Anti-avoidance is a topic much in the news these days. But it has a long history. The concept of abus de droit, to which Judge Schiemann referred in his talk in Luxembourg, has been a feature of French and other European systems of law for many years. And a general anti-avoidance rule – a “GAAR” – is to be found in the statutes of a number of non-European jurisdictions: Australia, Canada and Hong Kong are the well-known examples. But what is less well-known is that a GAAR was embedded in the “Colonial Office Draft,” which was the basis of the income tax laws introduced in the British overseas territories after the Second World War – see, now, s.40 of the Gibraltar Income Tax Act, or s.90 of the Mauritius Income Tax Act – which members will be able to discuss with Muhammed Uteem in Florence in November.
A glance through the programmes of our recent meetings shows the topic of anti-avoidance threading its way through many related topics – Joe Field’s What the Non-US Service Provider needs to know about FATCA, in Lisbon; James Howes’s exposition of the French crackdown on trusts, in Cannes; Diane Hay’s View from the Inside in Venice; and Timothy Lyons’s discussion of Double Treaty Relief in Malta. This year the GAAR arrived in the United Kingdom. It is by no means universally loved, and is said to be deterring a number of non-UK banks from establishing a base in the City. But all of us need to understand how it works: those not affected by it may see it as a portent of things to come, and those affected by it must learn to live with it – as Michael Flesch QC will explain in Florence in November.