On Dec. 5, 2017 – just three weeks hence – our sovereign, the United Kingdom, will vote on whether to accede to the calumny of the European Union and blacklist in financial markets several of its own territories, most notably the Cayman Islands, Bermuda, the Channel Islands and the British Virgin Islands.
Such a vote, one would think, would be unthinkable, but, indeed, it is possible, if not plausible. Such a vote would do considerable, but certainly not irreparable, harm to the financial services sector of our islands. In effect, our Mother Country would be attacking her own progeny.
For those who have not been following this issue closely, some background will be helpful. (Also, please read the Letter to the Editor on this page from attorney Anthony Travers.)
The European Union, which is comprised of 28 nations (including the U.K., which is negotiating its exit through a process called “Brexit”), has compiled a list of 53 countries and territories that for want of a better phrase, it considers to be “tax havens,” operating out of compliance with the European Union’s somewhat fanciful, left-leaning view of tax equalization and redistribution.
On Dec. 5, all 28 European Union nations will convene, represented by their finance ministers (through its arm Ecofin), to vote on which countries will be “blacklisted.” The U.K., of course, still remains in the European Union and, thus, will have a vote until the Brexit process is completed in two years or so.
Now the most important fact: In order for a country to be added to the “blacklist,” the vote must be unanimous – 28 to 0.
In other words, the U.K. has it in its power to “veto” the European Union’s overreach and its usurpation of other jurisdictions’ nationalism, sovereignty and, we would argue, inalienable right to establish their own tax and revenue policies and manage their own internal affairs.
If anyone thinks for a moment that the European Union is acting fiscally, rather than politically, let us dissuade you of that delusion. Consider:
The European Union has exempted all of its 28 member states from inclusion in the blacklist – including such financial “offshore” behemoths as the U.K. (with its City of London), Luxembourg and Ireland.
Also, conspicuously absent from the list are China and the United States, which for the enlightenment of the geographically or economically challenged, includes the State of Delaware, which is the registered home of more than 1 million businesses, including more than half of all U.S. publicly traded companies and 64 percent of all Fortune 500 companies.
Want to take a guess at which country internationally incorporates the most companies in Delaware?
We will help you: The U.K. But also represented are China, Taiwan, Cyprus, Gibraltar, Hong Kong, Germany and France.
Want to know why China and the United States are not candidates for the European Union blacklist?
We will help you again: The EU does not have the guts.
Premier Alden McLaughlin, much to his credit and the benefit of these islands, has taken a principled and vocal position on the pending EU blacklist.
On the House floor last week, Mr. McLaughlin said, “We cannot make unreasonable concessions which will have the effect of making the Cayman Islands irrelevant to the very business that is the basis of our existence as a financial services jurisdiction. So, if the choice is the blacklist or maintaining the basis of the business that we have now, we’ll choose the blacklist.”
The U.K. – our steward and protector – has a duty to be our champion in this battle. If Cayman does appear on the EU blacklist, and the U.K. does not vote in our best interests, our economy will be dented. But our faith in Mother England will be crushed.
On Dec. 8, 1941, President Franklin D. Roosevelt addressed the United States Congress, seeking a declaration of war against the Empire of Japan one day after its surprise attack on the U.S. naval base at Pearl Harbor in Hawaii. President Roosevelt declared Dec. 7, “a date which will live in infamy.”
If Britain’s Foreign & Commonwealth Office casts its lot against the best interests of its territories, especially these verdant isles, Caymanians will be entirely justified in memorializing Dec. 5, 2017 as our own “date which will live in infamy.”