Will Gibraltar, the 300-year-old U.K. territory near the southern tip of Spain, become the next hedge fund capital?
Bloomberg reported that Gibraltar’s low tax rates and regulations have quadrupled the region’s hedge funds to least 200 in 2012 from four years prior.
The article said that the region attracted a slew of traders and fund managers after introducing a regulatory regime in 2005, which allows funds to be approved quicker than London. Another incentive is that businesses in Gibraltar are generally taxed at 10% of profits, compared with a corporate tax rate of 23% in London.
Most of Gibraltar’s funds are run by traders who previously worked at investment banks in London and Zurich.
Gibraltar’s schooling in English, as well as the region’s sunny climate adds to the appeal of the territory by financial professionals.