The UK Crown Dependency, Jersey, is becoming Europe’s equivalent of Connecticut owing to its proximity to London, its benign tax regime and ...

The UK Crown Dependency, Jersey, is becoming Europe’s equivalent of Connecticut owing to its proximity to London, its benign tax regime and relative absence of red tape for the investment fund sector, according to industry commentators. In a article in Hedgeweek Ian Cadby, chief executive of Jersey-based Liberty Ermitage, was quoted as saying “Connecticut should be the model for Jersey. It ticks all the same boxes – its proximity to markets and research, the clean tax structure, and the improvement in quality of life over London or New York." The UK’s tax authorities are also growing increasingly hostile towards “non doms” - those resident in the UK but not domiciled there for tax purposes and this is making Jersey significantly more attractive than London for hedge funds. But hedge fund managers from an Anglo-Saxon or common law background usually want to remain in a legal environment they understand and are familiar with, another area in which Jersey scores against continental European jurisdictions. Jersey Finance, the island's investment promotion agency, recently announced that three hedge fund managers with funds valued at more than $900 million have moved to Jersey in the first half of the year having apparently been attracted by both business considerations the what it terms “quality of life” provided on the Island. A recent survey of specialist fund advisors at some of the UK’s top law firms placed Jersey as the domicile of choice for private equity and property funds, and second in the world to the Cayman Islands for hedge funds, according to the agency.