ANGUILLA: An Introduction

As a zero tax jurisdiction, Anguilla provides numerous corporate and personal tax planning opportunities. After gaining legal independence from St. Kitts and Nevis on 19th December 1980, Anguilla has developed its own industries, including a financial services industry, while remaining a British Overseas Territory.

Following Hurricane Irma, the country has enhanced the exclusively high-end tourism sector, along with the financial services, fishing, and boat-building industries.

The beautiful, eel-shaped island, which stretches to only 16 miles long, and has some of the world’s highest ranked beaches, adds to the appeal, recognised by tourists and investors alike.

Anguilla is the most north-eastern of the Caribbean Leeward Islands. It is located east of Puerto Rico and six miles north of the French/Dutch island of Saint Martin/Sint Maarten. The average temperature in Anguilla is 80 °F (27 °C) with the summer months producing the hottest periods. Anguilla encompasses several smaller islands off of its mainland coast, with an abundance of marine life and bird inhabitants.

Anguilla’s capital, The Valley, rests in the centre of the island, adjacent to Clayton J. Lloyd International Airport and 15 minutes from both the main ferry terminal in Blowing Point and the main seaport in Road Bay. The Eastern Caribbean Central Bank is the overarching regulator and monetary authority, assisting in balancing the two currencies in circulation. The Eastern Caribbean dollar (official currency) and the US dollar are both traded, with an exchange rate fixed at XCD2.70 to USD1.

Government  

Anguilla’s relative political stability can be admired by neighbouring islands. The dependence on British administration highlights the aspects of sovereignty which Anguilla has relinquished. To this day, the country is governed by its 1982 Constitution with the 1990 Amendments. The government consists of three branches: executive, legislative and judicial. Anguilla is governed with a top-down approach, stemming from the British Monarch (Queen Elizabeth II), who appoints a Governor. The Governor is the highest authority in Anguilla and appoints the Chief Minister. The Chief Minister is the head of government, who delegates the local affairs to the elected officials in the House of Assembly. Elections for the Assembly (consisting of seven elected members) are held every five years.

The most recent election took place in 2015, when the Anguilla United Front (“AUF”) party won a majority of seats in the House of Assembly, under the administration of Chief Minister Victor Banks. Pam Webster, principal of WEBSTER LP, was the only independent candidate elected and the only member of the Assembly not a member of the AUF party. With elections for 2020 soon approaching, constitutional and electoral reform have been at the forefront of the government agenda. At the time of going to press, the Anguilla government is seeking changes to the Constitution which have been selected by them from the composite recommendations of The Anguilla Constitutional and Electoral Reform Committee’s report of 2017.

Anguilla Legal System 

The legal system in Anguilla is based on English common law in accordance with the Anguilla Constitution. It is administered by the Magistrate’s Court, the High Court and the Court of Appeal of the Eastern Caribbean Supreme Court of Justice. The Attorney General is sworn in at the House of Assembly and is accountable to the Governor.

Anguilla is bound by legal decisions handed down by the High Court and, in the case of appeals, by the Eastern Caribbean Supreme Court. The appeal court of last resort is the Privy Council in London, England. The law firms in Anguilla provide high-quality legal services to clients all over the world.

Financial Services Industry 

Anguilla’s financial services are regulated by the Anguilla Financial Services Commission, with the aim of continuing the growth of this sector and stabilising the EC dollar and the US dollar exchange rate. Anguilla is a dynamic financial services jurisdiction, both in the public and in the private sectors. The varying tax advantages, low minimum capital requirements, and offshore and captive insurance legislation allow for an expansive financial sector looking to develop further each year. Anguilla began to develop a financial services industry following the 1993 Mokoro Report, which concluded that Anguilla's offshore financial services were a natural complement to the tourism industry. The result of this was an extensive legislative reform programme, culminating in the 1994 enactment of legislation designed to encourage the development of a well-regulated offshore financial services industry. There are ambitious plans for the future and Anguilla intends to continue to make its mark in the Caribbean, and to position itself as a major player in the international financial services arena.

The Financial Services Commission commenced operations on 2nd February 2004. The Commission ensures that Anguilla meets international standards and that it stands out among various other jurisdictions. The zero tax policies and positive rapport contribute to the island's attractiveness for potential foreign direct investment in a quality offshore jurisdiction.

The newly created National Commercial Bank of Anguilla (NCBA) is in place to stabilise the domestic banking system and it is predicted that 2019 will herald a new chapter of banking operations across the island. NCBA and Scotiabank will be the two main banks operating in Anguilla in 2019.

Additionally, Anguilla also has an online company registration network, known as ACORN, which enables companies to be established and maintained in Anguilla in a swift and efficient manner. Once all documentation has been submitted a company can be incorporated in less than 24 hours.

Employment  

To hire non-Anguillian nationals, it is necessary to establish that the position cannot be effectively filled by an Anguillian national or a naturalised citizen. If it is established that a non-Anguillian national is the best candidate for the position, they must be granted a work permit by the Government of Anguilla prior to commencing employment. An alternative route is to establish a business in Anguilla which entails different, but rather straightforward requirements. The current legislation in relation to employment is the Fair Labour Standards Act, however a new draft Labour Code is currently in circulation and forecast to be implemented in 2019/2020.

Real Estate 

Land and property in Anguilla are open for purchase by both Anguillian nationals and non-Anguillian nationals, who are referred to as 'aliens'. Property tax is assessed on the annual land value at a flat rate of 0.75%. Aliens purchasing land need to obtain an Aliens Landholding Licence as an individual or as a corporation. It is notable that with a change in the status of non-Anguillian nationals being one of the recommendations of the Constitutional and Electoral Reform Report, there may be a change in licensing agreements and belongership criteria in the foreseeable future.

Citizen by Investment 

In addition Anguilla is also set to benefit from new citizen by investment legislation in 2019/2020.