This chapter considers trusts law from a perspective which is rarely discussed in English and Welsh law schools: that of the international use of trusts. There is a very important dimension to trusts law practice: the use of trusts in jurisdictions known as ‘tax havens’ or ‘offshore jurisdictions’ to invest or shelter assets in a taxefficient way. Typically these offshore jurisdictions have low or effectively no taxes for foreign investors. Commonly they have specific statutory schemes in place for such overseas investors so that their trusts are treated differently from ordinary trusts: we shall consider the scheme used in the Cayman Islands by way of example. The users of these trusts structures are the international financial services providers (whether investment banks, international accountancy firms or others) who sell their tax-efficient vehicles and structures to clients from the UK, the USA and similar jurisdictions in the industrialised world. Importantly, not only do these offshore jurisdictions offer low taxes, but they also have historically refused to provide information to the tax authorities of other jurisdictions about the investments which have been made in their territories. Consequently, in the past, investors could acquire low tax, clandestine investment services.
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