Offshore Company Mag

The Isle of Man Financial Supervision Commission has reported continued strong growth in the jurisdiction's financial services sector in the past year, in spite of a "challenging" climate.

In its annual report for 2005/6, the FSC revealed that deposits on the island grew by 19%, while funds under management and administration grew by 76%.

For the last two years the number of new incorporations of Isle of Man companies has also continued to increase. Currently the number is over 40% up on the comparable period last year. According to the FSC, this statistic "provides a very positive background" against which the new Manx corporate vehicle will be launched.

Together with the recent introduction of the 'zero/ten' tax regime, the FSC stated that it can plan its future growth strategy from a "confident and competitive position". The Annual Report notes, however, that over the last twelve months the climate remained challenging, and there was a continuing focus on reducing costs.

The report went on to note that the offshore sector as a whole continued to be highly competitive, with quality business increasingly focusing on well-regulated jurisdictions.

During the year, the Commission commenced a major project to consolidate and modernise the Isle of Man's financial services legislation, and has put forward important proposals to enhance its accountability and transparency as part of this project. The Commission also set out a mechanism under which there would be involvement of the industry in the setting of regulatory strategy.

This project will also embrace innovative proposals for the regulation of e-money, to be drawn up in conjunction with the e-business sector which continues to have strong growth potential.

The Isle of Man's invitation to become a full signatory to the IOSCO Multilateral Memorandum of Understanding will also ensure that Manx-based businesses enjoy access into major markets overseas, the report stated.

Other developments during the year included the enactment of legislation for the licensing and supervision of trust service providers. The Commission took steps further to strengthen its own arrangements for good corporate governance.