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Introduction to Gibraltar The City of Gibraltar is a
self-governing British Dependent Territory situated at the southern tip of the Iberian
peninsula at the entrance of the Mediterranean sea. On a clear day one can see the coast
of Africa just 12 kilometres away across the Straits of Gibraltar. In territorial extent
Gibraltar is small, about 5 km long and 1,2 km wide, with a population of just over
30,000. Situate at Latitude 36' 08" N and Longitude 5' 22" W, Gibraltar has an
exceptionally good climate with over 300 days of sunshine a year.
Constitution
The Head of State of Gibraltar is HM Queen Elizabeth II and
Gibraltarians are British Citizens. The Queen is represented on the Rock by the Governor
who is also Commander in Chief of HM Forces stationed in Gibraltar. The Governor presides
over the Gibraltar Council which is composed of the Gibraltar Ministers and some senior
civil servants.
Under the 1969 Constitution, certain matters are reserved to HM Government in the United
Kingdom. These include Defence, Foreign Affairs, National Security and Financial and
Economic Stability. The Legislature of Gibraltar is the House of Assembly elected by
universal suffrage every four years and is solely competent to legislate in all matters
not reserved to the United Kingdom government. The Chief Minister of Gibraltar and other
ministers are appointed by the Governor on behalf of the Queen from the party commanding a
majority in the House of Assembly.
Gibraltar became part of the European Communities in 1973 when it joined as a UK Dependant
Territory under Article 227 (4) of the Treaty of Rome.
Indeed, it is the only one of the UK dependencies which chose to do so: other territories,
such as the Isle of Man, and the Channel Islands of Jersey, Guernsey and Alderney, chose
to limit themselves to associate status. As a result, European Legislation applies in
Gibraltar as it does in any other Member State and this is of particular benefit to
Gibraltar's developing financial services sector. Gibraltar benefits from three special
concessions:
- It is outside the scope of the European Common
Agricultural Policy because there are no farmers on the Rock. As a result, many food
products are significantly cheaper in Gibraltar than in neighbouring Spain.
- It is outside the area of the Common Customs Tariff
which means that Gibraltar can charge lower import duties than other EC Countries.
- Gibraltar is not obliged to levy VAT on goods and
services and this is an important benefit to the financial services sector.
Currency
The currency of Gibraltar is the Pound Sterling and British
notes and coins circulate in Gibraltar, although, Gibraltar also issues its own notes and
coins.
Exchange Control
There is no exchange control in Gibraltar and non-resident
persons and corporations are not taxed on profits, turnover or sales. There are no
Inheritance duties for non-residents.
Non-residents may own corporations which although legally resident in Gibraltar pay a low
annual tax and are exempt from all other taxation. There are special tax concessions
available for high net worth individuals wishing to become resident in Gibraltar and for
essential workers who will benefit the Gibraltar economy. Persons and corporations in
Gibraltar may operate bank accounts anywhere in the world without any restriction being
imposed by the Gibraltar government. Gibraltar has no tax treaties with any other country,
not even with the United Kingdom.
Banking
Gibraltar banks operate within the United Kingdom clearing
system and money transfers are made as easily as they are in London. Some thirty British
and European banks are licensed to operate in Gibraltar and total deposits have risen from
£205.8 million in 1985 to £3.2 billion.
Legal System
Gibraltar law is based on English law. Although the Courts
apply English common law and equity, much of Gibraltar's commercial legislation has been
enacted to provide a favourable climate for the financial services industry. For example,
Gibraltar law on banking secrecy, and the confidentiality of off-shore company management
is much stricter than that of the United Kingdom. The Supreme Court of Gibraltar follows
the rules of procedure of the English Supreme Court. Appeals lie to the Gibraltar Court of
Appeal and from there on a point of law only to the Privy Council in London. As a
territory within the European Union, European Union legislation has the same effect as in
any member state and references to the European Court on questions of law can be made.
Most Gibraltar lawyers qualify in England.
Languages and Communications
The official language of Gibraltar is English, but Spanish
is widely spoken and understood.
 In May 1990 the Gibraltar government
entered into a joint venture with the United States based Nynex Corporation to modernise
Gibraltar's telephone system. Under the terms of the agreement, Gibraltar Nynex as
recabled the Rock with fibre-optic lines and has installed the latest technology as the
telephone exchange. As a result Gibraltar has excellent telephone, fax and ISDN services
with the rest of the world. Gibraltar also operates a GSM mobile telephone service which
enables the Gibraltar-based businessman to log on to networks in other GSM countries and
receive calls made to his Gibraltar mobile number.
Gibraltar has its own airport with daily British Airways flights to London Heathrow,
London Gatwick and Morocco. These flights provide excellent onward connections to the rest
of the world. It is also possible to take flights from Malaga, Jerez and Seville airports.
International postal and courier services are handled via London.
Gibraltar time is central European Time (GMT + 1 in Winter and GMT + 2 in Summer). Banking
hours are generally 9.30 am to 3.30 pm.
Summary
The costs of establishing and operating a business through
Gibraltar compare favourably with anywhere else in the world. There is a user-friendly
regulatory and legislative climate which is favourable both for off-shore operations and
for the establishment of Gibraltar-based financial services operations.
Registered in Gibraltar
Number 10452
Licensed by the Financial Services Commission to carry out financial services businesses
VIII
Company Manager License FSC00171B |
