Racing for a place in the sun

With offshore jurisdictions increasingly eager to secure India-related business, law firms from the English Channel to the Caribbean are ramping up their India practices

George W Russell reports from Grand Cayman

Once technically extinct, the blue iguana, a reptile native to the Cayman Islands, has been staging quite a comeback thanks to intensive conservation efforts. The shy lizards – 570 strong at the last count in September – barely outnumber another once-endangered Cayman icon, the offshore law firm. The lawyers may also be on the verge of a renaissance, and they should be grateful to India for a significant part of their revival.

After a gloomy year in which the Caymans’ legal industry was battered by multiple economic hurricanes – the global downturn, rising costs and government pressure to localize expatriate staff – the mood among lawyers in colourful local nightspots like Guy Harvey’s Island Grill has been upbeat of late. In August, the Cayman Islands was taken off the Organisation for Economic Co-operation and Development’s list of uncooperative tax havens after it signed its 12th tax information exchange agreement (TIEA) – with New Zealand – in Washington.

The move means Cayman has complied with strict international tax transparency standards, and could mark a turning point. The tax-transparency impasse had become dispiriting, according to many observers. “I have heard anecdotal evidence that Cayman law firms [lost] 30-50% of new deals [before the white-listing],” says Anthony Travers, chairman of the Cayman Islands Stock Exchange and president of the Cayman Islands Financial Services Association.