lockdown.

Just after the news of the blacklisting, local consultants KPMG issued a report and said that while the listing is not welcome news, “we do not believe there is any immediate concern of adverse tax consequences for Cayman investment funds”.

The financial services firm said its view, “which is consistent with the general industry view”, was that laws were in place to satisfy the EU before October.

Around five pieces of legislation were published last month, which the ministry hopes will address any remaining EU concerns and boost the sector by providing a legal framework to promote the use of new technology and innovative enterprise, Financials Services Minister Tara Rivers stated.

“At a time where innovation is needed to support the economy, given the effects of the COVID-19 pandemic on the more traditional economic pillars, this type of regulated fintech activity will help our financial services industry attract new clients and, in turn, contribute further to government revenue,” Rivers said in a release.


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Category: Business, Financial Services, Laws, Politics

Comments (78)

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  1. Anonymous says:

    Don’t worry… The EU is going to break up… they’ll be back… No worries

    • Anonymous says:

      Don’t worry the UK is going to break up next year with 2 new members in the EU in 2 years time.

      • Anonymous says:

        Lol. Good let Germany and France subsidise them for a while instead of England!

        • Anonymous says:

          You obviously have no idea the large amount of Brussels / EU subsidies that go to the England agriculture sector every year.

          • Anonymous says:

            UK farming gets about £3 billion a year back from the EU (part of which goes to farmers in Scotland, Wales and NI), out of a UK gross contribution of £13.2 billion to the EU.

            England subsidises Scotland by around £5 billion a year (and NI by around £11 billion a year) in normal times and hugely more at the moment, as the English taxpayer is picking up the tab for furloughed Scottish, Welsh and Northern Irish workers.

          • Anonymous says:

            The UK was a net contributor to the EU to the tune of approx STG 9m. So your point is somewhat undermined as long as appropriate, notice my use of the word ‘appropriate’, support is continued to be offered to all sectors in the UK, not just agriculture.

            The CAP was drawn up to protect the French farmers as its primary purpose. Tractor roadblocks and truckloads of dung on doorsteps otherwise.

      • Anonymous says:

        The 2 new EU members in 2 or 3 years will be Scotland and Northern Ireland. They will vote and move with their pocketbooks. They see the writing on the wall.

  2. Anonymous says:

    Worried we’ll be staying on it more like. Frankly, the time for worrying about a possible blacklisting was last year. It’s reality now. They failed in their duty, even having received final warning of fast approaching deadlines for compliance in October. Now this regime are worried we were put on the list we were warned about? What have they done to tackle political corruption, arrest transshipment gang leaders, address absent white collar criminal prosecution? Nothing.

  3. Jellem says:

    Ask the accounting firms, they have the master plan, they save you. Leave those law firms to it ,,,or,,let themleave.

  4. Grapes of wrath says:

    You are all greedy jokers. Take a look around money laundering is rife on Island. Blacklist and lockdown still in place for foreseeable future..ex greedy git.

  5. Anonymous says:

    And we went bragging of the “BIGGEST BUDGET” ever in the Cayman Islands for 2020 and 2021….

  6. Anonymous says:

    So much FS and legal talent in Cayman and they put Rivers in charge. Unreal.

    • Anonymous says:

      ‘They’ didn’t put Rivers in charge above all the talent on the island. A problem with getting the right people to stand for election & get elected. Stop voting according to who der daddy is & start biting according to their ability to deal with the islands real issues.
      It will be very important at the next elections for young, intelligent people to seek election & then our job to vote them in.

      • Anonymous says:

        The young people are the only hope, politically, for these islands. All the others should be put out to pasture to enjoy their massive pensions.

    • Anonymous says:

      YOU put Rivers in charge.

      The Cayman electorate is so small that the value of one vote is worth paying for.

      That’s what happened with McKeeva and his NBF, and the “favour bank” system where a politician might solve problems for individuals or groups of voters (sometimes in violation of the law or out of diverted public funds) in exchange for securing and their families’ votes. It’s what the homophobic ranting is all about – the churches control a lot of votes, and the pastors control the churches, and the pastors are all ranting homophobes (in public at least, if you know what I mean).

      The system is designed to ensure only the most corrupt and the best horse-traders get elected not the best candidates.

      One answer is for people to vote according to the interests of the country and not personal advantage but I can’t see that happening.

      Personally I think the answer lies in the schools. The Cayman education system is worse than bad. I would rather send my kids to public school in Somalia than in Cayman. All they will learn here is that the kids bringing knives to school are the cool ones, that 5 kids with 5 different dads is a form of financial security, and that the Cayman dream is a low-level desk job in financial services with no real responsibilities, a late model SUV with low monthly payments, and enough left over for KFC twice a week.

      I think the only way to pull the country up by its bootstraps is to demand better education for the next generations. But it won’t be easy – call me a conspiracy theorist, but I think keeping the population uneducated and easily placated is exactly how some people here would like to keep it.

      With the amount spent per child in local schools there is no reason it can’t be one of the best education systems in the world instead of the worst.

  7. Anonymous says:

    Perhaps if they’d not missed the deadline and been blacklisted in the first place it would have been less of a worry. The incomptence is staggering. With massive tax rises inevitable across europe what chance they will want to be seen to be cutting us any slack?

    • Ex-Caymanian says:

      Some of the money managers have already quietly relocated (I am one of them). Cayman is beautiful, wonderful and wonderfully expensive, but not the only jurisdiction that offers benefits. The elected government is woefully inept. Caymanians deserve better. Without tourism Cayman is already seriously wounded and bleeding out. Releasing some of the pension funds is a temporary bandaid. Spending savings cannot replace foreign revenue and sales. It is a very sad situation.

  8. Anonymous says:

    Chances of the EU lifting the blacklist in light of covid’s impact on the economy and EU fiscal take – absolutely zero.

  9. Anonymous says:

    I’d like to see the offshore leadership stand up to these assholes in the EU. Remember when the EU sued Microsoft and Google and Apple for anti-competitive practices? What the EU is doing is far worse. They are deliberately trying to destroy the economies of small countries to prevent what they have labelled, with a straight face, “Harmful Tax Competition” Harmful to who exactly? Competition is only harmful to the monopolies and those who are invested in the over-priced status quo. Competition is beneficial to everyone else. That’s why the EU has been so keen to promote it for everyone except themselves.

    The fact is that the unelected but lavishly paid EU bureaucrats and their absurd anti-business regulations are so hideously expensive that they can’t afford to reduce their massive taxes. So instead they are trying to prevent anyone from competing with them.

    Crucially, they do not have much support from the United States, Asia, or the middle east. It is the EU that is isolated on this issue,they just don’t realise it yet.

    The FATF and the money-laundering crap is just another angle of attack to achieve the same thing. It has nothing whatsoever to do with stopping crime – that is what the police are for. In fact the current AML regime is beneficial to criminals because it ensures they get to keep 99.98% of their ill-gotten gains (google it, that’s an accurate figure) while the honest world is busying dealing with complicated, expensive and time-consuming and ultimately useless rules.

    The offshore world needs to organise, lawyer up, get some PR going and needs to start fighting back while we still can.

  10. Anonymous says:

    Same’s they like to implement rules, and not follow…

  11. Anonymous says:

    Major worry? No it’s not. Major worry is having these tax loving globalists destroying this economy by design.

    • Anonymous says:

      And pretty much every other economy as well. They won’t be happy until they tax everyone to death in order to support their globalist agendas. Ever wonder why radical populist leaders are getting elected. Look no further than EU policies.

      • Anonymous says:

        They are not globalists if they want all the taxes for their own countries, that is isolationist nationism, the opposite of globalists.

        It’s like Fox News bragging they are the most watched news network and then bashing the mainstream media.
        If they are the most popular, then it follows that they are the mainstream media

        • Anonymous says:

          Globalists want global taxes they can control. That’s what the OECD is all about. And the EU blacklists are designed to create conformity to these global taxation ambitions, MASQUERADED as trying to stop money laundering and drug trafficking and terrorism..

          Get real please.

          https://www.globalreporting.org/information/news-and-press-center/Pages/First-global-standard-for-tax-transparency.aspx

        • Rick says:

          Well it follows that if you have these views on Fox News and mainstream media, that your reasoning would be so crappy. The negative issue with Globablism that people complain about has to do with the reach of unelected bureaucrats from other countries reaching into your jurisdiction and telling you what to do, even after you passed your own local laws to decide how you want to deal with your business. Mainstream media is not about the most watched, it is about the establishment. They were mainstream at one time and consider themselves to be so, but actually have less listenership in the USA, Of course they can still fool a bunch of people around the world who simply parrot what they see on these idiot platforms. Got it now?

    • Anonymous says:

      Taxes will be going up everywhere after the pandemic as everyone is now in a massive financial debt hole. USA is leading the way as Trump has managed to triple their national debt in just 3 years.

      Oh for the days of Bill Clinton’s balanced budgets.

  12. Hey says:

    Don’t think we need to worry as British will be put on the list after Brexit. The EU is done.

  13. M McLaughlin says:

    The Cayman Islands government is still sweating bullets over a bunch of unelected bureaucratic scums in Brussels. UK gave the EU the middle finger recently, I say we give them the double barrel.

    • Anonymous says:

      Give them the double barrel and end most of the financial services sector here.

      • Anonymous says:

        Not true. EU business is minuscule in Cayman. They prefer their own offshore jurisdictions that operate just like us but didn’t and never do get blacklisted. Funny how that works.

        • Anonymous says:

          Watch what happens when they impose penalties on investors investing in Cayman structures and discourage banks from providing correspondent banking sevices. The impact is minimal now but the more they sanction us the greater the knock-on effects.

        • Anonymous says:

          8:31, You obviously have no idea how much work here is done out of Dublin and to a lesser extent, Luxembourg.

          • Anonymous says:

            “How much work here is done out of Dublin”. So then the work is done out of Dublin, not Cayman.

            • M McLaughlin says:

              9:23am if you dont work in the industry you wouldn’t understand what they meant, so don’t watse your time.

      • M McLaughlin says:

        Last time I checked the center of financial power in the world was London and most of our Funds business comes from the US, so tell how does a bunch of unelected scum come in the picture? Please explain it to me? Tell who has more to lose not doing business with Cayman?

        • Anonymous says:

          McLaughlin, You need to update yourself. London is no longer perceived by world’s senior executives as the centre of the financial world, that title this year was passed to New York City. This change is a direct result of the UK’s BREXIT exit.

          • Anonymous says:

            I think his general point is that neither London or the US are in the EU, which is true of course.

            The EU has major systemic problems right now and is in danger of economic collapse. God knows how this will impact Cayman, I think fears are overblown.

            The problem is more bad optics rather than actual effect right now. We shall see. The blacklist hardly comes up when talking to the US or Far East.

            Having said all that, our representatives are not fit for purpose, no excuse for the late passing of the numerous laws and amendments. So they are quite capable of making another mess of things at any time.

            • Anonymous says:

              Where oh where, did you get the idea the EU is in danger of economic collapse?

              • Anonymous says:

                I think the current problems over financing Corona-bonds and Target 2 transfers, coupled with the complete disagreement over the new budget, now that the UK is no longer contributing, plus the added costs of coping with the pandemic, the fact that the Commision can’t simply order the ECB to print money, the German Constitutional Court rejecting an ECJ ruling (effectively saying that it is not subordinate to the ECJ) might be food for thought.

                The EU is very far from financially stable and the pressure is mounting on several Southern European countries to dump the Euro. Whereas before the pandemic, there was political will to stay in, the reluctance of various countries (Germany, France in particular) to share PPE with Spain and Italy, has soured attitudes towards the EU.

                Add to that, the fact that the EU is proposing to discipline two other countries (by withdrawing their voting rights and EU grants) for either doing what the German Courts did or for saying that they have the right to determine how their own Court system is run and you will start to see that there are many problems ahead, not just financial ones.

                • Anonymous says:

                  China doing all it can to pull EU in different directions too.

                  • Anonymous says:

                    China is brilliant at breaking up the West alliance.
                    Don’t underestimate them. Just look at their quiet financial moves in the Caribbean through Chinese Government State Corporations.

                    Happening here too, but people are still sleeping here or have a financial interest with them. It will come out eventually.

            • Anonymous says:

              The UK is in danger of imploding as a result of BREXIT. Scotland and Northern Ireland leaving in the future.

          • M McLaughlin says:

            Bs, the city of “London” is still the center of financial power in the world, just like DC is the military power and the Vatican being the religious power.

            Don’t fool yourself about NYC being the center of financial power, when they become the 4th “City State” in the world, we can talk.

            • Anonymous says:

              That’s not what the Financial Times Of London said a few months ago as they outlined all the finance companies leaving London for a Dublin, Frankfurt and Paris.

              As for DC being the military power just look what has happened in the Pacific. The Americans are moving out and the Chinese are moving in. NATO is breaking up and China could not be happier as their 5G technology moves in with their military links.

              The Vatican is no longer a religious power as thousands of RC churches are shutting down in USA, Canada and Western Europe. Better look to Mecca as that is where the growth is coming.

              Need to update yourself BIG MAC. You have been on island too long.

              • M McLaughlin says:

                Lol. What stupid incoherent argument. Smh

                • Anonymous says:

                  Big Mac, you talk big but you cannot deliver the goods just like your hero the “stable genius” in Washington.

                  You still going on about herd immunity? Better not look at Sweden today.

                  • Anonymous says:

                    As of today, more than 3,500 people have died of the virus in Sweden. That is the highest number of deaths per 100,000 people of any country in Europe.

                    Herd immunity certainly did not work in Sweden.
                    So much for that great social experiment.

                • Anonymous says:

                  Facts hurt don’t they Big Mac?

            • Anonymous says:

              Basically NYC already is a city state. You been there recently?

  14. Anonymous says:

    how many pillars of the economy we got left???

  15. Anonymous says:

    CNS – I do not think it is accurate to describe missing the deadline of 31/12/2019 by 38 days as “..missed a key deadline by a matter of days..”

    That’s soft soaping Government incompetence I’m afraid. There was no reason to miss the end of 2019 deadline, none at all.

    • Anonymous says:

      There was no reason at all. None. Tara Rivers should have been call to account for getting Cayman blacklisted. She does not know if she is coming or going. The Empress has no clothes on people.

      • Bruno says:

        Regardless of the screw up that caused the blacklisting, she will remain in place because she’s part of the tribe.

  16. Anonymous says:

    The CFATF will surely find that despite a couple hastily drafted and passed laws post-Blacklisting, in this last year, there have been no changes in government corruption, embargo dodging, transshipment interdiction, their related money laundering, and nearly zero white collar arrests/prosecutions. Worse, there’s continuing criticism of our regulatory agencies and their obstruction of TIEAs and foreign criminal investigations. We also hosted a $4Bln crypto-fraud involving a barred participant.

  17. Anonymous says:

    Please stop this. Blacklist, whitelist, greylist, redlist.
    Lists are over. Life will never go back to normal.
    There are only two lists in the world now.
    People that agree with government and people that don’t.
    We are inches away from a totalitarian rule and I mean inches. I am talking weeks and months max.
    There will be knocks on doors soon.
    This is not a conspiracy theory. This is the truth.

    Very soon, a government representative will be assigned to your house.
    If you think this is a lie, just ask the Roper fellow.
    Why do you think the strategic UK government operatives are here in Cayman?

    They came to see Stingray bloody City.

    • Anonymous says:

      Take your meds.

    • Anonymous says:

      Chill man. Really. Where is all this conspiracy stuff coming from?
      The U.K. doesn’t care about us. We don’t pay tax (that they collect) & we don’t claim unemployment benefits. Why would they care what 30,000 Caymanians & 40,000 expats get up to on this silly Little Rock? They’ve got much bigger problems at their place.

      • Anonymous says:

        The UK with all their BREXIT problems would be happy to see their Caribbean colonies go now. They simply have far bigger problems trying to figure out how to hold the UK together which might be gone next year at this time when Scotland and Northern Ireland say good bye to Mother.

        • Anonymous says:

          One thing that pro-remain commenters completely overlook is that the Loyalist component of the population in Northern Ireland is still the largest, and there is no indication in any of the polls that they will vote for a United Ireland (yet). However, bear in mind that losing Northern Ireland would not be detrimental to the rUK, as it costs a great deal of money to keep NI going (around £9-10 billion/ year). The Republic can’t afford to replace this money, being a small low-tax “offshore” economy, so it would have to go to the EU and ask for the cash (so not only does the EU lose the UK’s billions, it has to stump up an even larger sum to pay for Northern Ireland (a net loss of around £19 billion)).

          Likewise, Scotland had its “once-in-a-lifetime” referendum and there is little likelihood that a second will be granted for many years to come. Many make the mistake of thinking that all those that voted the Scots Nats into power in the last election will also vote for independence. Wee Krankie is desparate to get her referendum now, as she knows full-well that the longer they are in power, the more their incompetence shows.

          Oh, and the bottom fell out of their financial plans when the price of oil dipped below $100/barrel.

          On the other hand, if Scotland were to go for independence, the rUK would save even more money. Between the subsidies for NI, Scotland and the EU, the UK will save around $23 billion pounds a year

      • Queenie Ebanks says:

        The first rational comment on this site. Elected and totalitarian governments have one agenda … to stay in power. Everything they do, overlty or covertly, is meant to keep or change the people at the top. If someone wants to change the world then go get an education, work hard, create your wealth and then use to make a difference. Stop complaining. Stop poisoning your brain and body with drugs and negative thinking. It is sad when I see another person high on weed or commenting about globalists. If you think companies making too much profit, then buy their shares. Or get into crypto. There are so many opportunities out there for those who want to educate themselves. The major news channels are all selling you agendas. CNN and MSNBC are as bad as Russia Today and Al Jazeera. Fox News is not far behind.

        Cayman and Montserrat are outposts of minimal concern to the UK. Why should the UK care about the quality of life here? How much to we add to the wealth of the UK? Montserrat is subsidized so it is an anchor. Cayman will soon become one too without tourism and if the financial sector leaves.

        The future of our dear island economy, communities and way of life are in peril. No one is coming to save us. We need better leadership and well paying jobs.

        My children are planning to go the higher education in the USA or Canada with no plans to return because their earning capacity is many times higher than here. Even when factoring in taxation, life is better off the island.

        Other than nice weather and tax benefits for wealthy foreigners, Cayman does not offer much more than other independent Caribbean island nations. We need better qualified leaders who have a plan that can be executed.

        This situation makes me and my husband sad.

    • Anonymous says:

      thanks man, I needed a chuckle. It’s great to be reminded that no matter how bad things get, there are always people like you to remind us how normal we actually are.

    • Anonymous says:

      Call me when the shuttle lands.

    • Pablo Escobar says:

      That is one of the most asinine comments I’ve seen in a long time. You are either a troll trying to rev people up or one of the dumbest SOBs on the planet.

    • Rico Tubbs says:

      What are you on? Can you get me some?

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