A government spokesperson said the draft legislation had been withdrawn “as it does not meet the new UK QROPS rules”.
“However, we are continuing to look at options for providing an international pensions offering,” the spokesperson said.
As reported, HM Revenue & Customs surprised the QROPS industry last December when it unveiled a number of changes to the way qualifying recognised overseas pension schemes must be set up and run. It stunned many QROP scheme administrators further in April, when it published an updated list of recognised schemes that saw hundreds summarily knocked off, including 310 out of 313 Guernsey schemes.
Jersey’s decision to back away from the QROPS market, at least for now, comes after the Qatar Financial Centre Regulatory Authority earlier this month decided against amending its regulatory framework to allow QROPS to be administered by Qatar Financial Centre-regulated entities. "Our sense was that the HMRC changes introduced last December, which saw hundreds of schemes in certain jurisdictions de-listed three months ago, introduced uncertainty about how the QROPS market in some financial centres may develop over the next couple of years," Shaun Swan, associate director in the policy enforcement division of the QFCRA, told International Adviser at the time.
Not all jurisdictions have been put off by the recent changes: At the end of last month, for example, Gibraltar passed an amenment to its Income Tax Act 2010 making QROPS possible, while Malta has been moving aggressively to accommodate the UK pension transfer business, following on from its designation as an approved QROPS jurisdiction at the end of November, 2009.
Yesterday, Malta’s Inland Revenue published new guidelines for QROPS, which it said were aimed at clarifying the jurisdiction’s position in terms of its tax compliance.
Challenge to Guernsey
Jersey’s plan to enter the so-called third-country QROPS market had been being seen as a challenge to its neighbour and historic rival, Guernsey, which managed to built a significant industry out of the management and administration of UK pension scheme transfers after an overhaul of Britain’s pension regime that took effect in April 2006, which created an efficient mechanism for such transfers.
The appeal of QROPS is that when set up properly, they can offer a number of tax, investment and general flexibility advantages over UK-domiciled pensions, though are intended only for people who intend to leave Britain for good.
