LINKS
IN THIS SECTION
- Introduction
- Physical Sales and
Distribution
- Digital Sales and
Distribution
- Offshore Corporate
Functions
RELATED
SECTIONS
-
Taxation
of Offshore E-commerce
- Regulation
of Offshore E-commerce
-
Offshore
E-commerce Facilities
-
Offshore
Professional and Financial Services
There is nothing
new about offshore to banks, investment funds
and other types of financial institution; most
of them long ago set up offshore branches in
order to service multinational corporations,
to facilitate trade, and to provide investment
management for high-net-worth individual customers.
Some offshore
jurisidictions have developed as centres for
particular types of offshore financial service:
thus, there are hundreds of banks in the Caymans,
and several thousand investment funds in Luxembourg.
In recent years,
growing financial awareness has created strong
demand for offshore financial services among
a wider community of customers; this is especially
true of offshore investment funds. Even so,
offshore financial services have tended to remain
the preserve of larger companies or of relatively
wealthy and sophisticated individuals - transaction
costs are high and information not always easy
to come by.
The Internet has
opened the way to a far broader market for the
providers of offshore financial services, by
reducing transaction costs and by making information
about offshore available instantly to anyone
who is interested, although national authorities
have sought to constrain this to an extent,
especially in the case of US investors. It is
therefore highly unusual now not to see a warning
of some kind on the websites of offshore online
service providers to the effect that their material
should not be viewed by residents of X, Y or
Z countries. Whether said residents choose to
heed those warnings, however, is beyond the
control of the provider!
Offshore providers
of financial services theoretically have strong
competitive advantages, for example:
- Profits are
less highly-taxed, or untaxed, allowing cheaper
products
- Offshore jurisdictions
are usually less highly regulated than high-tax
countries, so that an offshore financial institution
has more flexibility in planning, marketing
and delivering products
- Financial
products themselves can take advantage of
a low-tax environment in order to deliver
greater returns to customers
- The cost base
of an offshore location is often more favourable
than that of a high-tax location
The whole
range of retail financial services can be provided
from offshore using the Internet. Services and
products can include:
- Electronic
banking including current and deposit account
maintenance, paying bills, direct debits etc
- Offer and sale
of stocks and shares, investment and mutual
fund units, equity derivatives etc
- Foreign exchange
services
- Offer, sale
and maintenance of savings products including
pension schemes
- Offer and sale
of insurance products
OFFSHORE
E-COMMERCE APPLICATIONS
- Physical
Sales and Distribution - Offshore opportunities
for marketing, sales and distribution to consumers
and businesses.
- Digital Sales and
Distribution - Offshore opportunities for
marketing, sales and delivery to consumers and
businesses.
- Offshore Banking and
Financial Services - Offshore opportunities
for marketing and sales of financial products
and investment management.
- Offshore Corporate
Functions - Opportunities for corporations
to locate core functions offshore.
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