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EDITORIAL MISCELLANY

A HARMFUL DELAY

A curious coyness envelopes the awkwardly titled Finance 1998 (Jersey) Law 2001 which received royal sanction on February 14th, 2001, no less than three years after being adopted by the States in January 1998. Very little has been said officially about the extraordinary delay in granting royal sanction to a law which, inter alia, authorized the collection of the bulk of the Island’s revenue during 1998. We have been told that the institution of legal proceedings against the Home Secretary was in contemplation. The detail of the discussions or arguments which have taken place has not been disclosed. What is certain, however, is that relations between the UK Government and the government of Jersey became more strained that at any time in recent memory. It is no secret that the UK Treasury took exception to the so-called “designer rate” tax devised for international business companies following the government’s commitment to the OECD’s Harmful Tax Competition policy about which Colin Powell writes in this issue.[1]

The chronology is worth underlining. The draft law was adopted by the States on January 20th, 1998. The draft law authorized the levying of income tax for 1998 and made various other routine amendments to fiscal laws. Ordinarily, one might have expected the sanction of the Privy Council to have been granted in April or May. But at its April 1998 ministerial meeting the OECD agreed upon a series of recommendations to counter the spread of tax havens and harmful preferential tax regimes.[2] These recommendations were accepted by the UK government in June 1998. Recommendation 17 of the OECD’s report provided that countries with dependencies which are tax havens should ensure that harmful tax competition was not promoted nor increased. Ignoring for the present the argument as to whether Jersey should properly be classified as a tax haven, one can understand however the political embarrassment felt by the UK government at being seen to endorse a law containing a provision which on any view must be regarded as falling within the description of “harmful tax competition”. But does political embarrassment justify a refusal to submit for sanction by the Privy Council a fiscal measure adopted by the elected representatives of a Crown dependency? The question throws into sharp relief the different functions of the Home Secretary first as Privy Councillor responsible for the affairs of Jersey and secondly as a member of the cabinet.

A number of points may be made drawing on the limited information now in the public domain. First, the commitment giving rise to the political embarrassment was made by the UK government without consultation with the States and in the knowledge of the legislative measure announced in the budget in December 1997 and lawfully adopted in January 1998. Secondly, the commitment was given against the background of settled constitutional arrangements pursuant to which the States determine the Island’s fiscal policy. Thirdly, equivalent fiscal measures were already in force in Guernsey and the Isle of Man. Fourthly, the UK government had already acted to protect its own domestic fiscal interests by enacting the Controlled Foreign Companies (Designer Rate Tax Provision) Regulations 2000, SI No. 3158. Even if, as the Kilbrandon Commission suggested in 1973[3], the UK could properly withhold assent to a law adopted by a democratically elected legislature on the basis of its own domestic interests, the enactment of these regulations destroyed any defence on this ground. Fifthly, those regulations acknowledged that the Finance (Jersey) Law 1998 had come into force, pursuant to an acte opératoire adopted by the States on January 20th, 1998[4].

Even on the basis of the views expressed by the Royal Commission on the constitution in 1973, there was plainly no power to refuse to submit the law for Privy Council sanction. Political embarrassment is no justification for a failure to act in accordance with a legal duty. It seems surprising therefore, and unfortunate, that this period of confrontation should have continued so long and that any question of resort to legal proceedings by the States should have arisen. The traditional approach to the constitutional relationship between the Channel Islands and the United Kingdom, examined elsewhere in this issue[5], may now need more critical and dispassionate legal analysis than it has so far received.

WHERE HAVE ALL THE SPARROWS GONE?

The sparrow has long been undervalued. Even St. Matthew taught-

“Are not two sparrows sold for a farthing? …….. Fear ye not therefore, ye are of more value than many sparrows”.[6]

When the Protection of Birds (Jersey) Law 1963 came into force the house sparrow was treated in the same way as the carrion crow and even that avian terrorist, the magpie. None of them was protected. No matter that nearly all wild birds enjoyed the protection of the law, and could not be shot nor taken, the sparrow was excluded[7]. When the 1963 Law was substantially repealed and its controls replaced by provisions of the Conservation of Wildlife (Jersey) Law 2000, the sparrow’s position remained unchanged.

Today their garrulous twittering and chirping are hardly heard. Whether it is intensive farming, or a growth in the number of magpies, or from some other cause, the number of house sparrows has dwindled alarmingly. Happily the Planning and Environment Committee has acted to confer protected status for these friendly birds which seldom nest more than half a mile away from human habitation. When the Conservation of Wildlife (Amendment) (Jersey) Order 2001, came into force on May 1st, 2001, the house sparrow (passer domesticus, as this is a legal periodical) became safe from lawful human aggression.

JERSEY LEGAL INFORMATION BOARD

The Jersey Legal Information Board (JLIB) has recently launched its second generation website with a new URL (jerseylegalinfo.je). It will be of interest to subscribers to note that the editorial board of this Review has agreed to publish past issues of the Jersey Law Review on the JLIB website. There is a cumulative index but not, as yet, a search facility.

[1] See page 161

[2] Report presented to ministers of the OECD countries at their Council meeting on April 27th/28th 1998.

[3] Report of the Royal Commission on the Constitution, 1969 – 1973, HMSO

[4] The Public Finances (Jersey) Law 1967 empowers the States to make provision by acte opératoire for tax legislation to take immediate effect pending sanction by Her Majesty in Council

[5] See page 123

[6] St. Matthew – Chapter 10, v. 29

[7] The Schedule to the Law listed six birds which were not protected – carrion crow, house sparrow, jay, magpie, starling and wood pigeon