News
BILA Committee member and Law Society Council member, Maria Memoli, has been elected to the prestigious Management Board of the Law Society of England and Wales. Not only is she the first Italian national to be on the Law Society Council, but she is also the first Italian national to have been elected to this position. The Board is a senior committee of the Society with members including Law Society President, Lucy Scott-Moncrieff, Vice-President, Nick Fluck, and the Society’s Chief Executive.
Maria has been a Law Society Council member since 2005. Amongst her many roles, she has also been a member of the Law Society’s Gazette Editorial Board, on the Membership board for 3 years and was the Chairman of the Council Members’ Conduct Committee for 4 years.
Promising in her election statement not only to ‘talk the talk’ but also to ‘walk the talk’, Maria says that her background and experience equip her to deal with a range of thorny issues including ‘business planning, governance, VFM, budgets, HR, financial controls and risk management to name but a few’.
Rocco Franco, President of BILA said that:
‘BILA is delighted that Law Society Council members have recognised Maria’s talents and personal qualities in this way. As an active BILA Committee member, Maria has strived to put Italian lawyers on the Law Society’s radar by inviting Law Society office holders to seminars in Italy to such cities as Rome, Venice, Padua and Genoa. Maria’s prestigious appointment is particularly welcome at a time of change for the legal profession across England and Wales, which is of much interest in Italy and may impact on the rest of the world”
Maria Memoli said that:
“I am absolutely thrilled to have been elected onto the Law Society’s Management Board and I am humbled by my fellow Council Members’ confidence in me. It certainly won’t be an easy ride running the Law Society, but to have an Italian flavour at the higher echelons of the Law Society is quite something – definitely a first !”.
28 November 2012
That Swiss Account …
On 6 October 2011 the UK Swiss Tax Agreement on Co-operation in Tax Matters (‘the UK Swiss Agreement’) was signed, and it is expected to come into force on 1st January 2013 (subject to the national legislation being in place in both countries before then). It will have important implications for those who are within the UK tax net and have, directly or indirectly, a beneficial interest in financial assets or bank accounts in Switzerland. Unless appropriate advice and action is taken those affected could be in for a nasty shock.
The Background
In recent times, UK taxpayers with offshore assets that have not been properly declared in their tax returns have been able to take advantage of offshore disclosure facilities made available by HMRC (‘the Revenue’). The origin of the foreign assets may be earnings from a business that have been squirreled away without being declared, or an inheritance from a kind aunt. The taxpayer has placed the funds in an offshore bank account or portfolio because they either do not know what to do about the situation or have chosen to do nothing. The offshore disclosure facilities offered the taxpayer the incentives of allowing these problems to be tidied up with the Revenue and only reduced penalties being charged. Given that there are possible criminal sanctions for evading tax, and penalties can now reach a maximum of 200% of the unpaid tax, a lot of people have taken advantage of these facilities. The Revenue, on the other hand, welcomed the collection of tax for past events and the fact that tax will be paid in the future on these assets as well.
The UK Swiss Agreement, however, seeks to attack the problem of those UK taxpayers with financial assets or bank accounts in Switzerland who have so far not made a disclosure to the Revenue. From next year such taxpayers will be faced with some decisions to make. Broadly there are two decisions, and for each decision there are two options. The first decision concerns how to regularise the position to date (‘the one-off payment’), and the second concerns how to regularise the on-going position (‘the lifetime withholding tax’).
UK Resident and Domiciled
For those who are UK resident and domiciled, for each decision there will only be the options of:
1) maintaining anonymity but paying away part of the capital of the assets or income/gains as they arise (the payments being made to the Revenue via the asset holder (e.g. bank) and Swiss authorities); or,
2) allowing a disclosure to be made to the Revenue.
As regards regularising the position to date, if the first option is selected then a one-off payment of the capital value of the assets is taken by the asset holder. The value of the payment is calculated according to a formula and will be between 21% and 41% of the total capital value (calculated according to provisions in the UK Swiss Agreement). This payment will in most cases clear all liability for income tax, capital gains tax, inheritance tax and VAT, and associated interest and penalties.
For the on-going position the taxpayer will need to decide whether anonymity is to be preserved and a lifetime withholding tax is paid on the income and gains of the assets as they arise, or alternatively if disclosure is to be made. The rates for the withholding tax are in line with, but slightly less than, the top rates of UK tax as they are collected as they arise and so earlier than on a self assessment basis (40% on dividend income, 48% on other income and 27% on capital gains).
The one-off payment and lifetime withholding tax are unlikely to be the correct rates of tax to apply to the particular assets, income or gains, and so disclosure will often be the better option for UK resident and domiciled taxpayers.
If no option is selected by 31 May 2013 as regards the one-off payment then anonymity will be preserved and the tax payment will automatically be taken by the asset holder. Similarly, the lifetime withholding tax will commence once the agreement comes into force (1 January 2013) unless the option to disclose is chosen.
UK Resident and Non-UK Domiciled
Those who are not domiciled within the UK but are resident here have additional options as regards the one-off payment. As they can also opt out of it, or apply it only to income and gains with a UK source or those that are remitted to the UK. There will be no or only limited clearance of past tax liabilities if these options are chosen. The lifetime withholding tax also only applies to income and gains with a UK source or those that are remitted to the UK. The taxpayer will need to supply the asset holder with a certificate as to their domicile supplied by a lawyer, accountant or tax adviser in order to select this option.
Withholding Tax on Death
There is also provision for a withholding tax (at 40%) to apply when the UK taxpayer dies, but this is only in the case of UK resident and domiciled taxpayers. Again, there is the option of disclosing the relevant details to the Revenue to avoid a withholding tax being taken.
Liechtenstein Disclosure Facility (‘LDF’)
Thankfully, for those who own Swiss assets but have not paid the correct amount of tax, there is a disclosure facility currently open with the Revenue. The LDF allows those with offshore undisclosed assets to establish a link with Liechtenstein (if one did not exist already), disclose their position to the Revenue and benefit from the Revenue looking no further back than 1999, much reduced penalty rates and also removing the threat of criminal prosecution for tax evasion (which the UK Swiss Agreement does not). If the taxpayer acts quickly enough, their tax position can be regularised in a cost efficient manner and the UK Swiss Agreement need not cause such concern.
Andrew Godfrey
Penningtons Solicitors LLP, Abacus House, 33 Gutter Lane, London EC2V 8AR
Andrew.godfrey@penningtons.co.uk
Tel: +44 (0)20 7457 3074
This article is a summary of recent developments and, whilst every care has been taken to ensure the accuracy of the information provided, it should not be regarded as a substitute for advice in any particular case. Every case is different and you must not act solely on the basis of information contained here. BILA and the article’s author make no warranties as to the accuracy of the information contained in the article and are not responsible for the content of external websites. Where opinions have been expressed, they are the personal opinions of the author and do not constitute professional advice on any level, nor do they represent the opinions of BILA.
Recently this year, Mr Justice Teare authorised a claimant to serve a claim to a defendant via Facebook for the first time in the High Court.
Australia and New Zealand –both Commonwealth countries with similar legal systems – are well ahead, having allowed service of legal documents by Facebook and Twitter since 2008. However change has been in the air in England for some time, as a similar ruling was made at the County Court in October 2009 whereby permission was granted to serve an injunction via Twitter.
The case is a commercial case and involves a £1.3 million claim by two investment managers against their broker and two of its employees. The broker denied responsibility and argued that in case it was held liable, it was entitled to recover a contribution from the two individuals, however no one was sure of the current address of one of the employees, a Mr Fabio De Biase.
The circumstances of this case were very specific: the defendant was a former employee of the claimant and some of his former colleagues were still working for the claimant and were in contact with the defendant via Facebook. They were therefore able to identify him from his photo and also establish that the account was being used as he had recently accepted some of their requests of friendship. The judge was therefore convinced that it was impossible to have his identity mistaken for someone else with the same name.
The Civil Procedure Rules deal with service of claim forms and other documents in the jurisdiction (England and Wales), in the UK and within the EEA.
There are two underlying principles which are encompassed in all the rules on service: (1) correct dispatch of the claim within its validity period and (2) effective service, so that the court has jurisdiction over the dispute. The general aim of the provisions on service is that insofar as possible documents have to actually come to the attention of the party being served.
Service is defined in the glossary to the CPR as “steps required by rules of court to bring documents used in court proceedings to a person’s attention”.
CPR 6.3(1) provides that a claim form may be served on an individual by any of the following methods:
- Personal service in accordance with rule 6.5 (i.e. giving the documents directly to the party)
- First class post- dx- or other service which provides for delivery on the next business day
- Leave in a specified place as per CPR 6.7, 6.8, 6.9 (or 6.10 in respect of Crown proceedings). In brief those places are: at the defendant’s lawyer, at an address that the defendant has provided or at a default address. The default address will only come into play where personal service is not required under CPR 6.5, and the defendant has no legal personal representative and has not otherwise provided an address.
- Fax or other electronic means of communication. The key point to note here is that consent to service by this method is required, which can be given either impliedly or expressly. In particular for service via email Practice Direction 6A requires that the party served should always be asked if there are limitations to the format in which documents can be received and the maximum size of attachments. The claimant should always tag the email so to obtain an electronic receipt confirming that the email has been both delivered and read.
- Any method authorised by the court
The place of service will ordinarily be the usual or last known residence of the individual. The claimant must take reasonable steps to ascertain the defendant’s current address or place of business and if unable to do so the claimant must consider whether there is an alternative place or method by which service may be effected. He then must seek an order for alternative service of the claim and this is where the new case establishes a new era for the service of claim forms.
There are no details on how service was then practically effected using Facebook, but it was almost certainly carried out by way of a private message with the documents attached by PDF sent by the solicitors of the claimant. However, at the time of writing Mr De Biase has not yet participated in the proceedings.
What is important here is that the courts recognised the increasing power of social networking sites like Facebook. This is clearly another example of the English case law system being by nature a flexible means in the hands of the judges which allows them to adapt rules of law, which are sometimes old and obsolete, to modern life and modify legal procedure taking into account changes of society.
Rocco Franco
Partner at Pini Franco LLP
This article is a summary of recent developments and, whilst every care has been taken to ensure the accuracy of the information provided, it should not be regarded as a substitute for advice in any particular case. Every case is different and you must not act solely on the basis of information contained here. BILA and the article’s author make no warranties as to the accuracy of the information contained in the article and are not responsible for the content of external websites. Where opinions have been expressed, they are the personal opinions of the author and do not constitute professional advice on any level, nor do they represent the opinions of BILA.
The SRA Handbook 2011 was launched by the Solicitors Regulation Authority (‘SRA’) on 6 October 2011. The handbook governs every aspect of solicitors’ practice and accommodates new legislation relating to alternative business structures (ABSs).
Within the Handbook is the updated SRA Code of Conduct 2011 (replacing that of 2007). The most substantial change to the Code is a shift of focus from a rule based system to ‘Outcomes Focused Regulation’, which “concentrates on providing positive outcomes which when achieved will benefit and protect clients and the public”.
In practice, this means that whether or not a breach results in disciplinary action relies on the outcome to the client and impact on the service received by the client. The position under the 2007 Code was that if a rule were breached, disciplinary action would follow automatically.
The prevailing view among practitioners is that the changes substantially alter the way firms will work on a day to day basis.
