Key Facts

• Approximately 20% of the British motor insurance market is serviced by firms from Gibraltar.
• The Association of British Insurers has reservations about setting conduct rules at an international level due to differing consumer expectations in different countries.
• There are no significant tax advantages for UK-based companies relocating to Gibraltar, except for a small value-added tax advantage.
• British consumers using Gibraltarian firms will have access to the Financial Ombudsman Service.
• Gibraltar-based firms operating in the UK are subject to FCA conduct rules.
• The UK market tends to buy insurance online or through independent financial advisers, unlike Europe where it is typically done in local shops or banks.
• Duncan Hames is the director of policy at Transparency International UK.
• The Financial Services Bill aims to enhance regulatory duties around money laundering and anti-corruption measures.
• There is a suggestion to expand the 'failure to prevent' offence model to areas like tax evasion and other economic crimes.
• The Government took over three years to respond to a call for evidence on failing to prevent economic crime.
• There are 14 supervisory bodies for the accountancy sector alone, indicating fragmentation in AML supervision.
• Fines imposed by HMRC for money laundering offenses are typically less than £2000 and may be lower than transaction fees or commissions.
• The police estimate that the impact of money laundering on the UK economy is approximately £100 billion annually.
• The fifth anti-money laundering directive has been transposed into UK law.
• The economic crime plan aims to bring public and private sector enforcement closer together.
• A consultation on reforming Companies House is ongoing, expected in the Queen’s Speech.
• There are currently 25 anti-money laundering supervisors across various sectors.
• The Sanctions and Anti-Money Laundering Act placed a duty on Ministers concerning Britain’s overseas territories.
• British Virgin Islands made a statement with numerous reservations and conditions attached.
• Companies House is undergoing cultural change due to new directions and anticipated legislation.
• Scottish limited partnerships can have corporate partners registered in jurisdictions where beneficial ownership is not clear.
• Fines imposed by professional bodies and HMRC for financial misconduct are often less than £1,000.
• The UK is recognised as an active enforcer of anti-bribery laws but comes close to losing its top ranking.
• Lisa Osofsky, the director of the Serious Fraud Office, describes the current system as antiquated and hamstrung.
• Rupa Huq introduces Jesse Griffiths from Finance Innovation Lab.
• Fran Boait is the executive director of Positive Money.
• The discussion focuses on how civil society organisations engage with financial regulators.
• The global financial crash cost Britain £7.4 trillion according to Andy Haldane, chief economist at the Bank of England.
• The Financial Services and Markets Act 2000 introduced an outcome-based approach with technical standards.
• A review is underway for 12 weeks to look holistically at the constitutional relationship between the Treasury, Parliament, and regulators.
• The Bill sets new accountability frameworks for regulators in schedules 2 and 3.
• HSBC and Barclays have funnelled about £158 billion into fossil fuels since the signing of the Paris agreement.
• The funding gap for small and medium-sized businesses is £20 billion, according to Andy Haldane's speech.
• The UK's financial sector is at a crossroads with respect to international competitiveness versus domestic needs.
• There are amendments tabled for annual reviews of capital regulation requirements.
• A proportionate regulatory regime for mutual banks would be beneficial but was not included in the Bill.
• The Financial Services Bill lacks mention of environmental priorities.
• Amendments 20 and 24 are supported by Rupa Huq for addressing environmental issues.
• Penalties for large organizations failing to carry out environmental risk assessments are discussed.
• Financial institutions would have to hold higher capital against loans to high-carbon sectors.
• The Financial Policy Committee recognises climate risk as significant for financial stability.
• Similar measures exist in the housing system but do not completely solve systemic issues.
• Rupa Huq thanked Jesse and Fran for their evidence.
• The final panel member is ready to speak.
• When the UK joined the European Union in 1973, Gibraltar also became part of the EU as a result.
• For many years up until 2001, Gibraltar strived to enjoy the benefits of EU membership while adhering to its directives and regulations.
• In insurance services, which is the largest area of interest between UK and Gibraltar, an independent contractor was engaged by both governments to conduct a detailed gap analysis to ensure aligned standards.
• Gibraltar’s financial services legislation has been consolidated into one Financial Services Bill encompassing all areas.
• Section 20(2) of the Financial Services Bill refers to aligning the Gibraltar regulatory regime's standards and supervisory practices with those of the UK.
• About 90% of Gibraltar’s financial services business before Brexit was with the United Kingdom.
• Gibraltar's motor insurance market has grown to represent 20% of the UK market over a 15-year period.
• The corporate tax rate in Gibraltar is 10%, compared to 19% in the UK.
• Regulatory accessibility and expertise are cited as key reasons for firms choosing to set up in Gibraltar.
• The final evidence session of the day was concluded.
• The next meeting is scheduled for Tuesday, 24 November at 09:25 am in Committee Room 14.
• The Gibraltar Minister provided testimony about tax rates and market conditions.