Even as change has been force-fed on many governments and jurisdictions in the aftermath of the economic slowdown, Labuan International Business and Financial Centre has been independently implementing changes on a stage-by- stage basis.
The latest move was the passage and finally the enactment on 11 February 2010 of 4 new laws with 4 others radically amended to transform the business scene in the jurisdiction.
Labuan IBFC, relatively unknown compared to the Caymans or British Virgin Islands, is however, regarded by those who do know it as a safe, and attractive jurisdiction robustly regulated by the newly re-named Labuan Financial Services Authority (Labuan FSA, previously Labuan Offshore Financial Services Authority or LOFSA). Labuan ranks alongside other domiciles on the OECD 'white list' of locations that have signed exchange of tax information agreements with at least 12 of its treaty partners.
The jurisdiction is already home to more than 7,400 companies; 60 banks; 150 insurance entities; 23 Trust companies and scores of service providers including lawyers, accountants, tax consultants, audit and secretarial staff.
Labuan's strategic location in the heart of South East Asia, off the north west coast of Sabah, Malaysia, has many benefits especially with the current 'flight to quality' plus the continuing economic boom in China and India encourage investments to flow eastwards.
Changes in the way the jurisdiction operates began in January 2008 when it re-named and re- positioned itself as Labuan IBFC in keeping with its goal to be the premier IBFC in the Asia Pacific region. In line with this objective, Labuan identified five key areas of focus, namely, holding companies, Islamic finance, insurance including captive insurance, private wealth management and fund management. A dedicated unit to market and promote Labuan was set up, followed since then by the legislative changes.
The laws in force comprise the new Labuan Islamic Financial Services and Securities Act 2010; Labuan Financial Services and Securities Act 2010; Labuan Foundations Act 2010; Labuan Limited Partnerships and Limited Liability Partnerships Act 2010 while the four amended Acts are the Labuan Companies Act 1990; Labuan Business Activity Tax Act 1990; Labuan Financial Services Authority Act 1996 and Labuan Trusts Act 1996.
Labuan Islamic Financial Services and Securities Act
Since Labuan took on the mantle of 'first mover' in Islamic finance starting with the...