B2B-Mag-Vol8no3 April 2011 by Chamber of Commerce Gibraltar

Volume 8 Nยบ 3

Tax case goes our way 50,000 more seats for Gib this summer A Power Station for the 21 century The Blades come to Gibraltar The Quarterly Magazine of the Chamber of Commerce

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Foreword

Chamber Comment

The first three months of the year have sped by, and a great deal has been happening. We entered the New Year with a “ground breaking” new 10% corporate tax rate for all businesses; a level playing field for Gibraltar. This offers great financial benefit to local businesses who have in the past been paying a 22% rate and who will now pay just 10%. Our new proposition is competitive in the European market place, and should give Gibraltar an edge. Thankfully there has been no sign of an “exodus” in the on-line gaming sector, which we have built up so successfully, and there is more interest than ever from new corporate and private entities alike.

New developments We now need to address our ability to take advantage of this new business; providing new purpose built and modern office accommodation is crucial. The World Trade Centre, is said to be gaining speed with a successful launch at MIPIM, and with outline planning in place, building is said to be starting “soon”. Although Government figures show declining hotel occupancy, there seems to be no shortage of guests at town centre locations, with some weekdays being fully booked. Being able to add another key “piece” to the Gibraltar jigsaw is vital, it is therefore pleasing to hear that both the

Lester Hotel project and the Hilton Hotel and office project are both progressing. The new airport terminal is rapidly taking shape, and looking all the more impressive. Having gained a new easyJet route from Liverpool, Paul Simmons, easyJet’s regional head told B2B “I really believe that the new terminal will be a great help to our operations and aviation in Gibraltar”. There are also rumours abounding, that new carriers, using smaller more efficient aircraft, are looking at the viability of the Madrid route again. This service if timetabled correctly could be pivotal to Gibraltar, and would enable us to expand our market. The Devil’s Tower Road redevelopment is now beginning to take impressive shape and, together with the new car parks and tunnel, should go a long way to improving the traffic infrastructure.

Power Thankfully we have suffered few power cuts since the arrival of the temporary generators, and Government must be commended on the commitment to build a new power station; no mean feat in this tough financial climate. But one still wonders about the merits of the huge costs, when there is a European grid on our doorstep.

Housing The initial two blocks of new rental housing at Mid Harbours, the first to be built since

the seventies, have been delivered. This development is also an attractive addition to skyline and adds an extra 500 new flats to our housing stock, which is welcome,

Election 2011 will also bring a General Election to Gibraltar – the popular bet is on October , and as a result all Chamber members are encouraged to submit ideas for a “manifesto wish list” which they would like the Board to put forward to the various political parties.

Christmas Looking a little further forward, the Chamber would like the Christmas decorations and lights to be enhanced, not only in Main Street but also throughout Gibraltar in order to create a better festive feel for the Christmas season. In this, the most important time of the retail year, there is a need to create an atmosphere comparative to other main European cities not only with lights, but also with a festive programme in which the whole community can participate. For this to be organized properly, the planning needs to start now by Government and cultural organisations.

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Contents

In this issue FOREWORD page 3

page 3

NEWS FEATURES

PUBLISHER Copywrite Publishing

page 7

page 10

page 13

Jeremy Nicholls

page 15

editor@b2bgibraltar.com

MANAGING EDITOR

ADVERTISING

CHAMBER NEWS page 17

page 17

Jane Pizarro sales@b2bgibraltar.com

PRODUCTION David Slater

BUSINESS BRIEFS page 19

page 20

page 21

page 22

page 23

page 25

page 26

page 27

page 28

page 29

production@b2bgibraltar.com

DESIGN Copywrite Advertising design@b2bgibraltar.com

b2bgibraltar.com 9, Cooperage Lane PO Box 935, Gibraltar Tel: 200 41700, Fax: 200 77649 Gibraltar Chamber of Commerce PO Box 29, Watergate House Casemates, Gibraltar Edward Macquisten Chief Executive

PEOPLE ON THE MOVE

Tel: 200 78376

page 31

Fax: 200 78403

page 31

info@gibraltarchamberofcommerce.com

page 33

page 34

B2B is published by Copywrite Publishing for the Gibraltar Chamber of Commerce four times per annum. No part of this publication may be reproduced without the permission of the Gibraltar Chamber of Commerce or the publishers.

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News Features

Tax: Court advises in our favour

The Government

The Advocate General of the European Court of Justice [ECJ], Niils Jääskinen, has advised the court that it should uphold an earlier ruling which found that Gibraltar’s tax regime did not breach EU rules on state aid. The opinion by the Advocate General is not binding but the court’s final rulings generally reflect the advice. Europe’s Court of First Instance had already ruled in Gibraltar’s favour on the crucial issues of regional and material selectivity. One key question was whether Gibraltar could maintain its independence as a jurisdiction with the ability to set its own taxation rates. The rulings were appealed by the European Commission and the Spanish Government and this is the case that is currently before the ECJ, and on which the Advocate General is advising. His opinion supports Gibraltar’s position on the issues of both material and regional selectivity. The latest development means that Gibraltar continues to edge closer to a final resolution that will lift any lingering doubts about the viability of its new taxation regime.

The new tax framework is seen as vital to the economy and a key element of Gibraltar’s current and future success as an international finance centre within the EU. An adverse judgement could have crippling consequences for the Rock.

thus remains conﬁdent of the ﬁnal outcome

in a bid to cut its tax bill. Its Betting Exchange is now operating under a Gibraltar licence.

The company is following in the footsteps of rivals Gibraltar’s favour. Ladbrokes and William Hill, both of which have announced millions of pounds in cost savings since their departure from the UK two years ago. “The Government has throughout asserted its confidence in the legality under EU law of Betfair said its operational costs would rise in everything that it has proposed and done, the short term due to running both new and and this has previously been confirmed by existing data centres, but that this would the lower court and now by the Advocate reduce as its systems consolidation General in the higher appeal court,” the programme is finalised at the end of next year. Gibraltar Government told B2B. It would then see significant tax savings of “The Government thus remains confident as much as £20m a year and £10m of of the final outcome of the appeal in underlying earnings. Gibraltar’s favour.” “As a global, technology-led betting Gibraltar continues to attract new and operator, our new operational base in Ireland significant business, largely on the back and the change to our licensing structure of its new tax regime. provides us with increased flexibility,” said Betfair chief executive David Yu. Among the newest entrants is Betfair, which describes itself as “the world’s “It allows us to locate key technical largest betting community”. equipment in more efficient locations, to serve our customers better and to compete In March, the company said it would move on the same basis as the majority of part its operations from the UK to Gibraltar operators in the UK online betting market.

of the appeal in

News Features

New power station announced

A string of power cuts earlier this year laid bare the strain that Gibraltar’s outdated power generation network is under, focusing attention on the need for a long-term solution to the crucial issue of electricity supply. The cuts drew accusations of bad planning, although the Gibraltar Electrical Authority argued they were down to unforeseeable circumstances. Temporary generators were brought in to cover demand in the short term and avoid a similar situation, but the question of long term supply remained. That long-term solution, in the form of a new power station, is finally becoming reality after two years of delay arising from technical and legal issues. In March, the Gibraltar Government announced that it had awarded a £122.8m contract for the construction of a diesel power station and related distribution infrastructure. It is the largest single contract ever awarded by the Gibraltar Government. Once complete, the new power station will replace Gibraltar’s three existing facilities and ensure sustainable power supply for decades to come. Getting here has been a tortuous process that started in 2007 and involved major technical work to assess the site and properly evaluate the scheme’s environmental impact. It was further complicated by a legal challenge by nearby residents concerned about noise, a case that was settled out of court and resulted in further design tweaks. Chief Minister Peter Caruana, in announcing the contract, made no bones about the difficulties encountered. “It has been a hugely complex process to get to this stage, but the new power station will ensure a modern and resilient electricity supply to Gibraltar well into the future in the most environmental friendly way that is practical and realistic,” he told B2B. “It represents a very large investment for our future prosperity as a community both in social and economic terms.” The contract was awarded to a joint venture between ETDE SA - major power station

contractor company subsidiary of French multi- national company Bouygues - and Dutch Civil Engineering Company Volker Stevin Construction Europe B.V. The new Power Station will initially contain eight Caterpillar Diesel Generating sets each of approximately 7.8 Mega Watts, providing a total installed capacity in 2013 of 62.4 Mega Watts. The scheme will provide room to add further engines in the future should Gibraltar’s power needs expand further. Central to the project are environmental considerations. The new power station will comply with EU regulations and use best available technology to minimise emissions and pollution.

It has been a

This includes selection of engines with high efficiency and thus minimised consumption of fossil fuel and thus production of carbon dioxide, use of low sulphur and low ash fuel to minimise levels of particulate emissions and Sulphur Dioxide, use of selective catalytic reduction equipment and engines with fuel injection and valve timing optimised to minimise Nitrogen dioxide emissions. “The use of leading equipment and best available technology makes an important statement about our commitment as a community to the environment,” Mr Caruana said.

hugely complex process to get to this stage, but the new power station will ensure a modern and resilient electricity supply to Gibraltar well into the future in the most environmental

But the fact that the new plant will rely on diesel engines is a source of concern for the ESG.

“The new power station is a critical and important step is practical for immediate environmental and and realistic. health benefits for the community,” the group said following announcement of the contract.

friendly way that

“The closure of Gibraltar’s three existing and ageing power stations will, by itself represent a major environmental gain.”

“Clearly fossil fuel reliance for Gibraltar’s’ energy needs on a long-term basis is not a position supported by the ESG.”

The Environmental Safety Group, which has long campaigned for cleaner air in Gibraltar and has been highly critical of emissions from existing plants, welcomed the announcement, if with some reservations.

“Once in place, the focus should move towards the sourcing of biofuel such as biodiesel - waste vegetable oil, or natural gas from anaerobic breakdown of sewage and domestic waste - as fuel for the new power station, with which it could operate with little or no changes to its engines depending on the biofuel used.” Other environmental campaigners were less accommodating.

Replacing Gibraltar’s three “ageing and heavily polluting” power stations – Waterport, OESCO and the Ministry of Defence facility – is, for the group, a positive step.

News Features

“If some of the other renewable things help you around the edges, then so much the better.” “If the target is to introduce renewables in Gibraltar, then it’s going to be a little bit of this, a little bit of that and a little bit of the other,” Dr Burton added. “It’s not going to be a big bang solution, with the sole exception of perhaps bio fuels.” There is, of course, another option, but one that few dare mutter openly, let alone support as a viable alternative: buying electricity from Spain. When the Chamber of Commerce explored this idea in an editorial in this magazine last year, the reaction from many sectors of Gibraltar was sharp. The widespread view was that, against the background of decades of hostility by Spain, Gibraltar needed to remain energy independent. But the high cost of the new power station, coupled to concerns about environmental sustainability, prompted the Chamber to ask the difficult question.

The Gibraltar Ornithological and Natural History Society was among those who objected to the project on a number of fronts. It was concerned, for example, that construction of the plant would have a huge adverse impact on wildlife and ecology in the south of Gibraltar, one of the last relativelyuntouched areas on the Rock. According to GONHS, the Gibraltar Government’s energy strategy “requires more vision” and focus on renewable sources of power. Construction of a new fossil fuel power station will leave a damning future legacy for Gibraltar, the group said. “It has to be assumed that once the power station is built it will be here for decades, with the environmental deterioration of the South District continuing for generations,” GONHS said in a statement last year. “And generations will regret the decision.” “Gibraltar is sealing its options and will be anchored firmly in the past at a time when fuel costs will spiral and stocks run out.”

But was there really an alternative? At a symposium late last year organized by the Gibraltar Group of Professional Engineers, international energy experts suggested that renewable sources of energy were not adequate for Gibraltar’s needs, at least at this stage. The Rock’s size meant there was insufficient space to use established sources such as wind and solar energy, while others including tidal energy were still in the early stages of development and could not be relied on to meet local demand. Dr Nigel Burton, president of the Institution of Engineering and Technology in the UK and a veteran of the energy sector, offered a sobering assessment on the scope for green energy in Gibraltar. For Dr Burton, the future lay in diesel generators powered by renewable sources of bio-diesel, a view in line with that offered by the ESG. “To my mind, you already have the way forward,” he said.

“In these days of pan European markets in energy supplies, could we not plug in to the European ‘grid’ and contract with some European Electricity Authority or Energy Company for the supply of power?” the Chamber asked in the editorial. “Is the price of ‘independence’ on energy terms worth paying, now and for many years to come, particularly in an era when cross border energy supply is a common occurrence?” As for reducing demand, there is little realistic prospect of progress here either, particularly given Gibraltar’s sustained economic growth. New business, property and infrastructure developments will translate into increased appetite for electricity. While energy efficiency measures – low consumption light bulbs and the like – will help, Dr Burton made clear at the energy symposium that genuine gains would be hard-earned in this context. Ultimately, it was down to price. “It’s only when people have to pay for things that they change their behaviour,” he told B2B.

News Features

Maritime update side, the port will radically increase the number of ships that suppliers can handle. The new nature designation strengthens environmental protection and requires government agencies to coordinate their activities in order to guarantee a holistic approach to the site’s management. The protected zone stretches from the Bay of Gibraltar, around Europa Point to the East Side and includes an area currently used as an anchorage for merchant ships.

Shipowners continue to face difficult times and weak freight markets in many trades, prompting concern in the maritime industry about a surge in the number of banks foreclosing on overdue mortgage deals. For Gibraltar though, this means good business. . The Rock is widely regarded as a leading jurisdiction for admiralty arrests, mainly because its UK-based legal system can handle cases swiftly and efficiently. Resolving ship arrests quickly helps to protect the asset – in this case a ship – and get it back to work. While a reputation as an arrest port is not something many would wish to flaunt, there is also a general recognition that arrests are a fact of life in the maritime industry. Lawyers say that resolving the legalities swiftly and with minimum fuss protects the equity in a vessel and enable a speedy return to business or, in the case of older ships, to the scrap beaches of Turkey and Asia. When the global economic downturn kicked in during 2009, the number of arrests here rose sharply, only to ease off again last year. Banks in Europe were generally showing patience with loss-making shipowner clients during periods of low rates, agreeing to interest-only payments and other moratoriums to help them through the trough in the shipping cycle. Increasingly however, banks are getting tough with some owners, encouraged in part because they can obtain healthy prices in the second hand market when seized ships are auctioned. ICAP Shipping sale and purchase broker

Nigel Hollyer, who is the broker for the Admiralty Marshall here, estimated that 14 ships had been arrested or repossessed in 2011, compared to around 14-15 for all of 2009 and 2010. “I can’t recall seeing so many ships being reported as arrested for quite a long time,” Mr Hollyer told B2B.

The plan to open up the east side is still undergoing an environmental impact assessment, which will take into account new designations that, in practice, raise the level of environmental protection in these waters. Port Minister Joe Holliday told reporters recently that the new designations did not preclude commercial activity. “It just sets a higher standard and whatever we do will have to be within the context of this new scenario,” he said.

“Really the last batch that was of mass arrests was back in the 1998-2002 period.” “Arrests are the increase but I’ve not really seen anything terribly sexy, such as the high capital ships.” “It’s mostly smaller, older ships.

Bunkering and designation Recent changes to the EU nature designation of a large swathe of Gibraltar waters are unlikely to impact on plans to open up the east side anchorage to bunkering activity.

Changes to the EU nature designation of a large swathe of Gibraltar waters are unlikely to impact on plans to open up the east side anchorage to bunkering activity.

Allowing refuelling in this area is seen by the industry as a crucial step to bolster Gibraltar’s position at a time of increased competition from nearby rival ports. Gibraltar remains the busiest port for this business in the western Mediterranean but is constrained by the limited number of anchorage slots in the Bay of Gibraltar. The biggest cap on suppliers here is physical space. By allowing refuelling on the east

In any event, only a small area of the zone where bunkering could take place is within the protected site. Environmental campaigners are concerned, however. The Gibraltar Ornithological and Natural History Society, which was closely involved in the process of preparing the scientific studies needed to raise the EU designation of the waters, made public its concern last month in the clearest of terms.

The group questioned whether the refuelling of ships was compatible with the new designation and urged the Gibraltar Government to rethink its plans. It said a detailed impact assessment was needed in order to evaluate the risk to the site’s ecology. “Only after these requirements have been met can a decision be taken as to whether or not an activity - commercial or otherwise can be allowed to occur within the protected area,” GONHS said..

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News Features

Thumbs up for The Blades visit to Gibraltar

Imagine you’re at 3000 feet, sitting in the front seat of one of the best high performance piston aircraft in the world, you give a thumbs up, and suddenly the G Force indents your cheeks as you fly into a gravity defying, 360 degree ‘loop the loop’ over Gibraltar. Well imagine no more!. The Aerobatic Airline Display Team, THE BLADES, have confirmed that they will be bringing their unique experience to Gibraltar this May, in a weekend set to deliver excitement and unique thrills to the Rock, and for a select few the ultimate in Corporate experiences. With two spectacular public air displays, the events sponsored by Barclays Wealth, Party Gaming and Ocean Village, will be held over the weekend of 21st May

2011, and will bring some of the world’s best aerobatic pilots to the Rock.

Speaking after approval for the visit was given by the Government of Gibraltar, ‘Blade 1’ Myles Garland said “As a team sponsored by RAFA, the charity dedicated to supporting serving and former RAF personnel and their families, we are really excited about As a team coming to Gibraltar due to its special sponsored by relationship with the armed forces and the RAFA, we are strong links to the UK. really excited about This event is going to kick off our sixth coming to Gibraltar display season, and we’re looking forward due to its special to bringing our little bit of excitement to the relationship with people of Gibraltar” he told B2B.

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4.2.2010 14:58:21

0 14:58:21

News Features

Airline Update - Over 50,000 extra seats this Summer

As a result of an increase in the Luton and Manchester flights by Monarch, along with easyJets’ new route from Liverpool and BA´s use of the larger Airbus 320 instead of a 319, Gibraltar will benefit from extra 50,000 available seats this summer.

Monarch Airlines has announced an increase in the number of flights it is to operate to Gibraltar this summer. From the end of May the airline will be operating a total of 16 weekly flights to the UK (11 to London Luton and five to Manchester). According to press reports the airline cited ‘soaring demand’ on the routes along with the ‘significant factor’ of the opening of the new airport terminal.

Gibraltar (GIB) Summer Flight Times from April 2011 Day

Flight No.

Airline

Arr.

From

Monday

ZB068 ZB574 BA490 EZY8903

Monarch Monarch British Airways easyJet

11.00 11.15 12.00 14.00

Luton Manchester Heathrow Gatwick

Tuesday

EZY7295 ZB068 BA490 EZY8903

easyJet Monarch British Airways easyJet

11.10 11.55 12.00 14.00

Liverpool Luton Heathrow Gatwick

Weds.

ZB574 ZB068 BA490 EZY8903

Monarch Monarch British Airways easyJet

11.00 11.00 12.00 14.00

Manchester Luton Heathrow Gatwick

Thurs.

ZB574(a) EZY7295 BA490 EZY8903 ZB062

Monarch easyJet British Airways easyJet Monarch

10.35 11.10 12.00 14.00 18.55

Manchester Liverpool Heathrow Gatwick Luton

Friday

ZB574 ZB068 BA490 EZY8903

Monarch Monarch British Airways easyJet

11.00 11.00 12.00 14.20

Manchester Luton Heathrow Gatwick

Saturday

BA490 EZY8901 EZY7297

British Airways easyJet easyJet

12.00 13.05 17.30

Heathrow Gatwick Liverpool

Sunday

EZY8901 BA490 ZB062

easyJet British Airways Monarch

11.05 12.00 18.10

Gatwick Heathrow Luton

| | | | | | | | | | | | | | | | | | | | | | | | | | |

Dep.

Flight No.

12.00 12.00 12.45 14.35

ZB069 ZB575 BA491 EZY8904

Luton Manchester Heathrow Gatwick

11.40 12.40 12.45 14.35

EZY7296 ZB069 BA491 EZY8904

Liverpool Luton Heathrow Gatwick

11.45 12.00 12.45 14.35

ZB575 ZB069 BA491 EZY8904

Manchester Luton Heathrow Gatwick

11.20 11.40 12.45 14.35 19.40

ZB575(a) EZY7296 BA491 EZY8904 ZB063

Manchester Liverpool Heathrow Gatwick Luton

11.45 12.00 12.45 14.55

ZB575 ZB069 BA491 EZY8904

Manchester Luton Heathrow Gatwick

12.45 13.40 18.00

BA491 EZY8902 EZY7298

Heathrow Gatwick Liverpool

11.40 12.45 18.55

EZY8902 BA491 ZB063

Gatwick Heathrow Luton

Operates from 14 April.

Effective 27 May, the airline is adding four additional weekly flights. The new schedule Monday

LTN-GIB LTN-GIB

ZB068 ZB062

0705-1100 1600-1955

GIB-LTN GIB-LTN

ZB069 ZB063

1200-1340 2040-2220

Tuesday

LTN-GIB

ZB068

0800-1155

GIB-LTN

ZB069

1240-1420

Weds.

LTN-GIB LTN-GIB

ZB068 ZB062

0705-1100 1520-1915

GIB-LTN GIB-LTN

ZB069 ZB063

1200-1340 2000-2140

Thurs.

LTN-GIB

ZB068

0655-1100

GIB-LTN

ZB069

1200-1340

Friday

LTN-GIB LTN-GIB

ZB068 ZB062

0830-1225 1500-1855

GIB-LTN GIB-LTN

ZB069 ZB063

1310-1450 1940-2125

Saturday

LTN-GIB

ZB068

0700-1055

GIB-LTN

ZB069

1140-1320

Sunday

LTN-GIB LTN-GIB

ZB068 ZB062

0800-1155 1415-1810

GIB-LTN GIB-LTN

ZB069 ZB063

1240-1420 1855-2040

Manchester (MAN) Monarch will also add a fourth weekly flight each Thursday with effect from 14 April. In addition, the airline is also adding a fifth flight which will operate each Sunday from 01 May.

The new schedule effective 01 May 2011 MAN-GIB

ZB574

0715-1115

GIB-MAN

ZB575

Weds.

Monday

MAN-GIB

ZB574

0700-1100

GIB-MAN

ZB575

1145-1340

Thurs.

MAN-GIB

ZB574

0635-1035

GIB-MAN

ZB575

1120-1315

Friday Sunday

1200-1355

MAN-GIB

ZB574

0700-1100

GIB-MAN

ZB575

1145-1340

MAN-GIB

ZB574

0720-1120

GIB-MAN

ZB575

1220-1415

This information is provided by Brian T Richards. atc@briantrichards.com

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News Features

International Chess Festival Success

What an amazing tournament

Close to 300 professional and amateur chess players from every corner of the world lived 10 days of intense and highly competitive chess, in this year’s Gibraltar international chess festival which again attracted a lot of really top class players. The 2011 Tradewise International Festival certainly proved a worthy precursor to the tenth edition which has already received the blessing of Judit Polgar, the best female chess player in the world, who will play in Gibraltar next year. 2011 winner, the tournament’s top seeded player GM Vassily Ivanchuk played at the top of his game. Seventh in the world, he described the Gibraltar Open as a unique chess event with a “different atmosphere and attitude to the game” urging organisers to make the field stronger so the tournament can attract more world champions. Ukranian Ivanchuck won nine out of his 10 rounds and in the final round played against Germany’s Daniel Friedman. “What an amazing tournament we have had,” commented organiser Brian Callaghan at the prize

giving ceremony at the we have end of the 10 days in the presence Gibraltar’s Minister for Sport Edwin Reyes, sponsors and players. The tournament also received visits from Gibraltar’s Governor Sir Adrian Johns, Deputy Chief Minister Joe Holliday and the Mayor Tony Lombard accompanied by Miss Gibraltar Larissa Dali. On the final day Mr Callaghan spoke of the impressive field of play which had been lead by Ivanchuck, and the other top names: Fabiano Caruana, Michael Adams, Paco Vallejo and Nigel Short who finished a close second. The women’s top prize went to Nana Dzagnidze, and the second to Melia Salome, both from Georgia. Mr Callaghan made special mention of the 35 women players

had.

who had supported the tournament, and re-affirmed organisers and sponsors would continue to give special support to the women’s game. “I believe they contribute enormously to our tournament, and help to make this the foremost tournament in the world, and very few people would disagree with that,” he told B2B. Closing the ceremony President of the English Chess Federation, CJ De Mooi, was well impressed with festival: “It is an incredible tournament, venue and place. I did not understand why people kept coming back year after year, now I do it is simple to explain, it is the warmth, generosity and genuine friendliness, which surrounds the tournament.” James Humphreys, chairman of the main sponsor of the tournament Tradewise Insurance, said the comments in the press around the world on the tournament continued to “heap great praise on what has been accomplished for chess” over the years in Gibraltar. He assured that for next year the level of prize money would be higher than in any previous tournament. Now as emphasis shifts to 2012 already work has begun to make it the best international chess festival yet. .

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Chamber News

Chamber co-ordinates user training for the new ASYCUDA customs clearing system

The Chamber has been working with HM Customs to organise a programme of training courses to familiarise members with using the new ASYCUDA customs clearing system. Last year B2B informed members that the new system was due to be implemented and would be organising a series of training seminars. The new system is due to go live in the next few months but it cannot run in parallel with the existing computer system which is now over 20 years old. Customs clearing agents and importers have been trained at HM Customs’ dedicated training facility in Governor’s Parade so that they are fully up to speed on the new system before it goes live. During February and March over 100 members have been trained on using the new system.

will enable clearing agents and importers to submit customs declarations electronically for the first time. Duty calculations will be automatic so agents and importers will also know exactly how much duty is payable at the time of submitting their entry. This will eradicate the uncertainties which had existed previously and had led to some declarations being delayed because there was a dispute between HM Customs and the importer over the amount of duty payable. HM Customs is due to set up a training server which agents and importers can practise on in a simulated way before the new system goes live later this year. If any member has for some reason missed out on receiving training on the new system or has any questions about the new system they should

The new clearing system will be a great improvement on the one it replaces as it

contact the Chamber on 200 78376 or by email at info@gibraltarchamberofcommerce.com.

KPMG hosts Gibraltar e-gaming summit

KPMG Gibraltar hosted an e-Gaming Summit at the Leisure Business Centre in Ocean Village at the end of March. The summit brought together the sector’s major players and service providers both locally and from overseas to discuss Gibraltar’s potential in the global marketplace.. The main aims of the summit, a first for Gibraltar, were to consider and debate how Gibraltar can continue to be at the forefront

of developments in the online gaming industry worldwide. The Chief Minister, Peter Caruana, opened the one day summit which was attended by more than 150 key decision-makers from the industry and included presentations by the regulator, industry practitioners, service providers and advisers. Mike Harvey, Director for KPMG Gibraltar, told B2B at the start of the summit “that the

e-Gaming sector is expanding globally and is already a major contributor to our local economy. It is crucially important that Gibraltar continues to make itself an attractive jurisdiction for the licensing and operation of online gaming companies. This involves input from the government, key industry players and service providers in finance, IT and a variety of other key sectors. This summit will bring those key players together to discuss the needs of the industry as it grows and develops.”.

Chamber News

Chamber’s workshops show members how to proﬁt from social media

During the first quarter the Chamber ran a number of workshops for members on using social media for business. These workshops looked at using Facebook, Twitter and LinkedIn for business rather than leisure use. The workshops were led by WorkIT Gibraltar a specialist consultancy which advises companies on how they can harness social media tools to benefit their business.

Separate workshops were also held on using a number of products and services from Google, many of which are free and can greatly assist companies in monitoring their own performance as well as that of their competitors. The workshops have been very well attended by members and demand for them was high, so much so that the sessions have had been re-run as the first

and second series of workshops were sold out. Similarly, feedback from those members who attended has been very positive. Participants greatly valued the insight on how to formulate basic social media strategies as well as several useful tips on how to get the most out of these online resources. Future workshop topics will include the use of Digital Marketing Tools such as iPad and Tablets, Ebooks and Smartphones..

New ‘Walk in - Start Work’ Business Centre opens in Gibraltar

The brainchild of Richard Brooks and Barnett Fletcher (Rock Brand) – the CTS Business Exchange is open for all those people who ‘sort of work’ in Gibraltar but are often found walking the streets and bars hopping from Wi-Fi to Wi-Fi and newcomers to the Rock who are looking for somewhere to start their business. CTS – providers of all things airborne, wireless and telephony are providing the space and all the technical support, telecoms and connectivity. The offices have been fitted out to provide flexible workspace solutions including ‘hot desks’, small office units and meeting rooms available for short term rental. The offering is supported by everything from coffee to video conferencing and a friendly receptionist on hand to assist.

Barnett Fletcher told B2B, “The CTS Business Exchange has been set up to service companies like Rock Brand were 20 months ago - new to Gibraltar, in need of some help and some friendly faces and somewhere to sit down, plug in and start work whilst keeping costs to a minimum. We are probably the first offices you get to when walking from the airport or frontier and we are easy to find – it’s just what Gibraltar needs as it continues to attract new, entrepreneurial businesses. The idea is clearly a good one as six out of the seven units are already let just through word of mouth and several hot desks are being booked in advance. Workspace can be booked by the hour, day week, month or longer along with meeting rooms and mailbox services.

Start-ups and new businesses to the Rock do not know how things will develop and they cannot justify committing to a long lease from day one. The Business Exchange provides a more flexible option: professional modern offices at reasonable rates.” .

Business Briefs

When countries overtake sectors Industrials in EMU, US, UK & Japan over the past 15 years are generally quite low, with Industrials in Japan exhibiting a negative correlation with Industrials in the European Union, and the average correlation of Industrials across those regions being just 0.13. In other words, over the past 15 years, knowing that we liked Industrials (or not) was insufficient information to produce consistent out-performance if we did not know in which country to apply this preference. Although not necessarily as low, looking at the other nine major sectors also produces surprisingly low correlations between regions.

Paul Marson, Chief Investment Officer of Lombard Odier Private Banking

When investing in the equity market, investors face three fundamental choices: What sectors do I like? What stock should I buy? Which countries are most attractive? Typically, many investors view those three decisions in that very order of preference, believing that portfolio performance will come from the selection of the best individual companies in their preferred sector. However, when we look at the available empirical evidence and academic work, we find that the single most important

Paul began his professional career at the Bank of England as an Economist in the International Division. In 1995 Paul joined JP Morgan Investment Management as a Portfolio Manager and became a member of the global strategy team. After five years at JP Morgan, Paul moved to Goldman Sachs Asset Management, taking the role of

choice is that of the individual country in which you invest, rather than the sector you prefer. In short, country selection explains the largest part of performance, select a good sector in the wrong country and your stock-picking skills go to waste!

For each regional sector, we looked at the extent to which performance can be explained by excess returns from other sectors in the same region versus the explanatory power of the same sector in other regions. In the overwhelming majority of instances, we find that other sectors from the same region are better able to predict returns for a specific regional sector we ďŹ nd that than the same sector in other regions. It is clear the single that other sectors within the EMU contain much most important more information on how EMU Financials behave choice is that than Financials in the rest of the individual of the World. In other words, the country country in which selection effect is stronger than the sector selection you invest effect in isolation.

Our first observation is that returns amongst the same sector of various countries are not as highly correlated as we could expect. Correlations between excess returns over their corresponding regional benchmarks of

Executive Director and member of the Global Fixed Income Strategy Team. In 2003, he was promoted to Managing Director and Chief Investment Officer of Goldman Sachs Private Wealth Management in Europe. Paul joined Morgan Stanley Private Wealth Management in 2007 as a Managing Director, Chief Investment Officer and

Finally, across the 4 main regions, those sectors where the region/country decision dominates the sector decision (and vice-versa) in almost all cases (in every case for Japan) the country/region decision dominates. The moral of the tale is, firstly choose which countries you like and then choose the individual sectors/stocks that you prefer.

the Head of the Investment Group. He has been the Chief Investment Officer of Lombard Odier Private Banking since 2008. Paul has a First Class Bachelor in Economics from Queen Mary College, University of London and a Masters in Economics from the Sidney Sussex College, University of Cambridge.

Business Briefs

Visiting Professor appointment for partner of Hassans profile of Gibraltar as a mainstream European financial centre.” He graduated with a First Class Honours degree from Manchester Metropolitan University and was awarded a Masters degree in law with Distinction at Manchester Victoria University. A barrister-at-law, he was admitted to the Supreme Court of Gibraltar on the 17th December 1993.

Nigel Feetham has been appointed a Visiting Professor at Nottingham Law School, Nottingham Trent University, with effect from 1 March 2011 for a period of three years.. Visiting Professor is a title conferred upon persons of distinction who satisfy the criteria for appointment as a Professor. A professorship therefore recognises the merit of persons who are distinguished in their

field, normally at national or international level, evidenced by sustained high professional standing in their discipline. James Levy QC, Senior Partner at Hassans told B2B “We believe this is the first such appointment of a Gibraltarian legal practitioner to the eminent position of Visiting Professor and underpins Hassans’ commitment to the pursuit of excellence. The appointment will also help to raise the

Nigel told B2B “I am delighted with the appointment and look forward to my association with Nottingham Trent University. As the position is that of Visiting Professor, I will still continue to practice law in Gibraltar as I currently do. I am grateful to my colleagues at Hassans and clients for their overwhelming support. I owe my biggest debt of gratitude to my wife Yvonne, my children Shannon and Matthew and my late grandfather Walter Feetham.”.

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Business Briefs

10th Birthday for IBEX

Ibex celebrated its tenth year of trading in January this year and acknowledged the great service and loyalty of two members of staff who have been with the Company from day one. Liana Pincho and Caroline Gomez told B2B how they have witnessed all the changes along the way, from the early days in a small office in the Cornwall’s Centre and then to Marina Bay, initially in Neptune House and then to The Tower.

Following a party in January, Caroline and Liana were presented with gifts from the Company to mark the occasion and did not forget that it was also the tenth anniversary of Ibex Chairman and founder John Harrison who was also presented with a gift by his fellow directors.

Both Caroline and Liana have experience across the Ibex business but more recently Caroline has specialised in the underwriting of home insurance and Liana moved from Claims to be a figure well recognised by clients in the Horse Barrack Lane retail office.

Caroline Gomez

In April, Caroline and Liana will move with more than forty colleagues to the new purpose built Head Office at 66-68 Irish Town and the story will continue.

Liana Pincho

Kings Bowl Strikes the Right Note different UK hospitality backgrounds. Polly Rae has worked in various hospitality institutions in managing roles. Before leaving the UK she was managing a Latin American restaurant chain in the heart of Bristol, where she revolutionised customer service standards and training procedures for the entire company. Ann-Marie has risen through the ranks of a popular London children’s soft play centre, and most notably as F&B Manager she took the stars on the door from 0-4 within less than a year.

‘King’s Bowl has started the new year with a new Management team and resolutions that will not be broken’ recently recruited General Manager, Polly Rae Smith told B2B. Ann-Marie Fiol has also taken up the position of Assistant Manager. Both have come from

‘As a reaction to the ever increasing interest in corporate party bookings, part of the ongoing event development has been the introduction of the immensely popular cosmic bowling.’ added Polly. With state of the art Bose sound system, lasers, UV lights, high quality projectors and a modern Juke-box, it’s no surprise that this has proved to be a big attraction. Not only reserved for parties, Cosmic Bowling is also on Fridays and Saturday nights for the general public to enjoy. Theme days and nights are constantly being created, and all the big sports events are always being shown. Polly told B2B that ‘King’s Bowl is stamping its mark on the Gibraltarian map as the venue for Corporate Team Building events and personalised parties.’.

Business Briefs

What’s next for Small and Medium Enterprises in Gibraltar?

Paul Wharton is the Head of Corporate Banking at Barclays Wealth in Gibraltar. Paul has over 3 decades of experience in various roles within Barclays, predominantly in and around the London area and is passionate about supporting the Small and Medium Enterprises (SME’s) market as he sees this as the life blood of Gibraltar’s economy. Over the years Paul has won awards for his work in the SME markets and has served on the London Board of the Princess Trust. Paul’s message today for all SMEs in Gibraltar is to protect themselves. “In these times of uncertainty, when markets are volatile it’s important that SMEs take every precaution to fix margins - otherwise they leave themselves exposed. We are all aware of the economic factors we can’t protect against, such as labour, inflation and government policy. However, we can protect businesses against the movements of currency exchange rates, interest rates and commodity prices; these solutions are available in Gibraltar.”

Paul points out that one of the most popular ways of covering short term foreign exchange risk is to take out a ‘forward contract’. The ‘forward contract’ ensures that a rate is agreed at the time the contract is agreed for a delivery date in the future, effectively protecting against adverse fluctuations that could impinge on the profitability of an otherwise successful future transaction. Paul, together with his team in Gibraltar is active in having these discussions with his clients in Gibraltar right now. As Paul says; “I have a team of experienced Relationship Managers that cover the entire Gibraltar market from the very important sole trader right up to some of Gibraltar’s largest

international trading companies. The key is for my Relationship Managers to fully understand their clients’ business and the industry they operate within. Barclays Wealth in Gibraltar has recently introduced the concept of their Relationship Managers becoming industry specialists. This will involve some intense training both in Gibraltar and the UK At present we have Relationship Managers specialising in the areas of Retail and Wholesale, Property, Shipping, Tourism and leisure just to name a few. Finally he added; “I want my managers to specialise within their chosen industries and really add value to the relationship that they have with their clients”.

Let’s have a look at one of these potential risks in more detail; “Any business that has a regular requirement to make international payments needs to be aware of currency fluctuations. Whether you’re an importer, an exporter or both; if the foreign exchange markets move against you, the profitability of a deal can be negatively impacted and that’s money that comes straight off the bottom line. There’s no use in pulling out all the stops to seal a deal, only to see your profit margin quickly wiped out by a disadvantageous currency swing.

Ibex Expands in Spain and Portugal

Ibex Insurance Services Limited has accelerated the growth of its retail operations in Spain and Portugal through the opening of nine new offices in the last six months.

Ibex to consolidate its presence in Almeria where Ibex already had a strong customer base and to capitalise on the potential for growth that Ibex feel exists within the expatriate community in Portugal.

In September of last year Ibex acquired the client business in Spain and Portugal of Lloyd and Whyte International Limited, a UK based insurance broker. In doing so Ibex took over the four offices and fourteen staff based in Almeria, Spain and the Algarve, Portugal. This acquisition was a good strategic fit for

During the last six months Ibex opened a further 5 offices in Spain. Three in the province of Alicante, one in Murcia and one in Mallorca. All the offices are manned by staff with many years insurance experience serving the expatriate community in Spain.

Ibex continues to work with over 200 agents and brokers in Spain and Portugal and the agency network will continue to play a vital part in the success of Ibex, a point reiterated by Managing Director, Richard Hill who told B2B ‘Our dedicated and loyal agents have been the founding stone of the Ibex success story over the past 10 years and they are an equally important part of our future. We will continue to give the same rates and service to our agents as we do to our own retail offices and we are confident they will continue to thrive.’.

Business Briefs

Protecting your most valuable assets So what is ’Business Protection’? Business Protection is essentially insurance on senior or key people in the business whose absence through serious or long-term illness or death would have a detrimental effect on profits, client relationships, business loans etc. and also on their immediate family. The financial compensation could pay for a replacement on a temporary or permanent basis and also provide the cash flow to support the business through difficult times. Take for example a sole trader. If the sole trader were to fall ill who would run the business during the illness and continue to provide the sole traders’ family income? Having Business Protection will provide the financial support to the family and may also keep the business going until the sole trader recovers or the business is sold.

Attracting and retaining ‘key people’ is paramount to a company’s success. This is particularly important in Gibraltar where there is near full employment and shortages of people with certain skills and qualifications. Well qualified and experienced people can and do choose who they want to work for. Companies, therefore, need to look at providing ‘Employee Benefit’ solutions that help companies attract and retain staff in areas such as Retirement Savings Plans, Death in Service, Group Critical Illness Cover, Relocation Packages, Flexible and tax efficient Benefits Design

How can ’Employee Benefits’ attract and retain staff? If an individual has a key skill that is in demand, that person will quite rightly chose the employer who can offer them the best remuneration package as well as the prospect of job satisfaction and security. If the remuneration package includes other benefits then potential employees are more likely to choose the package that offers a broader range of benefits that suits their needs rather than a higher salary alone. However, it is not enough just to attract the right staff - employers need to retain and prevent staff from being enticed to rival firms. Therefore, the remuneration package must remain attractive, competitive and flexible.

Investing in people this way is not just limited to senior staff but can be extended to all staff; thereby showing them that you value them all and are interested in their well-being. In return they will give the company loyalty and commitment.

Is it affordable? Affordability depends on the value that people are to the company. Investing the right amount in people will result in a return to the company in terms of productivity, loyalty and profit. Losing people can be costly in terms of investment already made; for example in recruitment and training and not getting future benefit of that investment. There are also potentially significant tax advantages to the employer and employee, though these can be complex and need expert guidance that EFPG can offer.

Business Protection Most companies will take out ’Public Liability’ Insurance, ’Property Insurance’ and insurance on it’s major assets such as machinery and may also have ‘Disaster Recovery’ plans for IT systems; but fail to put plans into place for ’People Recovery’ (Business Protection) that could have devastating consequences for the business.

Another example could be a larger company whose MD or top salesman dies or becomes seriously ill - this would have a devastating affect on profits and cash flow. Having ’Business Protection’ plans and insurance in place would minimise the impact by providing the monetary insurance for the company to find and attract another top salesman. It is vital that Partnerships also have Business Protection as the death of a partner could mean the Partnership is automatically dissolved unless stated otherwise in the partnership agreement. Business Protection can help to make sure that the control of the business remains in the hands of the surviving partner(s). This is called ’Partnership Protection’. Similar considerations apply to shareholders in a limited company. Who would inherit shares? Would they want to be involved in the business? Would they prefer the cash equivalent value of the shares. Having Business Protection also makes it more likely that business loans will be granted as many lending corporations now insist that Business Protection is in place. Business deals are also more likely to be signed as the other business will have ’peace of mind’ that business can continue if Business Protection is in place. Remember the phrase ’your greatest asset is your people’. www.efpg.net

Business Briefs

Argus continue professional development policy to encourage employees to attempt the first certificate level.’ he added. Of the 8 members who have achieved certified status within the last 12 months, 6 are now woking towards their diploma. Thomas Stagnetto has recently passed his diploma exams and Martin McKeever and Tyrone Montovio have now achieved chartered status.

2010 was a good year for Argus Insurance´s professional development programme. Ten employees have now achieved Certified, Diploma or Chartered status with the CII in UK. Tyrone Montovio told B2B that Argus’ aim is to continue to increase the number of CII qualified staff and to promote their personal development. ‘It is company

As one of the students told B2B, ‘The certificate in insurance has been a great personal achievement for me. ...It has broadened my knowledge and understanding of all general insurance not only in my own field of work which is claims’. The programme involves home study with the backing and encouragement of Argus and with the added incentive of a one off award to individuals on successful completion of each component.

Congratulations to all those who have achieved success in 2010. Thomas Stagnetto: Diploma and working towards Advanced Diploma Lorraine Povedano: Cert CII and working towards Diploma Melissa Cortes: Cert CII and working towards Diploma Violet Bateman: Cert CII and working towards Diploma Joanna Dominguez: Cert CII and working towards Diploma Brett Bass: Cert CII and working towards Diploma Janice Salmon: Cert CII Herman Lopez: Cert CII Martin Mckeever: ACII Chartered Insurer Tyrone Montovio: ACII Chartered Insurer

Business Briefs

WANTED! Lending Bank, Good Security not alone. Two months later the BBC headlined “Osborne Calls On Banks to Lend More” as the UK too, identified the same problem. Months on, and no solution appears to have been identified. It is unlikely that any government can force a bank to lend, despite their rhetoric. Indeed, following the global financial crisis, a new regulatory regime is making it harder for banks to lend so as to avoid future crises. Basel III rules introduce new requirements on bank liquidity and bank leverage. Some banks (eg DG Hypo, a major German based but European real estate lender) have already started to reduce or restrict lending blaming the onset of Basel III. Seems the banks may be caught in a bit of a “damned if we do damned if we don’t” scenario.

Mike Nicholls

Mike Nicholls, who operates Chesterton estate agency and owns MN Associates Limited, a local company specialising in Gibraltar property, funding and relocation, gives B2B his thoughts on the lack of financing available in Gibraltar for new projects. Mike is also a Fellow of the Institute of Chartered Accountants and a member of the Gibraltar Society of Accountant. “Because of the international banking crisis and credit crunch, it is almost impossible for private developers to obtain bank finance for [development] projects. Therefore, the Government is considering stepping in to remedy the situation.” So said the Chief Minister in last year’s budget. And Caruana is

Hence the need to be pragmatic and search for innovative solutions to match available capital seeking a return, to projects offering a return seeking capital. Nothing more complicated than a dating agency it would seem.

So it seems that market forces are sorting themselves out and new lenders across the insurance and funds sectors are lending where banks are not. So what can we do about it in Gibraltar? We are not on the radar of Prudential or Axa, or Canada Life or Aviva in terms of lending. Barclays and RBS’ retreat from funding local property development and commercial property investment has left a funding gap which threatens to derail Gibraltar’s growth. It seems to me that we need to be actively looking at imaginative ways to entice capital to some of our property development projects currently on standby using well thought through fund structures. Perhaps one of the many insurers in Gibraltar could underwrite the risk as part collateral for any loan as well. We need that “think tank” style of approach. In Europe, the big players are finding their way into the market. In Gibraltar, we are going to have to make it happen.

Assuming basic economic theory still prevails, then new lenders should enter the market to fill the capital vacuum left by the banks. And there must be real opportunities for the new entrants. According to CB Richard Ellis, the property consultants, more than 100 new lenders of mezzanine finance have emerged across Europe since the collapse of Lehman Brothers in September 2008. Furthermore, London-based property adviser DTZ estimates that non-bank lenders lifted their share of European commercial real estate lending to about 24 percent in 2010 from 13 percent in 1997. And Prudential’s head of real estate finance at its M&G unit recently stated “We have become a more active lender, both on a senior and mezzanine basis, over the course of 2010 and I expect our appetite for it will increase in 2011.

Ibex Insurance on the Move!

Ibex Insurance Services Ltd will be operating from new offices in Irish Town from the 4th of April. The newly renovated building will become home not only to the Ibex Gibraltar Retail Office, which is currently located in Horse Barrack Lane, but also the ever expanding behind the scenes team of underwriters,

claims, administration and management who are currently located in Marina Bay. The building which contains four floors has been designed to suit the needs of the team, yet its facade continues to be in keeping with the historical colonial feel of Irish Town itself.

This is an exciting development for Ibex Insurance, which was launched over ten years ago. Ibex Insurance has seen a steady and continuing growth both through its network of agents and via its retail offices, of which there are now 14 in Spain and two in Portugal, as well as it’s most well known one in Gibraltar.

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Business Briefs

Looking for some value? • What is the true value of the companies in my fund? • Is a valuation opinion required under the Companies Act or the Takeover Code (in the UK)?

Tax, Financial and regulatory reporting Businesses are increasingly confronted with tax, financial and regulatory valuation requirements. Developments in International Financial Reporting Standards (“IFRS”) and a general move to “fair value accounting” mean companies are sometimes required to reassess the value of their assets to comply with different regulatory requirements. Common situations in which a valuation may be required include:

Valuation is a controversial and complex subject. It requires in-depth understanding of the market, the asset and its competitors, financial and non-financial information, as well as factors such as the legal and regulatory environment. It is common to think of the term “valuation” in the context of estimating the worth of a business or a property. However, as this article will explore the reasons for and purposes behind a valuation are highly varied and encompass a wide range of business matters. It is possible to classify the motives for a valuation under the following headings:

Mergers & Acquisitions and investment analysis Whether evaluating strategic alternatives, acquisitions, or new ventures, valuation is often an imperative part of the deal-making process. Common questions include: • What are my strategic options for the business; how much is the business worth to me now? How much could it be worth to me? • What are the available exit routes and how much could the business be worth to potential acquirers? • What is my investment portfolio worth?

• Has your business just made an acquisition and needs to undertake a Purchase Price Allocation (“PPA”)? • Has your business previously made an acquisition in which it has recognised a large amount of intangibles and you need to consider whether these assets have been impaired? • Is your business undertaking a tax restructuring and needs to ensure that the transfer values are justified? • What is the impact of International Financial Reporting Standards (IFRS) on my balance sheet and profits?

Litigation, arbitration, expert determination and disputes Questions about value, or the valuation process, often occur in disputes, with the main driver for a need of a valuation being the experience of a loss of value as a result of a dispute. Possible cases include: • How much has the value of a business, or asset, been affected by a breach of contract, breach of warranty or infringement of a patent or the rights attaching to shares or an asset? • How much is a minority interest in an unquoted business worth? • Has a loss of value been suffered due to the professional negligence of an advisor? When questions like these arise, an independent, objective expert, who understands the issues and who can reach sound conclusions, is often sought.

Intellectual property and intangible assets The value of companies has been shifting markedly from tangible assets, “bricks and mortar”, to intangible assets like intellectual capital. These invisible assets are the key drivers of shareholder value in

the knowledge economy, but Financial Statements prepared under Generally Accepted Accounting Principles do not record these assets. Hence, the valuation of intellectual property and intangible assets can be more difficult than that of tangible assets, businesses or shares. Typical motives behind an intangible assets valuation include: • How much is my brand or patent worth? • What is the value of my customer database? • How much finance can I raise with my intellectual property rights as a security? • What loss have I suffered through infringement of my intellectual property rights? • What royalties can I expect to receive from new markets?

Reorganisation, turnaround and recapitalisation Allocating capital across diverse business units with competing projects in an ever-changing business environment is a challenge. Similarly, if a business is underperforming or facing financial loss, shareholders may want to dispose of some business units or instead seek some external financing to keep the business going. Common questions in such scenarios may be: • What is the value of security held over the business, assets or shares of an entity? • How to price Share Options granted to employees? • Is the value of the business greater than the amount of outstanding debt, and, if not, where does the value of the business sit relative to the debt structure? • What are the value implications of different reorganisation or insolvency options? In summary, valuation analysis is required for many reasons, from tax assessment, wills and estates, to divorce settlements, business analysis and basic bookkeeping and accounting. It is important to note that valuation is more an art than a science because it requires judgement. Consequently, all valuation models and methods have their limitations and are widely open for criticism. Moreover, since there is such a wide range of business reasons to carry out a valuation, in turn this requires different methods or a different interpretation of the same method each time. By: Eran Shay, Head of Financial Advisory Services, Deloitte Limited

Business Briefs

FOGG opens in Malta

Fogg Insurance Agencies Limited, an established and respected brand in the local insurance market, has relocated to new offices at La Concorde, in Ta’Xbiex. This move follows the recent acquisition of Fogg by the Argus Group in June 2010, and demonstrates the Group’s commitment to investing in and developing the local business operations. “The Argus Group has been successful both within its Bermuda heartland and with its operations in Gibraltar, so exporting this success to Malta, which shares market similarities, was a logical step for the Group,” Alison Hill, Chief Executive Officer of Argus Group explained.

Malta that are tailored to the needs of our Maltese consumers,” she continued.

welcoming new clients over the coming months,” Mr. Baker said.

Andy Baker, Chief Executive of Argus Europe relocated to Malta last year to support and oversee the operation and expansion of the Fogg business.

“The Argus Group has had a presence in Malta since 2005 via our relationship with the Fogg Agency, which was strengthened further through the acquisition of Fogg last year. We are very proud to be operating in Malta and look forward to being able to leverage our strong international network to bring market leading insurance solutions to

“Fogg Insurance has been operating in Malta since 1966 and is a very well known local brand. The winning combination of the Argus Groups underwriting expertise, complemented by the excellent local market knowledge of Fogg’s strong management team will allow Fogg to offer customers unbeatable service, whilst

“Fogg is also strengthening its existing operations by recruiting new staff, as well as offering continuing professional development opportunities to all staff, in line with the Group’s core philosophy,” Andy added.

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“We are very excited by the opportunities that will arise from growing and developing our business in Malta. We are confident that Maltese consumers will enjoy hearing and seeing a lot more of Fogg in the months and years to come,” Ms. Hill concluded..

Business Briefs

N&P approve Mortgages for new Affordable housing

The N&P (Norwich and Peterborough Building Society) is offering mortgages on two affordable housing developments in Gibraltar, the Society told B2B.. These mortgages will enable home-buyers to borrow up to 75% of the property price or valuation, whichever is the lower, and provide those looking to move to one of these

developments with a competitive deal to help them get onto the property ladder. Sam Hemingway, local manager of N&P told B2B: “The provision of affordable housing is incredibly important, and is a very good way of helping people get a foot on the property ladder. “We have introduced two discounted

mortgage offers exclusively available for Gibraltar’s Bayview Terraces and Nelson’s View shared ownership developments. This will give potential buyers the option to fix their repayments for a two year or three year period at a competitive variable rate of 5.35%. Prospective homebuyers can purchase between 50% and 100% of the Government’s share, and secure what could be a great step for them.”

Barclays Hiring in Gibraltar

Paul Gonzalez-Morgan

Barclays Wealth in Gibraltar has announced three appointments to their Premier Banking operations. Joshua Reuben and Stephen Ball join as Relationship Managers for Wealth Intermediaries and Paul Gonzalez-Morgan will take on the role of Premier Relationship Manager. Franco Cassar, Country Manager told B2B; “Barclays Wealth is a leading employer in the Gibraltar economy with a work force of over a 140. Our goal is to attract and retain the very best talent in the sector. Whether it’s bringing on board key industry players or developing our existing employees, the calibre of our staff is testament to our increasingly significant position in the marketplace.” “Economies around the world as well as the wealth management industry have

Joshua Reuben

experienced a period of turbulence but Barclays Wealth in Gibraltar has prospered thanks to both the quality of our people and our holistic offering of investment and banking services. We will continue to grow our business whilst investing in our employees to achieve our longer term goals.” Paul Gonzalez-Morgan joins the Premier Banking team from NatWest in Gibraltar where he has worked for almost 10 years, most recently as a Premium Banking Relationship Manager. Joshua Reuben started in his role at the beginning of February and is part of the Intermediaries team. Joshua has over 10 years’ experience working in various roles in the international markets in London, on Wall Street and in Toronto. Most recently, he worked as a financial controller at a private

Stephen Ball

equity firm in Gibraltar. Joshua graduated from Lubin School of Business Pace University New York. He said that he was “overjoyed” when offered the opportunity to join Barclays. Stephen Ball joins the Barclays Wealth Intermediaries team at the end of February, also reporting to Carlos Garcia. Stephen brings over two decades of experience working in the banking, finance and asset management sectors. He joins from the Commercial Property and Commercial Mortgage Backed Securities (CMBS) servicing team at Barclays Capital where he was instrumental in the successful operation of a Commercial Mortgage Backed Securities (CMBS) portfolio of over £500 million. He told B2B he was“delighted” to be joining the Intermediaries team in Gibraltar and is excited by the challenges and opportunities ahead..

People on the Move

Gibraltar is a building surveyor’s paradise

John Mckillop Smith FRICS FBEng FBIFM has been appointed as Managing Director of Chesterton Property Management and Chartered Building Surveyors, a new venture of Chesterton. John, a highly qualified chartered building surveyor, has over 25 years experience managing hundreds of commercial and residential properties and estates in the UK, having been the UK Commercial Operations Director for FPD Savills and Head of Building Surveying at Great Portland Estates PLC. In addition, John has project managed many refurbishments and rebuilds across the UK, most notably a £25m reconstruction project in the City following one of the IRA bombs. John was born, educated and married in Gibraltar before travelling to the UK to train as a surveyor. “Gibraltar is a building surveyor’s paradise” John told B2B. “It is a very exciting time to establish the Chesterton Property Management and Chartered Building Surveying Practice.

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The mix of old property stock together with the array of new developments built in the last 10 years means there is much work to be done in properly and professionally maintaining, or in some cases restoring, these assets. I returned to Gibraltar to spend more time with our family and friends. But maintaining and enhancing property, properly, is a particular passion of mine and I had no hesitation in taking up the Chesterton offer to expand its services to include building surveying and estate management.” Mike Nicholls, MD of Chesterton, has known John for a number of years and was clearly pleased with the appointment. “John is probably the most internationally experienced chartered building surveyor in Gibraltar and we are very pleased that he has joined us. We see all around us the effects of bad management or no management on properties in Gibraltar. I firmly believe that commercial landlords and resident committees managing their own buildings will benefit from John’s experience and advice.”

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People on the Move

Gino Bossino heads up to the “Top of the Rock” the Mayfair Hotel and the Britannia Hotel, both part of the luxury chain, Inter Continental Hotel Group. By then, fully versed in hotel management, he was asked to become the Middle East Regional Director of Sales & Marketing. Whilst at IHC he also completed a Strategic Marketing Management Course at the Havard Business School.

Gino Paul Bossino has joined the MH Bland Group as Manager of the recently refurbished Cable Car Top Station and the Mons Calpe Suite.. After having completed a Hotel Management degree with the Savoy Group and Westminster College London, Gino joined the Lowes Group at the prestigious Churchill Hotel. He then gained further experience at

George Gaggero told B2B ‘Being of good Gibraltarian Hotelier stock, Gino brings with him an excellent understanding and appreciation for the local tourist and business market. His wealth of knowledge and experience in hospitality will no doubt become immediately evident to those using the spectacular facilities at the “Top of the Rock”.’

the professionalism, commitment to excellence and eye for detail that had been instantly apparent in Gino’s enthusiastic approach to the this new opportunity. As well as enhancing the existing product on offer to tourists, his role will involve the continuing development of the unique Mon Calpe Suite as Gibraltar’s premier location for private functions, weddings, corporate presentations & special events. Gino is an active member of the Savoy Society, & HBS Executive Education Association..

In welcoming Gino to his new role, George Gaggero was quick to highlight

Providing a sharper perspective Value added audit We describe our audit methodology as “a top-down, risk based controls approach”, meaning we focus on the areas that matter. We will listen to your needs, consider the business implications and tailor our approach accordingly. This enables us to provide an efﬁcient and cost effective service providing added value well beyond basic statutory requirements.

For more information, call Joseph L Caruana or Daniel Delgado on: Tel: +350 200 41200, Fax: +350 200 41201, info@deloitte.gi

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People on the Move

Piers Watson Promotion at Toyota Gibraltar Stockholdings

Toyota Gibraltar Stockholdings is pleased to announce that Piers Watson has been promoted to the post of UN Sector Sales Manager. Piers has been with TGS for over 4 years now and has been involved with the UN Sales Team for most of that time. B2B has been told that “The experience he has gained, plus the hard work and commitment he has shown to TGS during this time meant that he was the natural choice when the post of UN Sales Manager was being considered. We wish Piers every success for his new challenge.”

Make a statement before you even say a word A spectacular & unique venue situated 412m at the Top of the Rock

| Corporate events | Celebrations | Dining | Weddings | For more information on what the newly refurbished Mons Calpe Suite and its extraordinary location in Gibraltar can offer you please contact our events coordinator on events@monscalpesuite.com or call +350 200 79478

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