Saturday, June 30, 2007

(Proven) Green Taxes – 2

Do green policies achieve what they are aiming at, or actually aggravate environmental problems? On 28 June a BBC Radio4 Today programme discussion on bio-diesel crops, it was suggested that to replace ordinary food crops with bio-diesel ones may not be environmentally clever. The point was made however that if the only crops that will grow in a location are bio-diesel ones then it probably is effective. Sometimes so many side effects of green policies need taking into account that it is difficult to justify them.

There is one area of green taxation that has proved to be effective on several counts. See the website: (click ‘Themes’ and then ‘Split Rate Taxation’). Look at the various examples of the property taxation of land values and building values. The higher the ratio of land value tax to buildings tax the less farmland is taken for building, the more efficient is the use of existing roads and drainage, and the less urban sprawl results. For over 25 years in the US State of Pennsylvania the results have been coming in to prove these facts. Comparisons can be made with similar towns which have not taxed the land of plots more highly than the buildings on them and in these cases such environmental (and also social) results are markedly poorer. Someone has studied 237 cases of Land Value Taxation world-wide and found similar improvements in all of them.

Our new UK Prime Minister, Gordon Brown should allow local authorities the option to tax land values as well as building values to raise their Council Tax. It is not a risky green tax policy – it has been proved to work. Read the book The Free Lunch –Fairness with Freedom for more on such themes and their beneficial outcomes.


Any source

Are biofuels to blame for agflation?

The UK's consumer prices index showed annual food price inflation of 6 per cent in April, the highest level in almost six years and well ahead of overall inflation of 2.8 per cent. In the US, prices have risen by 6.7 per cent, seasonally adjusted, since the beginning of the year, compared to 2.1 per cent for all of 2006.

There are some proximate factors driving food prices. Florida promises the smallest orange crop in 17 years. Swine fever in China has pushed up local pork prices. Coffee prices have been pushed up by adverse weather affecting production in Vietnam and Brazil, the two largest producers.

Of course, the relationship between food prices and inflation in general has been weakening. In the late 1940s food accounted for 43 per cent of the US consumer price index. By 1975 it was down to a quarter and its weight in the basket is now just 14 per cent.

Biofuels are gradually taking over as the main growth driver of agricultiral demand, Goldman Sachs says that if government policies are adopted in full, global demand for biofuels could increase from 10bn gallons a year to 25bn gallons by 2010. In the US ethanol production accounted last year for 16 per cent of the corn (maize) crop. If farmers are to fill cars as well as stomachs, then there is an argument for structurally higher prices of some agricultural commodities.

Of course, one response in a market system is to increase production, although this is ultimately limited by the availability of suitable land. Indeed, global grain production will rise by 6.2 per cent to a record 1.666bn tonnes in 2007-08, according to the International Grains Council. However, this will not match global consumption forecast at 1.680bn tonnes.

China's Communist rulers are worried and have announced a moratorium on the production of ethanol from corn and other food crops. In China grain security has been at the top of the party's political priority list and a 43 per cent increase in the price of China's staple meat - pork - triggered concern at the highest levels of the party.

The European Commission argues that its 10 per cent 2010 target for biofuels will not put a great strain on food markets. Their analysis suggests that prices for agricultural raw materials in the EU would rise by 3-6 per cent for cerals and 5-18 per cent for the major oilseeds as a result. As the cost of cereals makes up only 1 to 5 per cent of the consumer price of bread, which means that bread prices would increase by less than 1 per cent.

Although concerns have been expressed that planting biofuel crops may contribute to deforestation, biofuels do have clear environmental benefits. Corn-based ethanol gives 35 per cent more energy than it takes to produce. Greenhouse gas emissions per gallon of fuel used are 18 to 29 per cent lower with ethanol than with fossil fuels.

Biofuels are politically popular in the States because they give an income boost for farmers in the electorally marginal Mid West and also seek to address the country's security concerns about energy dependence on the Middle East. President Bush wants the country to produce 35 billion gallons of corn-based ethanol, a goal that will require an additional 129,000 square miles of farmland, an area the size of Kansas and Iowa combined.

What are implications for the CAP? In an ideal world, the promise of improved market returns should mean that farmers, particularly big grain farmers, would have less need of subsidy. Farmers would no doubt argue that they are recovering from a long period of low incomes and that indeed their real incomes has been falling for a century (although in practice this is offset by much larger scale operations that secure economies of scale).

A real concern is that the rush to biofuels will boost food security discourses. These are seen as the best bet by those who want to return to discredited productionist orthodoxies and to make the claim that farming cannot function as a normal commercial activity but should be subsidised.Any source

Thursday, June 28, 2007

BVI offshore industry establishes new record in 2006 and goes for more

It is nothing new if I say that the BVI is one of the most popular offshore jurisdictions and that BVI International Business Companies (or, in accordance with the new Business Company Act, Business Companies) are the most popular offshore entities ever registered. More than a year ago I mentioned that there are around 720,000 IBCs registered in the BVI. Now we have the new data from British Virgin Islands Financial Services Commission and International Finance Centre revealing the jurisdiction's new records.

The figures provided by the British Virgin Islands FSC and IFC have shown that in 2006 65,284 Business Companies were registered in the British Virgin Islands, which is a 12% increase as compared with 2005. This outstanding result is a new record for annual BVI company registrations set by the offshore centre. Previous record belongs to year 2000 when 64,000 IBCs were registered in one just year.

As to the total number on BVI Register, there were around 775,000 of both types of BVI companies – International Business Companies and BVI Business Companies – as at December 31, 2006.

Chief Operating Officer at the BVI International Finance Centre, Humphry Leue, commented that another record year for company registrations in the British Virgin Islands signifies that “the transition from the hugely popular BVI International Business Companies Act to the BVI Business Companies Act has been both seamless and effective in keeping this jurisdiction at the forefront of the international business industry”. He also added that the BVI continues to make its offer of financial services more diversified.

According to Humphry Leue, in 2006, 57 new captive insurers were registered, and the total reached over 400 captives – so, the BVI became the 3rd largest offshore centre for captive insurance business. Also, it gained a further 282 investment businesses in 2006, and the total for that sector was around 2,600 active mutual and hedge funds when year 2007 started. It also should be indicated that further growth is expected this year.

The statistics published by BVI FSC provides similar data. The total number of captive insurers as at December 31, 2006 is exactly 400 (not >400 as stated by IFC) and total number of active mutual funds is 2,571.

Mr. Leue noted that the feedback from private sector and Regulator is more important than the figures themselves, and the feedback that the quality and diversity of the business coming to the BVI is impressive means that the British Virgin Islands has been recognized “as a leading jurisdiction for the conduct of legitimate and value-added business”.

YearBVI companies incorporatedTotal number of companies on the BVI Register at the end of year

In the table above and graph below I have summarized BVI IBC (BC) incorporation statistics for the last 4 years and I feel that more breaking records are eagerly expected in 2007.

Article any source

Wednesday, June 27, 2007

New BVI Constitution Approved by British Privy Council

British Virgin Islands Chief Minister Orlando Smith announced the approvement of the Virgin Islands Constitution Order 2007 by the Privy Council in London. Orlando Smith informed that he received the corresponding letter from Lord David Triesman, Parliamentary undersecretary of state for the Foreign and Commonwealth Office. The new document will come into effect on the dissolution of the BVI Legislative Council, which should be made by July 10 with general elections constitutionally due by October. The appointment of a Cabinet Secretary will also take effect only after the elections.

A constitutional commission was established in the territory after the British government decided in 2001 to invite UK Overseas Territories to appoint local commissioners to review and make recommendations on the advancement of their constitutions. The Constitutional Commission was appointed in the BVI in April 2004. On April 15, 2005 the report was formally handed to BVI Chief Minister, based on the comments and opinions received from a wide part of the community. After the report was accepted by Executive Council, there were four rounds of constitutional negotiations, the last of which took place from February 26 to March 2. At the end of this final round, Orlando Smith reported that the BVI had 95% of the proposals.

Gov. David Pearey, the British government's representative in the BVI, also welcomed the announcement on Thursday. He congratulated all sides in the negotiations for their contribution to the creation of the new constitution. Pearey said, "This is an historic day for the BVI. The new constitution, now approved, is the first complete revision since 1976 and fully reflects the BVI's current political maturity."
Article any source

Monday, June 25, 2007

BVI is 2nd largest source for Hong Kong, accounting for 22.2% in Q1

The Census & Statistics Department of Hong Kong has released the data that indicates the British Virgin Islands as one of the top destinations for Hong Kong's external factor income outflow and inflow in the 1st quarter of 2007.

According to the Census & Statistics Department, comparing Hong Kong's GNP with a year earlier, it rose 11.9% to $397.7 billion in the 1st quarter of 2007.

During the period, the GDP, estimated at $370.3 billion, recorded the growth of 6.6%. Accordingly, the value of Hong Kong's GNP was larger than that of Hong Kong's GDP by $27.4 billion in the 1st quarter, which represents a net external factor income inflow of the same amount and equivalent to 7.4% of GDP in the 1st quarter. Within total factor income inflow, direct investment income rose 28.8%, portfolio investment income grew 17.5% and other investment income – 43.7%. As to total factor income outflow, within it, direct investment income grew 15%, portfolio investment income and other investment income grew 13.6% and 24% respectively.

Analysed by country/territory, the British Virgin Islands was 2nd only to China, which remained the largest source of Hong Kong's external factor income inflow in the 1st quarter, accounting for 27.9%. The BVI had external factor income inflow that accounted for 22.2%. It was followed by the United Kingdom and the United States, at a share of 9.5% and 8.9% respectively.

As to Hong Kong's external factor income outflow in the same period, China and the BVI continued to be the most important destinations with quite insignificant difference – China accounted for 24.5%, while the BVI accounted for 23.2%. The two leaders were followed by the Netherlands, accounting for 10.6%, and the United States accounting for 7.1%.
Article any source

Saturday, June 23, 2007

New French farm minister is not good news

French farm minister Christine Lagarade only lasted a month in the job before being promoted to finance minister and her successor, Michel Barnier, is not good news if you are a reformist.

He said on Tuesday that his experience as a European Commissioner could help him defend the interests of French farmers within the EU and on a global level. The 56-year old is familiar with the workings of the European Union from his time as commissioner for regional policy and institutional reform from 1999-2004, when he managed the second largest EU budget after agriculture. He was also French foreign minister from 2004 to 2005, but was replaced after French votes rejected the EU constitution in a referendum.

'I will say now what I have always said when I was foreign minister: the common agricultural policy is not an archaic policy. It's modern,' he told RTL radio. So French farmers have nothing to fear, but the rest of us do.

Sarkozy is basically a conservative (he is certainly not a liberal) and he has more important agenda items than agriculture where basically his strategy seems to be not to offend the powerful French farmers lobby.

When I was in Paris, one questioner when I gave my paper suggested that the SFP was deliberately introduced to give a more transparent instrument that would draw public attention to the payments made to big farmers. I do not think the reformist camp was that smart.

In any case, actually getting hold of this information and publishing it is quite difficult as is evident from Jack Thurston's blog at Farm Subsidies Four countries have declined to supply the information and for most member states, including the UK, only partial information is available.Any source

Friday, June 22, 2007

BVI Shipping Registry to be Upgraded to Category 1 Red Ensign Group

The British Virgin Islands will be able to welcome megayachts to its shores for the first time since the country has started the launch of its tourism industry sector. At the Red Ensign Group (REG) Conference held in Guernsey it was announced that the Secretary of State for Transport has agreed to upgrade the British Virgin Islands Shipping Register (VISR) to Category One status limited to general cargo ships.

The decision was preceded by consultations between the Maritime & Coastguard Agency (MCA), the Foreign & Commonwealth Office (FCO), VISR and with the BVI Governor and his staff. The BVI has recently completed a 3 year programme to meet REG Category 1 standards.

The monitoring visit to the BVI was carried out by the MCA in October 2006, and the VISR was found to have met the technical requirements to become a REG Category One Register limited to general cargo ships including large commercial yachts.

The VISR upgrade to Category 1 status will be implemented by an order made under Section 18 of the Merchant Shipping Act 1995.

Red Ensign Group (REG), in addition to the United Kingdom, includes shipping registries of Anguilla, Bermuda, tne BVI, the Cayman Islands, the Falkland Islands, Gibraltar, Guernsey, St. Helena, the Isle of Man, Montserrat and Turks and Caicos Islands.

Annually, the REG meets in a member country to exchange views on policies and technical issues involving regulation, marine safety, etc. The decision to upgrade the BVI was made after consultation with the UK's Maritime and Coastguard Agency, the Foreign and Commonwealth Office, VISR and other BVI government officials.

The BVI Shipping Registry was officially launched in September 2006, and operated as a Category Two Red Ensign British Registry, which can register ships of up to 150 gross tons, and pleasure vessels of up to 400 gross tons.

Concerning the current upgrade, BVI Chief Minister Orlando Smith said, “This announcement is of great significance, as it will position the BVI to attract large cargo vessels of unlimited tonnage and megayachts of up to 3,000 gross tons."

Smith also said that the upgrade will create opportunities for new sources of government revenue from ship registration fees as well as positive prospects in a number of areas for private businesses. He also said that once the legal process is finalized, the decision will be approved formally by the Privy Council.
Article any source

Thursday, June 21, 2007


Congratulations to our client, Sheila A. Laffey, President of Echo Mountain Productions on the completion of principal photography on her new documentary South Central Farm which tells the heartbreaking true story of the plight of a community of poor urban farmers and their supporters in South Central Los Angeles.

Given a barren plot of vacant land, after the L.A. riots in Watts, this group of dedicated individuals and families turned a concrete desert into an urban oasis. They created the largest urban garden in the country that fed a community of 350 families in need, as well as those who visited their markets, and sheltered birds and other wildlife, only to have it taken away from them and destroyed. The issue remains in the courts.

The film examines the environmental, health and social advantages of urban farms, their ability to create safe, sustainable environments for families, and produce nutritious and plentiful food sources to inner city communities in greatest need, as well as to many visitors. Social and cultural benefits shown include multi-generational and ethnic dynamics, spontaneous learning situations, free child care, mentoring and fostering of indigenous values of the commons and land stewardship. Environmental benefits include diversification of the seed bank, re-charging of the local aquifer, less urban runoff and cleaner air.

The film focuses on people growing their own source of food at the farm, as well as celebrity tree sitters such as Daryl Hannah, Joan Baez and Julia Butterfly Hill, and other supporters such as Martin Sheen and Willie Nelson who brought international attention to the issue. Supporters include Bonnie Raitt, Jodie Evans and James Cromwell and Environmental Media Fund.

Additional completion funding is needed to meet the distribution deadline of July 1 for the Natural Heroes PBS series which wants to air the film in its upcoming third season if the film is completed by July 1.

The International Documentary Association (IDA) is the fiscal sponsor of the Documentary. Donations over $200 that donors wish to be tax deductible can be mad payable to IDA and sent to Echo Mountain Productions for forwarding to IDA. IDA will send a letter to donors acknowledging the not for profit donation. Donations under $200 or donations for more that do not need to be tax deductible can by made payable and sent to Echo Mountain Productions, 1301 17th St., #101, Santa Monica, CA 90404. A trailer and budget are available upon request. For more info contact Sheila at 310-45304272;


One method that independents have used to finance films is to borrow the money to produce the film by using pre-sale agreements as collateral.

In a pre-sale agreement, a buyer licenses or pre-buys movie distribution rights for a territory before the film has been produced. The deal works something like this: Filmmaker Henry, or his sales agent, approaches Distributor Juan to sign a contract to buy the right to distribute Henry's next film. Henry gives Juan a copy of the script and tells him the names of the principal cast members.

Juan has distributed several of Henry's films in the past. He paid $50,000 for the right to distribute Henry's last film in Spain. The film did reasonably well and Juan feels confident, based on Henry's track record, the script, and the proposed cast, that his next film should also do well in Spain. Juan is willing to license Henry's next film sight unseen before it has been produced. By buying distribution rights to the film now, Juan is obtaining an advantage over competitors who might bid for it. Moreover, Juan may be able to negotiate a lower license fee than what he would pay if the film were sold on the open market. So Juan signs a contract agreeing to buy Spanish distribution rights to the film. Juan does not have to pay (except if a deposit is required) until completion and delivery of the film to him.

Henry now takes this contract, and a dozen similar contracts with buyers to the bank. Henry asks the bank to lend him money to make the movie with the distribution contracts as collateral. Henry is "banking the paper." The bank will not lend Henry the full face value of the contracts, but instead will discount the paper and lend a smaller sum. So if the contracts provide for a cumulative total of $1,000,000 in license fees, the bank might lend Henry $800,000.

Henry uses the loan from the bank to produce his film. When the movie is completed, he delivers it to the companies that have already licensed it. They in turn pay their license fees to Henry's bank to retire Henry's loan. The bank receives repayment of its loan plus interest. The buyers receive the right to distribute the film in their territory. Henry can now license the film in territories that remain unsold. From these revenues Henry makes his profit.

Juan's commitment to purchase the film must be unequivocal, and his company financially secure, so that a bank is willing to lend Henry money on the strength of Juan's promise and ability to pay. If the contract merely states that the buyer will review and consider purchasing the film, this commitment is not strong enough to borrow against. Banks want to be assured that the buyer will accept delivery of the film as long as it meets certain technical standards, even if artistically the film is a disappointment. The bank will also want to know that Juan's company is fiscally solid and likely to be in business when it comes time for it to pay the license fee. If Juan's company has been in business for many years, and if the company has substantial assets on its balance sheet, the bank will usually lend against the contract.

In some circumstances banks are willing lend more than the face value of the contracts. This is called gap financing, and since the bank is assuming a greater risk of not being repaid its loan, higher fees are charged. Gap financing is helpful if the filmmaker is unable to secure enough pre-sales to cover the loan. The bank lends more than the amount of pre-sales based on its belief that the gap will be covered when unsold territories are licensed. Before agreeing to supply gap financing, the bank will carefully review the existing pre-sales, and extrapolate from those sales an estimate as to what other territories might fetch. The estimate is based on the bank's experience that a film licensed to Italy for $150,000, usually fetches $100,000 in Spain. Of course, there is no guarantee that when the film is completed that a Spanish buyer will license the film, so the Bank wants to see projected revenue that is at least twice the amount of any gap. This ensures that even if some territories remain unsold, the gap is likely to be covered. Moreover, the bank will rely on the reputation and track record of the sales agent and/or producer in judging whether these estimates are realistic. Banks may decline to lend funds based on projections from a sales agent with a history of overly optimistic projections.

The bank often insists on a completion bond to ensure that the filmmaker has sufficient funds to finish the film. Banks are not willing to take much risk. They know that Juan's commitment to buy Henry's film is contingent on delivery of a completed film. But what if Henry goes over budget and cannot finish the film? If Henry doesn't deliver the film, Juan is not obligated to pay for it, and the bank is not repaid its loan.

To avoid this risk, the bank wants a completion guarantor, a type of insurance company, to agree to put up any money needed to complete the film should it go over budget. Before issuing a bond , a completion guarantor will carefully review the proposed budget and the track record of key production personnel. Unless the completion guarantor is confident that the film can be brought in on budget, no completion bond will issue.

First-time filmmakers may find it difficult to finance their films based on pre-sales. With no track record of successful films to their credit, they may not be able to persuade a distributor to pre-buy their work. How does the distributor know that the filmmaker can produce something their audiences will want to see? Of course, if the other elements are strong, the distributor may be persuaded to take that risk. For example, even though the filmmaker may be a first-timer, if the script is from an acclaimed writer, and several big name actors will participate, the overall package may be attractive.

Nowadays it is very difficult to finance a film completely through pre-sales. There are many completed films available for acquisition, and a distributor needs a compelling reason to take the extra risk present when one licenses a film that does not yet exist. There is much less risk in licensing a film that has been completed, because you know exactly what you are buying even if you don't know how popular it will be with the public. Consequently, independent films today are often financed with a combination of pre-sales, equity investors and various production incentives offered by states and nations. This article is based on an excerpt from Risky Business, Financing and Distributing Independent Films, by Mark Litwak, published by Silman-James Press (2004).


If the motion picture is finished, you should register it and the underlying script by sending in Form PA with a cassette of the finished film and an attached synopsis describing the film. If you are still at the script stage, you can register the script now and register the film when complete.
In either case, closely follow the instructions on Form PA. The following guide addresses those sections that applicants often find confusing when registering scripts or motion pictures. Remember to complete all applicable sections of the form, not just those discussed below.

Registering a Script

Under #1, Nature Of This Work, you could write "Screenplay for Motion Picture."

Under #2, "Name of Author": Note that if a screenplay has been written for you or your company, in other words, if you hired someone to write the screenplay, then it may be a work-made-for-hire. In this case, you or your company is the copyright holder and should be listed under "Name of Author."

On the other hand, if a writer has created the screenplay on his own, and he is then selling it to you, the writer would be the author. If this writer has already registered their script with the Copyright Office, you should not register it again, but merely record the transfer (assignment) of the copyright to you. The copyright should be assigned to you or your company with a written contract, and a short form copyright assignment recorded with the Copyright Office.

Under "Nature of Authorship," you should give a brief general description of the author's contribution to the work. If the author wrote the entire script you might write: "Entire Text." If you are claiming copyright to something less than the entire script, describe your contribution, for example, "Editorial Revisions."

Registering a Completed Film

Under #1, "Nature of This Work," write: "Motion Picture."

Under #2, "Name of Author": Usually this will be the name of the Production Company or entity that hired everybody who made the motion picture. If this is project was entirely a work made for hire, check "Yes" under "Was this contribution to the work a 'work made for hire'."

Under "Nature of Authorship," write in "Screenplay and adaptation as motion picture."
If this motion picture was not at all a work for hire, fill in the name of the person(s) who made the motion picture, and check "No" under "Was this contribution to the work a 'work made for hire'."

Under "Nature of Authorship," write in "Screenplay and adaptation as motion picture."
If this motion picture was partly a work for hire, and partly not, you'll need to fill in a space for each part. For example, if your production company made the motion picture as a work for hire but bought a completed screenplay from a writer who was its author, then you would fill out two spaces:

In one space, you could fill in the writer's name as author, check NO under to the question of whether it was a "work made for hire," and fill in "Screenplay" or "Script" in "Nature of Authorship."

In another space, you could fill in the production company's name, check YES indicating it is a "work made for hire," and fill in "All other cinematographic material" under Nature of Authorship."

Under section 5, if the motion picture contains a substantial amount of previously registered material, answer "Yes," to the first question and check the box indicating the reason for this registration. Include the registration number and year of the previously registered material.
Fill out #6a & b only if the work has a significant amount of previously registered, previously published, or public domain material.

Under #6a, "Derivative Work or Compilation," you could write in "Previously registered screenplay."

Under #6b, "Material Added to This Work," write "Motion Picture."
You are required to deposit a copy of your film within 3 months of publication. If you do not, you may be subject to fines and penalties.

In General

Complete #4, "Copyright Claimants," even if the Claimant is the same as the Author. The Claimant is the person or company that has legally acquired the copyright. It will be either the Author or the entity to which the copyright has been transferred. When the Claimant is not the Author, you need to describe under "Transfer" how the copyright was obtained by the Claimant. You could state, for example, "by written assignment."

Don't forget to include a copy of your script or film when you send in your registration form.You need to sign Form PA and send it in with a check for $45 payable to "Register of Copyrights." Retain a photocopy of everything you send the Copyright Office including the completed Form PA and your cover letter. It is a good idea to send your package by certified mail.

If you would like to put your attorney's name under "Correspondence" so that he/she can answer any questions the Copyright Office may have, you may do so. In this event, you should send your attorney a photocopy of the form and your cover letter so he/she will have a record of what you have submitted.

Mail to:Library of CongressCopyright Office101 Independence Ave., S.E. Washington, D.C. 20559-6000

Copyright circulars and forms are available from the Forms and Publications Hotline, (202) 707-9100 (leave a recorded message requesting the documents you want mailed to you), or on the Copyright Office website, The website also offers extensive copyright information. Circular 45 specifically addresses copyright registration for motion pictures. To speak to an information specialist, call (202) 707-3000.Any source

Wednesday, June 20, 2007

Green Taxes and Fairness -1

Planet saving activity is getting increasingly popular. Regulations get ever stricter against pollution and businesses face high fines if they transgress, thus there is commercial sense in finding greener solutions because they cut such costs. They also gain favour with consumers which is so important for marketing - see the example of Marks & Spencer (Blog: January 25).

But if the habits of tens of millions of ordinary people are to change in order to lower the use of natural resources on a meaningful scale, there will be a financial cost to them. The living standards of the mass of many voters are going to be cut. There is substantial resistance to the idea of green policies and anything that will help to overcome this should be tried to pacify the skeptics – just in case the measures will later be seen, even by them, to have been necessary.

The book The Free Lunch –Fairness with Freedom explains how one attraction of a Citizen’s Income, a regular payment to everyone, is that compensation is targeted at the extra cost of the basic use of essential resources if green taxes are imposed. High usage would be surcharged without a compensating Citizen's Income payment and thus force some lowering of consumption.

The other way to overcome the poverty-inducing effect of green taxation, is to extend means-testing of welfare benefits for more and more people. This would lead to higher taxation due to the increase in bureaucracy. Besides many of those who are entitled to help fail to apply due to the complexity and the risk of state claw-back when mistakes are made, or earnings rise.

There is a choice on how green taxes are handled and it depends on which viewpoint is taken as to the relative importance between the individual citizen and the state. The Citizen's Income idea is rising in international importance (see: ) - in the UK we already have part of it, in the form of the unconditional Child Benefit.

See: and buy the book.

Any source

Tuesday, June 19, 2007

New Director Appointed to BVI Chamber of Commerce & Hotel Association

BVI Chamber of Commerce & Hotel Association (BVICCHA) has appointed Averil Henry as a new executive director replacing Christy Almeida.

Averil Henry has a master's degree in organization management and more than 20 years of work experience in this area. Most recently, she was organization development manager with the BVI Tourist Board. Now she is pursuing a doctoral degree in organization management.

For the last six years Henry worked with the board. In addition to her experience in the tourism industry, she was working as communications specialist with the Health Department, English teacher at BVI High School and information officer with the Department of Public Relations and Information.
Article any source

Monday, June 18, 2007

COPA to smarten up its act

Casual explanations of the persistence of the CAP put it down to the strength of the 'farm lobby'. At a national level, there is some truth in this and the positions of member states in the Farm Council often reflect pressure from their domestic farmers' organisations. After all, upsetting them is likely to lead to a lot of trouble and very few plaudits.

However, the European farm level organisation, COPA, has been a shadow of its former self for some time. It was originally set up at the instigation of the Commission and had a close relationship with them through to the 1970s. But since then its influence has faded. This partly reflects a failure to grasp the extent to which the agenda on the CAP, and the acceptable justifications for subsidies, has been changing.

There have been a number of internal reviews of COPA, but the latest one opens up the prospect of change. According to new Secretary-General Pekka Psonen with the EU now having 27 member states, COPA cannot afford to be hostage to any single organisation. Hence, it looks likely that the current unanimity rule will be scrapped and replaced by a system of qualified majority voting.

Will COPA's thinking also be dragged into the 21st century? We shall have to wait and see.Any source

Sunday, June 17, 2007

Sarko's hard line could have a paradoxical end

The hard line being taken by France's new president, Nicolas Sarkozy, on the future of the CAP could have a paradoxical outcome: further re-nationalisation of the policy once seen as the cornerstone of the European Union.

Sarkozy has revived the notion of 'communiy preference', a term dating back to the 1950s which referred to favouring domestically produced goods over imports. The Commission's off the record reaction was 'That would be going back to the CAP of 20 years ago.'

The upcoming health check of the CAP will present some challenges for French policy. Farm Commissioner Mariann Fischer Boel wants aid to farmers to be fully decoupled from production, but France has been one of the most enthusiastic users of options for 'recoupling'. She is also thought to think that intervention purchasing should only be an emergency option.

In the longer run, Budget Commissioner Dalia Grybauskaite is said to favour a radical overhaul of the EU budget after 2013 with a major shift in spending away from farm support towards growth and competitiveness-related spending.

France will become a net contributor to the CAP after 2013. French centre-right MEP Alain Lamassoure, who has been advising Sarkozy on EU affairs, has published proposals which would see greater co-financing of support by national governments. This is not favoured in the Commission as a potential distortion of competition which would undermine the common character of the CAP.

Yet if the EU decides on cuts that are too radical for Sarkozy, or at any rate for domestic French opinion, the solution could be to pay subsidies to French farmers from national funds. Thus, the final outcome could be even more re-nationalisation of the CAP than that which arose from the compromises of the 2003 reform.

I shall be presenting a paper on the CAP in Paris on Thursday and it will be interesting to see what the state of French opinion is.Any source

Saturday, June 16, 2007


Check out the free internet law treatise at It is sponsored by the Electronic Frontier Foundation and is an open collaborative treaty summarizing the law relating to the internet.

Based on the publication Electronic Media and Privacy Law Handbook, published by Perkins Coie in 2003, it contains extensive information including sections on Defamation, Content and Speech Regulation, Copyright, Trademark, Misappropriation, Electronic Contracts and Privacy. It is still in Beta stage, and it is a wiki, or collaborative endeavor of many contributors who can edit the material, so one should be cautious about relying exclusively on it.


A federal judge has held that Marilyn Monroe's right of publicity did not survive her death. Consequently a the owner of photographs of her could sell images of the screen siren to commercial product manufacturers without paying a licensing fee.

The judge said Monroe did not have the capacity to grant property rights that she did not own at the time of her death.

Monroe's estate argued that it was the successor to Monroe's right of publicity, arising from her grant of the right in her will to actor Lee Strasberg, a friend of Monroe's. When Strasberg died, his heirs established a company to manage the intellectual property assets of the beneficiaries of Monroe's will. Monroe's estate claimed that Shaw Family Archives (SFA), owner of the photos, use of the actress's image violated its rights under Indiana's 1994 Right of Publicity Act. This law creates a descendible and transferable right of publicity that survives for 100 years after a person's death.

SFA contended that the Monroe estate could not lay claim to the rights because Monroe could only devise by will property that she owned when she died. Neither New York nor California, the only possible domiciles of Monroe at the time of her death, recognized such rights at that time. Moreover, Indiana also did not recognize such rights at the time.

Shaw Family Archives Ltd. et al. v. CMG Worldwide Inc. et al., No. 05-3939, 2007 WL 1413381 (S.D.N.Y. May 7, 2007).Any source

Friday, June 15, 2007

BVI Chief Minister Informs about BVI Economic Growth and Government Accomplishments in 2007

British Virgin Islands Chief Minister Orlando Smith has presented his annual State of the Territory Address for the year 2007 before more than 500 people. In his 15-page and 53-minute speech he informed about the accomplishments of his government and said that the gross domestic product of the British Virgin Islands by the end of the year will top the US$1 billion mark. He noted that last year growth rate was 11% and made the level of GDP at US$992 million.

By words of BVI Chief Minister, this year growth is first of all due to financial services and tourism. "Today, our financial services sector is a world leader, and our regulatory system has earned a reputation that is second to none for ethics, transparency and good judgment," he said. As regards tourism, Orlando Smith mentioned the increased number of cruise visitors in the British Virgin Islands.

Among other initiatives that helped create a foundation for growth, Smith named restoring fiscal discipline in government and overhauling the tax system. In his speech he said, "The economic growth we are enjoying is no accident...It is the result of the hard work, creativity and drive of the people of the BVI, and it was made possible by your government's commitment to changing the policies of the past by making economic growth a top priority."

Orlando Smith affirmed that the government is committed to carrying on the telecommunications liberalization process, as well as controversial five-star resort hotel developments on Beef Islands, Scrub Island and Smuggler's Cove.
Article any source

Tuesday, June 12, 2007

Russian FTS Considers the Need to Sign Double Tax Agreement with BVI

Russia's Federal Tax Service (FTS) has said that double taxation treaties should be concluded between the country and offshore jurisdictions, such as the British Virgin Islands, Gibraltar, the Normandy Islands and the Seychelles.

The opinion that Russia has to sign agreements on exchanging tax information with tax havens was expressed by deputy head of the FTS some days ago. Konstantin Sedov stated that Russia has agreements on avoiding double taxation with most countries in the world, but tax agencies are now exchanging information through those agreements only on direct taxes.

In his interview with the FTS' Russian Tax Courier magazine Sedov said that these agreements with offshore tax havens need to extend to indirect taxes to improve the exchange of information between the countries on this matter. He also informed that the Federal Tax Service has sent a proposal to the Finance Ministry to consider holding corresponding talks with the relevant agencies of foreign governments.

The fact that is worth mentioning here: British Virgin Islands are among the biggest direct investors in Russia in 2006, along with Cyprus, Britain, the Netherlands, Luxemburg, France, Germany, Switzerland and the United States.
Article any source

Monday, June 11, 2007

Water is not just an issue for Australia

Dry irrigation channel near Griffith, New South Wales

The long drought in Australia has now given way to serious floods in New South Wales. Apart from the fact that Australia is a competitor with the EU, what is the relevance for the CAP? With increasing evidence of global warming, the effective use of water is an issue that concerns everyone in the world. Adequate supplies of water for intensive agriculture are an increasing problem in many parts of Southern Europe and water abstraction for water intensive crops is an issue in many parts of southern and eastern England.

A few years ago I visited the town of Griffth, NSW. which is at the heart of an irrigation district in the Murray-Darling basin in an area known as the 'Riverina'. It is sometimes referred to as Australia's version of California's Sacramento Valley. The basin as a whole accounts for some 40 per cent of Australia's agriculture and 85 per cent of its irrigation.

My notes at the time stated, 'We visited an irrigated farm producing rice as well as wheat and canola. In the last year farms have only been permitted 38 per cent of their normal water extraction. The amount of water needed to produce rice has been reduced from around 16 mega litres a hectare to around 11, but this still leaves it as a very water intensive crop.'

Australian rice farmers lead the world in water conservation. Their water use per tonne of output is half the global average. But in the last growing season there was no water for the rice farmers around Griffith.

How it should look: irrigation channels at work

Droughts are nothing new in the Murray Darling because of the periodic El Nino weather pattern. However, irrigators were allowing too much water to be taken out of the Murray-Darling. By 1994 human activity was consuming 77 per cent of the river's average annual flow, even though the actual flow falls far below the average in dry years. The mouth of the river was beginning to silt up. Thanks to a combination of reduced flow and increased run-off from saline soils churned up by agriculture, the water was becoming increasingly salty.

Australia has a fragile ecology that supports a bewildering and amazing biodiversity. It is also the world's biggest exporter of 'virtual water' embedded in farm produce. Just 0.5 per cent of Australian farming is artificially watered, but it produces 23 per cent of agricultural output.

Economists argue that it would make sense for farmers to sell water from their allocations to cities, given that the average price of urban water is $A1000 per megalitre whereas farmers trade water between themselves at $A100 a megalitre in drought years. Politics also comes into it as the farmers generally support the National Party, Prime Minister Howard's junior coalition partner.

The reduction in the availability of Australian produce is one factor producing higher food bills across the world. This year's wine grape harvest has fallen by 30 per cent, the equivalent of 400 million litres. This has eased the wine glut that was hitting Australian producers, but means the end of the cut-throat discounting of the last two years.

And if a country as economically strong and politically robust as Australia has difficulties sorting out its farm water problems, what does that imply for the rest of the world?Any source

Saturday, June 9, 2007


AOL and other online services are not required to pay performance royalties on music downloaded over the Internet, according to a New York federal court. The court held that downloading a song is not a public performance of the song under copyright law.

Both parties had asked for partial summary judgment on the question of whether Internet downloads of music constitutes “performance” of music under the Copyright Act.

U.S. District Judge William C. Conner, found that a download involves copying a file from one computer to another. The file is stored on a recipient’s hard drive and can be copied to other devices such as digital music players.
Downloading, is a reproduction of a copyrighted work, but it is not a public performance right, Judge Conner said. The judge cited statements from the U.S. Copyright Office and the U.S. Department of Commerce, which have taken the position that digital downloads of music are not public performances of those works.

On the other hand, “streaming” is when a song is transmitted over the Internet to be listened to in real time. The file is not stored on the recipient's computer and must be “streamed” again each time the recipient wants to listen to it. The court acknowledged that streaming music is a public performance. United States v. American Society of Composers, Authors & Publishers et al., No. 41-1395, 2007 WL 1346568 (S.D.N.Y. Apr. 25, 2007).Any source


I recently attended the NATPE Mobile ++ conference in Las Vegas to find out how the ability to watch content on mobile devices will change the motion picture and television industry. I learned that there are now more mobile phones in the U.S.A. than people - guess some of us use more than one, and perhaps have a few older models sitting in a drawer. However, only 10 percent of those mobile phones have the capability to exhibit video footage. And only 10 percent of those capable are actually using their phones and mobile devices to watch such content.

Experts predict that the viewers of content on mobile devices are likely to grow exponentially. In the first quarter of 2006, the revenue from mobile video was $51 million; by the third quarter it had risen to $140 million, and mobile video is now a-half-billion-dollar-a-year market. The world has 2.5 billion cell phone subscribers, yet most don't have phones with the new third generation (3-G) technology.

Meanwhile, a new generation of devices is generating enthusiasm among consumers and competition among manufacturers. Samsung Electronics Co. has a new mobile phone, the Ultra Smart F700, which has many of the same features as the new Apple iPhone. The Samsung phone can access the Internet, play music, take pictures, show videos, handle e-mail and share photos. Its third-generation (3G) technology is faster than iPhone's EDGE system, and its 5-megapixel camera has better resolution than the iPhone's 2-megapixels.

Primetime viewing for mobile video is in the afternoon and early evening. According to consumer research firm Telephia, 30 percent of mobile video users watch mobile TV and video clips on their cell phones between noon and 4 pm, and 31 percent watch during the early evening commuting hours of 4 pm to 8 pm. Mobile video viewing drops to nine percent during the regular television primetime hours of 8 pm to 11 pm.

Contrary to popular belief, mobile video usage is being consumed by older age groups, as well as teens. 50 percent of mobile video users are 25-to-36-year-olds, compared to 24 percent of the total mobile population. In terms of gender, mobile video usage does resemble an early adoption profile, where 7 out of 10 users are men, compared to a nearly even male/female ratio for all mobile subscribers. Mobile video user demographics show an ethnically diverse population, with 16 percent of mobile video users being African-American and 27 percent Hispanic, compared to 11 percent for each group for general mobile subscribers. No one has explained why mobile video is so popular with these demographic groups. Surprisingly, 22 percent of mobile video watching is at home, the same amount as during commuting; 16 percent of mobile viewing is done while shopping, and 14 percent happens at work.

Mobile viewing is a personal experience, not often shared with others. News, weather and sports are currently the most watched content. ABC News was the most popular mobile TV channel in the second quarter of 2006, commanding 40 percent of the total mobile TV audience. Thirty-two percent watched The Weather Channel, while Fox Sports and ESPN followed with 31 and 29 percent, respectively.

With the spread of new high-speed 3G networks, distribution of porn is expected to surge. In 2006, adult mobile content generated about $1.4 billion in sales worldwide in a market where mobile entertainment overall generated about $17 billion, according to Juniper Research. While adult mobile content generated far less revenue than other types of entertainment such as the $6.6 billion revenue from music, it will likely grow rapidly over the next several years. By 2011, adult content is expected to account for $3.3 billion worth of mobile content sales out of a total of $77 billion in entertainment revenue. None of the large U.S. wireless carriers offer adult content programming, and there is concern about how to verify subscribers' ages. In Europe and in parts of Asia, carrying porn hasn't been a major issue with even the largest carriers such as Vodafone, Orange and T-Mobile.

The Sundance Institute recently embraced mobile content by joining with the GSM Association (GSMA), to create the Global Short Film Project, a pilot program to showcase independent short films to mobile users worldwide. Six filmmakers who have had films at Sundance received $20,000 each to create short films of three to five minutes for mobile distribution. "Cell phones are fast becoming the 'fourth screen' medium, after television, cinema and computers," according to Sundance Institute founder Robert Redford.

MobiTV, Inc. ( is one of the largest content providers with more than one million subscribers. The service is available in the US through Sprint, AT&T, Cingular, Alltel; in the UK through 3UK and Orange; in Canada through Bell Canada, Rogers and TELUS Mobility; in Latin America through América Móvil, Claro and Telcel; and other regional carriers internationally. The service offers many popular TV channels such as MSNBC, ABC News Now, CNN, FOX News Channel, Fox Sports, ESPN 3GTV, NBC Mobile, CNBC, CSPAN, The Discovery Channel, TLC, and The Weather Channel.

Subscribers need to sign up for data packages on top of their monthly voice fees in order to access video clips. Sprint Nextel offers packages for $15, $20 and $25 a month. Verizon Wireless V Cast service costs $15 per month. It is not clear how many consumers are willing to pay $9.99 or more per month for such a subscription, or whether an ad-supported free service is more likely to gain wide acceptance.

The ability to distribute independent films over mobile devices may enable filmmakers to reach consumers by bypassing the established networks and studio gatekeepers that have traditionally been uninterested in niche content and short films. It is by no means clear how the market will develop, and what opportunities will be available for independent filmmakers. But it is worth noting that seven billion dollars was spent last year on ring tones, and a hundred million user generated videos are viewed daily on YouTube.


Congratulations to our clients Writer/Director Cecilia Miniucchi and Executive Producer Antoni Stutz who feature film "Expired" will be shown as part of the Cannes Film Festival. It will be the closing film in Critics Week. Expired was the only U.S. picture to make it into Critics Week from over 600 features reviewed. The film which was first shown at Sundance. It is a bittersweet comedy starring Samantha Morton and Jason Patric.


I am executive producer of a new family film that commenced principal photography this past week in Spokane, Washington. It is a family comedy feature Diamond Dog, being directed and produced by Emmy-winning and DGA Award-nominated Mark Stouffer.

The film stars French Stewart (Clockstoppers) as the boss of a bumbling band of jewel thieves, with Kevin Farley (The Waterboy) and Kelly Perine (One on One) as his sidekick thugs.

The thieves have pulled off a $5 million jewel heist and are in town to make their connection, when a 12 year old boy - played by Luke Benward (How To Eat Fried Worms) -- rescues a dog from them after they threaten it. Unbeknownst to the boy, the dog is the mule they used to smuggle the jewels, and the thieves will do anything to get it back. The boy takes the dog, which he names Diamond, to his secret fort in the woods and prepares for battle. When the thieves come after him, the ingenious traps he's devised wreak havoc.

The film also features John Farley, Garrett Morris, Brittany Curran, Cameron Monaghan and Denyse Tontz.Any source

Friday, June 8, 2007

Court Division in BVI Approved by OECS

Last week the heads of government of the Organization of Eastern Caribbean States have approved the establishment of a commercial division of the OECS Supreme Court in the British Virgin Islands. Clyde Lettsome, permanent secretary in the Chief Minister's Office, has reported this week the results of the 45th OECS Authority meeting that he attended from May 23 to 25 in Grenada. He participated in this meeting together with Najan Christopher, the assistant secretary for external affairs with the BVI International Affairs Secretariat.

At this meeting the heads of OECS states discussed, among other agenda items, setting up the court in the British Virgin Islands by the end of September. The secretary said that the heads unanimously approved and supported the establishment of this Commercial Division in the BVI. Lettsome also noted that the commercial court is of great significance to the territory, and actually is one of the most important developments from last week's OECS meeting.

Lettsome also mentioned a concern echoed by the various OECS heads regarding the criteria for appointing Queen's Counsels in different jurisdictions.

Other issues of significance to the BVI, by words of Lettsome, were an OECS transport initiative, which is of particular relevance to the territory in light of trade; the current salaries review for staff and its implications for each member-state's financial contribution to the organization, and a presentation by the secretary of state from the Commonwealth of Puerto Rico on the ongoing relationship between Puerto Rico and the OECS.
Article any source

Wednesday, June 6, 2007

1Q China's export to British Virgin Islands - Information Released by China General Administration of Customs

By the data provided by Chinese governmental agency for the first quarter 2007, China's export to BVI in January reached 6,717,000 USD, and in January-March its level was 14,715,000 USD, that is down 48.9 % year on year. The following table released by the General Administration of Customs shows China's export to BVI in the period from 2004 to March 2007:

(Unit: 1,000 U.S. dollars)

Current monthCumulative total% Change y-o-y (Cumulative total)
2004 820-98.9
2005 22,1822605.1

At first glance it seems that China-BVI export indice is showing decline, however it is too early to make any serious conclusions. Although the 1st quarter indice is 48.9% below previous year cummulative export amount, it should be noted that there are very high fluctuations month over month and as we can see from historical data, counting only for February China’s export to BVI this year is 147 !!! times higher than in February 2006. On the other hand, the amount in March previous year was the 2nd highest in the whole year 2006.

There are many factors influencing China-BVI exports level and we should clearly recognise that this is also closely related to Foreign Direct Investments from the British Virgin Islands companies to Chinese economy.

Recent activities toward unification of China's corporate tax rate for both foreign and domestic companies (instead of around 33 percent for local companies and 15 percent for foreign companies) as well as warnings about taxation of world-wide income of companies incorporated in tax havens but having no double taxation agreement with China are just the latest factors we can observe. Currently the Republic of China has more than 80 bilateral treaties on double taxation, but British Virgin Islands are not among these countries, so there is potential threat that the amount of economic co-operation between China and British Virgin Islands can decrease in the future.
Article any source

Tuesday, June 5, 2007

Digicel vs BVI Telecommunications Regulatory Commission

Legal action that was taken by Digicel against telecommunications regulators of the British Virgin Islands, has been settled 2 weeks ago in favour of the license holder. Digicel's application for a mobile telecommunications license was rejected in February 2007 by the BVI Telecommunications Regulatory Commission, and on April 30 the company filed the application against the TRC in the BVI High Court; the company also once again expressed its interest in entering the BVI market.

Digicel's victory against the BVI government in the BVI High Court means that the Regulatory Commission has to consider the same application of this telecoms operator for providing telecommunications services on the territory.

Digicel claimed that its application to operate a GSM license in the British Virgin Islands had not been addressed in accordance with the Act, which stipulates that each application must be considered on an objective, transparent and non-discriminatory basis. On May 18 it was ruled by the Court that Digicel's application for a Judicial Review into the issuing of licences by the BVI Telecommunications Regulatory Commission succeeds on the reason that the TRC had acted unreasonably.

In the end of April, BVI government gave final approvement of Telecommunications Liberalization Policy, having invited the three currently licensed public suppliers to apply for licenses to operate across fixed line, mobile and cable sectors. By this other applicants were excluded from the process, among them were Digicel and Virgin Live Media.

In the opinion of the BVI government, it was not constitutionally or legally obliged to open the market immediately to full competition. The government also stated that Digicel had no unfettered right to apply for a license.

Justice of the High Court Rita Olivette argued that the Act provides no barriers to applicants wishing to receive license other than meeting the criteria defined by the legislation. Olivette also issued an order requiring the TRC to consider and determine Digicel's application filed on February, and ruled that the TRC must pick up Digicel's costs.
Article any source

Monday, June 4, 2007

Islamic finance in an experimental age
By Gillian Tett, Financial Times

When international bankers discuss Islamic finance, one word that repeatedly crops up is "innovation".

In the past five years, Islamic finance has not only swelled in size, but expanded in complexity, as bankers around the world have competed furiously to produce new, Sharia-compliant ideas - and proclaim how "innovative" they are being in marrying the Quran with modern finance.
Some of these claims need to be taken with a pinch of salt, given that the word "innovation" is often overused by bankers to justify high margin. Nevertheless, it is clear that the sector has seen striking product proliferation in the past few years - and most bankers say it offers fertile territory for innovation in the future.

There are several reasons for this. One is that many of the natural users of Islamic finance are now becoming markedly more sophisticated in their financial demands. Middle Eastern issuers are now increasingly embracing the concept of using the capital markets, alongside bank loans. Islamic banks in the region - and elsewhere in the Muslim world - are also becoming more aware of the benefits of diversifying the risk on their own balance sheet.
More adventurous

And the investor base of the Islamic finance world has become slightly more adventurous, too: investors are turning to hedge funds and more complex capital markets products.
This has prompted Islamic finance to move increasingly into the capital markets arena, and embrace a host of new liquidity management tools as well as more structured products. It has also fostered the creation of new institutions, such as Islamic hedge funds, with a clutch of these springing up in London and the US recently.

Moreover, as this trend has got under way, it has been greatly boosted by the arrival of Western investment banking groups into the field. Thus, behind the scenes, a bitter competitive struggle has broken out between the banks, as they each rush to transfer these innovative ideas to Islamic finance - often in conditions of great secrecy.

The most visible sign of this innovation is seen in the world of sukuk: although these instruments, akin to bonds, were invented less than a decade ago, their issuance has risen sharply and are now producing numerous permutations. Retail products, such as Islamic mortgages, have also produced rich territory for innovation.

Meanwhile, Oliver Wyman, the consultancy, believes that areas such as Islamic credit cards, or the creation of quasi-overdraft facilities (based on a concept known as tawarruq), will be the next focus for innovation in retail products. Less obviously, experimental ideas are now also emerging in product and infrastructure finance, aside from sukuk. Private equity is attracting intense interest too, as is the so-called diminishing musharaka structure, which produces an effect akin to the amortisation of a loan.

However, the field that is arguably attracting most brainpower of all is derivatives and structured finance. Until now, the use of such instruments has been extremely low in the Islamic world, meaning that most banks, investors and corporate issuers had little way of protecting themselves from items such as inflation risk.

Now, hower, investment bankers are scrambling to do precisely this - in a Sharia-compliant way. "Interesting products include profit rate swaps, which help banks hedge their foreign exchange and interest rate position," says Alexander Lis of Oliver Wyman.

This endeavour has provoked unease in some quarters. Some observers suspect that the industry should focus on developing existing products more deeply - and create a more mature, robust infrastructure - before it embraces too many new ideas.

"There is... some question as to how much product innovation is actually needed at the moment, given that the industry is relatively young and that many of its products are still nascent," points out KPMG, the consultancy, in a recent report on Islamic finance. "Some practitioners stress that the market is as much in need of consolidation and refinement as it is of innovation and new products."
Moreover, a few devout Muslims argue that these innovations increasingly contravene the spirit of Islamic finance - even if they might match its letter. Concepts such as derivatives and hedge funds, for example, are considered particularly controversial, given the Quran's ban on gharar (speculation).

"The theme of innovation brings to the surface a constant underlying debate in the industry," says Dawood Ahmedji, of Deloitte consultants. "Critics of the industry claim that innovation to date has been a case of 'Sharia Synthetics' - that is, creating compliant copycat products, with hedge funds being the latest development of this kind. Others cite the need to have conventional equivalent tools available for the Islamic customers, who have been underserved to date."
Nevertheless, these criticisms are certainly not hampering the development of new ideas at present; on the contrary most observers think that product proliferation will only intensify this year.

And as this occurs, it is a sure bet that the word "innovation" will remain on the Islamic bankers' lips. "The market is not mature," says Lis. "There is plenty of room for product innovation and improvement."
Any source

Sunday, June 3, 2007

The G8 & Third World Development

The Sunday Times (3 June 2007) reports of demonstrations in London and Rostock, just before the 2007 G8 summit, about its failure to keep its 2005 promises on world poverty. But how successful will the plans be even if carried out fully? What all such plans for aid should be aiming for ultimately is to help the assisted nations to become self-supporting through their own development. For this to become a reality a huge infrastructure cost is needed for features like roads, docks, airports which facilitate the citizens to run their businesses.

The book The Free Lunch – Fairness with Freedom reminds that every such improvement raises the value of land nearby. It also shows that the most efficient and fairest way to fund these public investments is to charge all land owners an annual tax or levy on their land's value. This is known as land value tax or location benefit levy. Such a tax is relatively simple to raise and impossible to avoid, which should make it especially attractive to less developed countries which have no history of complex state bureaucracy such as we have in the more developed world.

The book suggests that a priority for aid should be for help in setting up land registration schemes.There is expertise available from the UK through on land registration and in Australia for this and also in raising land value tax (click on Land Tax Brochure) where the taxing of land has been used for many decades.

Visit to buy the book with PayPal.Any source

Is there hope in France?

Christine Lagarde

After Nicholas Sarkozy appeared to indicate that it was 'business as usual' in French agricultural policy, the appointment of Christine Lagarde as farm minister gives a ray of hope. Named as the 30th most powerful woman in the world by Forbes in 2006, she was formerly trade minister.

She was formerly chief of a big American law firm. Although she has been careful to say that agriculture would continue to have a 'strategic' role, Ms Lagarde also said that France could continue its position of 'intransigence' for ever.

Perhaps she can use her skills as a synchronised swimming champion to move the debate on CAP forward.Any source

Friday, June 1, 2007

Financial Conference Held in BVI by OCTA

The Overseas Countries and Territories Association financial services conference took place on May 21-22 in the British Virgin Islands. It was described by BVI Chief Minister Dr Orlando Smith as a tangible demonstration of the benefits OCTA members could gain from working together. The conference received financial support from the European Commission.

Opening ceremony took place at Long Bay Hotel, first remarks were delivered by BVI Governor David Pearey, Chief Minister Orlando Smith and president of OCTA Clive Stanbrook. Orlando Smith stated that co-operation is the main idea for the conference, and added some information about the benefits to be gained from the conference. The main advantage was defined by him as helping the Overseas Countries and Territories to analyse both the opportunities and threats that can arise in the developing global economy.

Governor David Pearey in his speech specifically emphasized the achievements made by the British Virgin Islands during the last 25 years of its involvement in offshore industry, and its development in one of the most regarded OFCs. Clive Stanbrook credited the BVI for its initiatives in developing the local financial services sector.

The presenters were drawn from the International Monetary Fund, the Caribbean Financial Action Task Force, the Netherlands Central Bank, the University of Sydney, the Bank of England, the Eastern Caribbean Central Bank, the BVI Financial Services Commission and others. They represented such jurisdictions as Anguilla, Aruba, Bermuda, the Cayman Islands, French Polynesia, Greenland, the Isle of Man, Montserrat, the Netherlands Antilles and the Turks and Caicos Islands among other OCTA members.

Making statements before the conference, Chief Minister Orlando Smith named the main issues to be covered, including the role and impact of International Finance Centers in the global economy, IFCs as an ongoing development tool, the role of the private sector and the role of supranational organizations such as the Organization for Economic Cooperation and Development and the Financial Action Task Force.

About 50 delegates on the financial services conference represented regional and international agencies. The BVI International Affairs Secretariat director Lorna Smith said "As a mature financial services jurisdiction, it is very important for the BVI to host this conference and continue the dialogue about the importance of the financial services, transparency and sound regulations."
Article any source