The British Treasury has set up an independent review to examine the operations of offshore financial centres and their effect on the UK economy.

The review will look at the current and future risks posed by the current economic crisis to the financial business of British Crown Dependencies and Overseas Territories including Jersey, Guernsey, the Isle of Man (pictured above), Bermuda, the Cayman Islands, Gibraltar, the Turks and Caicos Islands, the British Virgin Islands and Anguilla.

The main thrust of the review will be to consider: financial supervision and transparency; taxation, in relation to financial stability, sustainability and future competitiveness; financial crisis management and resolution arrangements; and international cooperation.

The independent panel will be headed up by the ex-Managing Director of the Financial Services Authority Michael Foot who is expected to produce an initial report in time for the 2009 Budget, with a final report required later in the year.

The Treasury stressed that the review will deliberately avoid questions of modifying the constitutional relationship between Britain and the dependencies under review, who will retain their independence in matters of fiscal policy and taxation.

I can’t speak for the other dependencies and territories but the general feeling here on the Isle of Man is that we having nothing to hide and we fully expect the report to support our contention that far from damaging the UK or EU economies we actually help attract finance into their economies.

Full details of the review can be found at www.hm-treasury.gov.uk

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