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Isle of Man weight

The Isle of Man – A Place To Make Things Happen

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As a tax neutral domicile the Isle of Man is perfectly situated geographically, fiscally, politically and constitutionally to form part of a structure that wishes to access Europe or indeed any other part of the world.

The Isle of Man is what is termed a Crown Dependency and thus has the Queen of England as its titular head. The basis of law is common law and statute-based and therefore English case law is usually persuasive. With the ever-increasing international influence on domestic legislation, aspects of EU law can be applicable in relevant areas also.

The Isle of Man service providers – lawyers, accountants, trust and corporate service providers (TSPs), Fund Administrators and investment fraternity – pride themselves on having a proactive approach to business wrapped around a pragmatic, value-for-money and professional approach. This ethos is heavily endorsed by both Government through its marketing body, the Department of Economic Development, and the Regulator (Isle of Man Financial Services Authority) and is encapsulated in the Isle of Man marketing approach strap line of “Isle of Man. Where you can”.

Import and Export
The Isle of Man, by virtue of its unique Customs and Excise Agreement with the United Kingdom and European Law, is treated as part of the UK and European Union (EU) for Customs , Excise and Value Added Tax (VAT ) purposes. The benefit of this is that the Isle of Man Customs and Excise can, through its Entry Processing Unit (EPU) housed within the UK’s Customs Handling of Import and Export Freight (CHIEF) Computer system, provide importers and their agents with the Ability to electronically declare goods imported to or exported from the United Kingdom / Isle of Man. Currently the system allows for electronic clearance without the need for the goods to physically travel to the Isle of Man. It is expected that a system of “Centralised Clearance” will be introduced across the EU.

Structures
The Isle of Man has two prime bodies of company law – the Companies Act 1931–2004 and the Companies Act 2006. There is some overlap between the sets of legislation, but essentially a company formed under the 1931 Act is a more traditional style of company with extensive legislative provisions. The 2006 Act company legislation is designed to be more flexible and modern. That being said, 2006 companies are being used for a comprehensive variety of transactions including listing on exchanges throughout the world, owning property, trading and general investment vehicles. Both vehicles can be registered for VAT as mentioned above.

There are no restrictions on who can own the shares in Isle of Man companies and there are no permissions required for the raising of capital. There are applicable provisions in respect of the public distribution and promotion of the shares in Isle of Man companies. The 1931 provisions are more formalised in the traditional prospectus sense whilst the requirements under the 2006 Company in simple terms require the prospectus to contain sufficient information for an investor to make an informed decision.

The Isle of Man also has Limited Partnership legislation, limited liability companies and Protected Cell Legislation which can be very useful for structuring.

As a Common Law jurisdiction Trust law is well established in the Isle of Man and can be part of the structure to hold shares. The Isle of Man also has the concept of Purpose Trusts which works well for structuring joint venture arrangements. Foundations are another vehicle that can be very useful for structuring as an alternative to a trust or company. The foundation is a statute based entity and is a favourable option for certain jurisdictions which are familiar with the concept.

Taxation Generally
The Isle of Man does not tax the income or capital gains of companies domiciled on the Isle of Man if they are owned by non-IOM residents.

Additionally, there is no stamp duty, inheritance tax or withholding tax. Probate fees are minimal.

However, there are various tax considerations regarding remittance of income that are imposed by the UK tax authorities. The advice in respect of any structure would need to be tailored according to the details of the structure.

Multi-Jurisdictional Structuring
There are no prohibitions on an Isle of Man company or other structure either being owned by non-IOM structures or individuals and similarly there are no restrictions on what an Isle of Man structure can own.

Isle of Man structures are involved in many structures and there are some well-established examples involving Canada, Ireland, UK Mauritius, Delaware, Hong Kong and Singapore, as well as European companies to name a few.

The reasoning can be both legal and for fiscal efficiencies as well as simply being pragmatic. For example, an investment may be in a company and it could be more efficient to buy the company rather than the investment directly.

Recent changes in the regulatory approach in the Isle of Man have seen the combining of the former pensions authority and financial services commission into one body known as the Isle of Man Financial Services Authority (FSA). This move is part of a response to the legal and financial services industry support for a commercial and progressive environment to support growth sectors while maintaining and enhancing the Isle of Man’s reputation as a jurisdiction of excellence.

FSA is now responsible for the Captive Insurance Industry which will not be governed by Solvency ɪɪ as well as the Life Industry that will be subject to Solvency ɪɪ. This two tier approach is indicative of the pragmatic and resourceful approach of the Government and the FSA to meet industry needs.

A product which has had strong legal input has been the development of a crowd funding regime and new banking model to support traditional banking partners.

The Isle of Man has a lot to offer: a well-run regime with strong growth and forward-thinking that makes it the place to make things happen.

Lawyer

Law in the 21st century: Am I a lawyer or a salesperson?

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In this ever changing world, our clients’ demands are changing and so are our roles as lawyers.Once upon a time, clients deferred to our greater knowledge and came to us because we helped meet a need or solve a problem and once they were a client, they were a client for life.

However, clients’ expectations have changed as the world has become a much smaller place, thanks largely to the internet.There are currently around 11,000 law firms in Great Britain and, while that number may be declining, clients understand that there are more than enough to cater for every type of need.  It is no longer necessarily the case that the magic circle firms are the lawyers of choice for the super wealthy, or the high street the place to go for your conveyancing or wills.  It is also not necessarily true that there is less work to go around.  Clients are buyers of goods and services and they have become very savvy at getting what they want.  Whether it is price or service, never before have lawyers had to work so hard to bring in new clients and keep hold of existing ones.

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The market is picking up, but law firms continue to talk about there being less work than there used to be.  It will, however, be the case that some lawyers are losing more potential and existing clients than others.

In fact, what is happening is that, as the market has opened up, those businesses that have entered have been very good at selling themselves, whereas many established lawyers and law firms have been slow to adapt to this new way of doing business. So what does the 21st century lawyer have to do to keep their existing clients happy and win new ones?

 

1. Forget about price, focus on value

If what you are selling is ‘price’, then unless you are set up correctly to offer your services cheaply, you are just going to have to work harder to bring in the same money, let alone increase your turnover. You will soon find yourself on the fast train to stress and burnout. The legal profession is No. 1 at selling itself short so as competition increased, prices went down and many clients were more than happy to accept this, even though they didn’t actually ask for it. All this has led to is the decline of small law firms as they continue to be pushed out of the market.  And it happens because lawyers have either forgotten or do not know how to sell what they do.

2. Know your competition

If you don’t already know who they are, then do some research and find out.  Whether it is location, practice area or prestige, make a list.  Then write down what makes you different.  This isn’t a complicated process and works whether you are a sole practitioner or a magic circle firm.  Take an A4 piece of paper and make two columns: the first should be headed ‘Features’ and under this you should list everything that makes your firm different to your competitors.  Five is good, ten would be amazing.  However, it is the second column that is most important and is headed ‘Advantages to client’.  As you go through your ‘Features’ column, ask yourself the following question: “So what?”  A feature is only any good if it benefits the client, so if being the oldest law firm in the area offers no advantage to the client it is not going to convince them to either stay with you or leave their existing lawyer.

3. Get to know your clients and their needs

You were born with two ears and one mouth, so start using them in those proportions.  If you don’t know your clients, their businesses and their needs (both personal and commercial), then how can you possibly give them the best advice.  People love talking about themselves and business people love talking about their business, so listen to what they have to say.  Make notes and sooner or later you will find something that is stopping them from reaching the next level.

4. Knowledge isn’t enough

Clients know that you know what you’re doing – or you’d have been caught out by now.  And, as lawyers, we all have – shall we say – a healthy self-confidence.  The problem is that people don’t buy services like law, they ‘buy’ people, so not only do you have to get to know your clients, you have to learn how to connect with them.  That means being adaptable.  If you’re a talker and your client likes to get straight to the point, don’t go into detail about your weekend and the nice dinner you had last night – get straight to the point.  If your client prefers the bigger picture to the finer detail, don’t give them an hour of in-depth analysis, give them what they want.  Remember, they are the client, so being more like them will help with their confidence and build the rapport between you both.  Because if you can’t connect with your client, they will find someone who can.

Business development is the art of selling and lawyers cannot leave it to others to bring the work to their desks because clients will not stand for it.  They need to get to know their lawyer, who will become part of a team of trusted advisers.  Those lawyers that have figured this out are thriving.

 

Selling isn’t a bad thing to do, it’s the best thing to do!

rainmaking

Turn rejection into rainmaking

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business

Losing an existing client or failing to win a new one is incredibly frustrating and can sometimes leave you feeling baffled.

Whether it is a multi-million pound joint venture or a small house purchase, every lawyer spends time perfecting their pitch, letting the client know why their firm can do the job better than anyone else. So to find out that the client has taken their business elsewhere can be a huge source of disappointment.

More so, it is a missed opportunity. Particularly with potential clients, once the job has been lost, we may never speak to them again. But why is that? Fine, the client may not feel the need to contact us, but why do we let them slip through our fingers forever. Most people will need legal services more than once in their lifetime, so just because you lost out on that deal this time, doesn’t mean you should write that client off forever.

rainmaking

Lawyers tend to be guilty of this more with potential clients than with existing clients. With existing clients that go elsewhere, lawyers that have a good understanding of client relationships still keep in contact with their old clients to let them know that they are still here if they are ever needed.

What about potential clients? You have had the meeting, spoken about the transaction, quoted for or estimated its cost and the client has decided to go elsewhere. So why don’t you ask if you can keep in touch with them? The easy answer is to say that lawyers are arrogant and, if the client doesn’t want us, we don’t want them. But that is not really the case. The answer is much simpler: they were never clients in the first place, so it is easier to believe that they wouldn’t want us to call them than to have the confidence to ask if it would be ok if we called every so often to see how they or their business are doing.

The reality is, when it comes to winning clients, ‘No’ doesn’t have to mean ‘No and good riddance’. If you did your background work well when you had the client meeting, you will know there are possibilities for the future. As you would do with an existing client, ask the potential client if you can keep in touch; that you would like to know how the transaction goes.

Then diarise to call the client again around the time you said you would have the transaction finished (a good CRM system will help with this). This is your first marker to compare your services with the firm the client chose to use. If the transaction isn’t finished, find out why; it could be that the lawyer they are using has been slow or was less-equipped to get the job done. If it has completed, find out how it went, if the client was happy with the service and what their plans are next. If your background notes suggested follow-up work could be done, ask if it is getting done. If it is not, why not? This could be where you step in and fill the gap left by the current lawyer. And if the follow-up job has been taken care of, diarise to call again, just to say hello. The client will appreciate the fact that you haven’t given up and that you have taken an interest in their longer term goals.

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Yes, it takes time, but business development and relationship building is part of what a lawyer has to do and this is a much more effective way of winning clients than going out to networking events, ticking off that box and then waiting for the work to come to you.

Most lawyers simply don’t appreciate how valuable this type of business development is. You have been given the opportunity to interact directly with a potential client rather than through or because of an intermediary, yet you let the client walk away forever.

And if you’re really clever, you’ll speak to the client about all the other services your firm provides, so that even if they do not need you now, they might need one of your colleagues in another department, thereby showing off your cross-selling skills to the partners and you very quickly develop a reputation as a rain maker.

Think about how many existing or potential clients have said “Thanks, but I’m going to use someone else” and your response was essentially “Ok, bye” and you never spoke to them again. Now imagine how many more contacts (and therefore potential clients) you would have if, instead of saying “Ok, bye”, you said “Ok, but let’s keep in touch”.