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Towards a Level Playing Field,
second edition.


Report undertaken by Stikeman Elliott on behalf of the ITIO and STEP.

 


FINANCIAL CENTRES WORKING TOWARD ‘LEVEL PLAYING FIELD’

Barbados Advocate.com

22 October 2003


The Society of Trust and Estate Practitioners (STEP), a leading international body, is calling on the Organisation for Economic Co-operation and Development (OECD) to end its tax blacklist and improve market access for all financial centres.

At their just ended two-day meeting in Canada, the OECD and a group of international finance centres agreed to work on achieving a global level playing field and, on this basis, to continue their dialogue on tax information exchange.

Most of the non-OECD centres made it clear they remained committed to dialogue despite the OECD’s admission that a level playing field does not currently exist and that its absence is unfair. Richard Hay, co-chairman of STEP’s International Committee, made the call following the meeting held last week in Ottawa, Canada.

He said they had welcomed the outcome of the meeting. “But we are pleased that OECD and non-OECD finance centres will now work together to secure a level playing field for regulation of financial services,” Hay said.


“The OECD is to be commended for recognising the crucial importance of a level playing field amongst all financial centres. OECD must now consider eliminating tax blacklists and work to secure open access to markets by all finance centres,” he said.

STEP is concerned that tax blacklists by OECD member states, which discriminate against non-OECD finance centres, are becoming increasingly common, although “offshore” centres within the OECD escape such discrimination.

“For example, a new law introduced by the Portuguese government discriminates against traditional offshore companies but explicitly gives exemptions to those in booming OECD ‘offshore’ centres like Delaware,” he said.

At Ottawa, OECD participants agreed that a sub-group would work over coming months on developing proposals for achieving a global level playing field. The Commonwealth Secretariat has been given a key role and will host the first meeting of the new level playing field working group.

The Global Forum is due to meet again in April 2004. The importance of the level playing field is highlighted in the second edition of a major report issued today by the International Trade and Investment Organisation (ITIO) and Society of Trust and Estate Practitioners (STEP).

The OECD Global Tax Forum, a meeting of the OECD and other finance centres took place on October 14 and 15 in Ottawa, Canada.

According to the closing statement by the co-chairs, “virtually all participants... agreed that the level playing field is fundamentally about fairness”.

It also said that participants recognised that a global level playing field does not yet exist and that further progress could and should be made to achieve it. In particular, they agreed that ways should be explored to involve significant financial centres that are not currently participating in the Global Forum process.

The international finance centres invited to the Global Tax Forum are those who have committed to the OECD’s principles of transparency and exchange of information (on a level playing field basis).

The level playing field principles are: universal participation in setting new rules; same implementation timetable; and same sanctions for non-co-operation. The Society of Trust and Estate Practitioners (STEP) is the professional body for the trust and estate profession worldwide. STEP members come from the legal, accountancy, corporate trust, banking, insurance and related professions, and are involved at all levels in planning, creating, managing and accounting for trusts and estates, executorship, administration and related taxes.


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IT’S OFFICIAL: OECD TAX PROJECT DEPENDS ON LEVEL PLAYING FIELD

In a groundbreaking decision, the OECD has committed itself to working with members of the ITIO and other countries that provide international financial services to achieve a level playing field for the exchange of tax information.





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