Press Release: Published June 2012
Liechtenstein and the United Kingdom sign double taxation agreement
Vaduz/London, June 12, 2012 – Following the signing of the double taxation agreement (DTA) on June 11, Liechtenstein’s Prime Minister Klaus Tschütscher and representatives of HMRC, the UK tax authority, attended an information event in London jointly hosted by Liechtenstein wealth management group Kaiser Partner and Bank Frick. The event centered on the content of the double taxation agreement, its implications for wealthy clients and its effect on the international competitiveness of Liechtenstein’s financial center. More than 70 major financial intermediaries took part in the event.
Competitive and attractive for wealthy international clients
The historic double-taxation agreement between Liechtenstein and the UK confirms Liechtenstein’s will and desire to build on its position as an attractive jurisdiction for a wealthy international clientele. After the official signing ceremony at the Houses of Parliament, the those responsible for the treaty conducted an international information event, hosted by Kaiser Partner Group and Bank Frick, at the Institution of Civil Engineers in the heart of the financial metropolis. Prime Minister Klaus Tschütscher expressed his pleasure at this latest development and explained why the agreement is so important to Liechtenstein’s future. “The Liechtenstein Disclosure Facility creates confidence not only for UK tax payers who already work with a Liechtenstein financial intermediary, but also for new clients who want to build up a relevant relationship Liechtenstein. This legal security and stability with regard to client relationships are the foundations on which confidence in Liechtenstein is built. Liechtenstein’s government attaches great importance to a sustainable, confidence-inspiring locational promotion policy. The country is making good on its promise to international clients and investors that even in times of turbulence in Europe and around the world, it will always be a reliable and trustworthy partner. This is a fundamental principle not just for our clients, but also for our state. We want to be a tax-compliant country and we are pursuing this strategy very rigorously. We and the United Kingdom have now brought into being a successful regime for unpaid taxes. An agreement that works very well and that can serve as a model for arrangements with other countries.”
Challenge and opportunity - into the future with a clear vision
The double taxation agreement makes the Liechtenstein financial center competitive on the international stage. Fritz Kaiser, Executive Chairman of wealth management group Kaiser Partner, and Mario Frick, Executive Chairman of Bank Frick, made it clear in London that they believe the agreement will help give Liechtenstein an attractive new position. Fritz Kaiser: “We live in a time of rapid and far-reaching change, and the way international asset management business is conducted is changing too. In this environment we see new opportunities for clients and for those intermediaries who understand the drivers of change and know how to use them.” According to Fritz Kaiser, the agreements between the UK and Liechtenstein show how you can put yourself on the right side of the changes that are occurring and in doing so offer wealthy clients attractive new – and completely legal – off-shore solutions in Liechtenstein
Mario Frick explained why Liechtenstein will continue to be an important venue for wealthy clients: “Clients need to know that our wealth management services are of a high quality, especially against the complex backdrop of taxation. Banks in Liechtenstein have a lot of experience in asset management, asset protection, tax structures and banking in general. They are very stable because they don’t do investment banking, which sometimes seems more like gambling than proper banking. I believe that Liechtenstein banks can become important for clients who need institutions that are used to dealing successfully with different legal regimes. Double taxation agreements provide a clear legal framework in which to operate.”
The new double taxation agreement between Liechtenstein and the UK is the result of two years of discussion and negotiation, and it underlines the long-term commitment to cooperation on tax matters and tax compliance. Liechtenstein’s partnership with the United Kingdom has led to clear advantages for Liechtenstein and for clients of the Liechtenstein financial center. It links the country’s business and financial services sectors into the world’s largest network of tax treaties. The agreement creates the necessary clarity and stability in tax affairs and underlines the value of the Liechtenstein financial center for global cross-border business and investment. The formal ratification process for the DTA has begun, and it should come into force on January 1, 2013.