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Introduction

Since 1998, Gibraltar has been able to take advantage of the single European passport for insurance.

Gibraltar completed a complex legislative and administrative programme that not only put it on an equal footing with other European captive and cross-border insurance jurisdictions but also gives it some distinct advantages. In 2001 in particular, the Gibraltar legislature passed the Protected Cell Company Ordinance, which not only made it at the time the only domicile within the Single European Market to have PCC legislation, but also sent a signal to the market of its seriousness about the insurance arena.

The key element of Gibraltar’s recent success is the entitlement of Gibraltar domiciled insurers, whether captives or third party insurers, to insure directly risks in European Union states, on a services or branch basis - in other words "passporting".

Gibraltar is a dependent territory of the United Kingdom and part of the European Union under Section 227(4) of the Treaty of Rome 1973 and the Act of Accession of the same year, with exemption from the Common Customs Tariff, Value Added Tax and the Common Agricultural Policy. As such Gibraltar is obliged to enact legislation to comply with EC Directives, including all the Life and Non-Life Insurance Directives. This, combined with improvements in the Regulatory regime, enabled Gibraltar to secure its passporting rights in Europe.

The passport allows insurers incorporated and licensed in Gibraltar to insure risks in other EU states by a process of notification by the Gibraltar Commissioner of Insurance to the regulatory body in the host state (where the risk is situated). The Commissioner must be presented with a business plan for the business to be written, as with any licence application, and local insurance law (e.g. policy language, policy taxes) in the host state must be complied with.

Gibraltar's legal and fiscal features relating to insurance result in a combination which has attracted many new captives and other types of offshore insurers, and also led existing companies to re-domicile from other states (Gibraltar effected its own Companies (Re-domiciliation) Regulations in March of 1996):

• Gibraltar insurers are able to underwrite risks in Europe direct
• Gibraltar's tax system is currently undergoing change, but a single low tax rate (in the region of 10%) is expected to come into force during 2007
• Gibraltar has no job quota requirements for insurance companies or managers, meaning cost base is highly competitive
• Legal system is based on English law, with local statutes
• Official currency is the Gibraltar pound, on a par with sterling, and with no exchange controls
• Official language is English, though the local population is bi-lingual, speaking also Spanish
• As a long-standing financial centre, Gibraltar offers a developed professional infrastructure
• Assets representing shareholders funds must be maintained in the EEA, but need not be held in Gibraltar nor need they be managed there.
  
  

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  For further information, please contact:
  
  Chris Johnson ACII
  4 Bishop Rapallo’s Ramp
  Gibraltar
  
  Tel: + 350 75326
  Fax: + 350 75190
  Mobile: + 350 58452000
  E-mail chris.johnson@gibraltar.gi
  

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