Malta the shapeshifter
The transfer of White Rock (Europe) from Gibraltar to Malta is symbolic of Malta's emergence as a serious cell captive domicile but, moreover, could Malta quietly be evolving into an EU reinsurance centre?
The redomiciling in October of global insurer Aon's White Rock (Europe) Protected Cell Company (PCC) from Gibraltar to Malta was a symbolic one in Malta's evolution into a fully rounded captive domicile.
Malta made its entry into the PCC club in 2004 with the introduction of the Companies Act (Cell Companies Carrying on Business of Insurance) Regulations.
Although it took Malta a while to get off the mark with PCCs, things eventually kicked off in late 2006 when the local office of Atlas Insurance converted an existing entity into a fully authorised PCC.
The subsequent arrival of an Aon White Rock facility not only speaks volumes about how rapidly the domicile's reputation has grown, but also suggests it is now time to take Malta seriously as a cell captive location.
"We always intended to have a White Rock in each domicile," says Chris Le Conte, head of White Rock Global. "White Rock Gibraltar has been there for some time and we set up White Rock (Europe) to meet some specific client needs a few years ago."
At the time of White Rock (Europe)'s formation, Le Conte says, there was discussion of setting up in Malta to give White Rock clients the choice between the two domiciles. "We have always been very open with the Gibraltar regulatory authorities that this was our potential aim," he says.
Things have developed in Malta considerably since then, says Le Conte. He sees the jurisdiction as potentially being of greatest interest to "captive-type clients", particularly those people operating in territories where there might be withholding tax issues. "We have had some enquiries already," he says.
"I think the framework will be very useful for people setting up captive-type business who are interested in a PCC option within the EU rather than a full direct writing captive, but wish to retain some risk in the cell."
Le Conte's believes that "offshore insurers" such as pure captives and third-party writers are also a large part Malta's future as a European financial centre.
"The other area that Malta hasn't really expanded yet, but I do see a big future for potentially, is reinsurance companies," Le Conte says. "I think there is room for another domicile within the EU to focus on reinsurance. Gibraltar is already starting down that path and undoubtedly Malta will as well."
At the Malta Financial Services Authority (MFSA), director of Business Development Michael Xuereb says that not only is reinsurance a growth area for Malta but there is definitely interest in Malta becoming an internal EU reinsurance centre.
"We're not saying that we would specialise in that," he cautions. "Obviously we would grow it together with the wider insurance service. It's part of the growing awareness of Malta as an insurance centre generally." The island will host its second Malta Insurance Rendezvous (in association with the MFSA) on March 4 and 5, 2009 at the Westin Dragonara.
Mr Xuereb says interest in Malta's reinsurance potential has been growing steadily since implementation of the EU Reinsurance Directive a year ago. Axeria Re was licensed in Malta in late December 2007 and Mr Xuereb says there are several applications for reinsurance companies in the pipeline.
Perhaps the biggest indication of Malta's potential in this respect, however, is the licensing on October 27 this year of Munich Re of Malta, a wholly owned reinsurance subsidiary of the global carrier.
Konstantin von Jagow, the new CEO of Munich Re of Malta, says the Munich Re Group decided to establish the Malta company for three distinct purposes. "The most important one is retrocession for internal group business, which means we will be the retrocessionaire for entities Munich Re has all over the world," he says.
"When we are well established, we could be offered as a risk carrier for third parties by Munich Re's global entities," Mr von Jagow continues. "And we are also looking at business coming from local insurers and captives."
Mr Von Jagow is cautiously optimistic for Malta: "Maybe we are an example for others because Munich Re always does things cautiously and assesses things first," he says. "I can only expect that it will grow, but after a few days here I'm not yet an expert."
The author is deputy editor of Captive Review, a leading UK title for the alternative risk transfer sector.
Malta made its entry into the PCC club in 2004 with the introduction of the Companies Act (Cell Companies Carrying on Business of Insurance) Regulations.
Although it took Malta a while to get off the mark with PCCs, things eventually kicked off in late 2006 when the local office of Atlas Insurance converted an existing entity into a fully authorised PCC.
The subsequent arrival of an Aon White Rock facility not only speaks volumes about how rapidly the domicile's reputation has grown, but also suggests it is now time to take Malta seriously as a cell captive location.
"We always intended to have a White Rock in each domicile," says Chris Le Conte, head of White Rock Global. "White Rock Gibraltar has been there for some time and we set up White Rock (Europe) to meet some specific client needs a few years ago."
At the time of White Rock (Europe)'s formation, Le Conte says, there was discussion of setting up in Malta to give White Rock clients the choice between the two domiciles. "We have always been very open with the Gibraltar regulatory authorities that this was our potential aim," he says.
Things have developed in Malta considerably since then, says Le Conte. He sees the jurisdiction as potentially being of greatest interest to "captive-type clients", particularly those people operating in territories where there might be withholding tax issues. "We have had some enquiries already," he says.
"I think the framework will be very useful for people setting up captive-type business who are interested in a PCC option within the EU rather than a full direct writing captive, but wish to retain some risk in the cell."
Le Conte's believes that "offshore insurers" such as pure captives and third-party writers are also a large part Malta's future as a European financial centre.
"The other area that Malta hasn't really expanded yet, but I do see a big future for potentially, is reinsurance companies," Le Conte says. "I think there is room for another domicile within the EU to focus on reinsurance. Gibraltar is already starting down that path and undoubtedly Malta will as well."
At the Malta Financial Services Authority (MFSA), director of Business Development Michael Xuereb says that not only is reinsurance a growth area for Malta but there is definitely interest in Malta becoming an internal EU reinsurance centre.
"We're not saying that we would specialise in that," he cautions. "Obviously we would grow it together with the wider insurance service. It's part of the growing awareness of Malta as an insurance centre generally." The island will host its second Malta Insurance Rendezvous (in association with the MFSA) on March 4 and 5, 2009 at the Westin Dragonara.
Mr Xuereb says interest in Malta's reinsurance potential has been growing steadily since implementation of the EU Reinsurance Directive a year ago. Axeria Re was licensed in Malta in late December 2007 and Mr Xuereb says there are several applications for reinsurance companies in the pipeline.
Perhaps the biggest indication of Malta's potential in this respect, however, is the licensing on October 27 this year of Munich Re of Malta, a wholly owned reinsurance subsidiary of the global carrier.
Konstantin von Jagow, the new CEO of Munich Re of Malta, says the Munich Re Group decided to establish the Malta company for three distinct purposes. "The most important one is retrocession for internal group business, which means we will be the retrocessionaire for entities Munich Re has all over the world," he says.
"When we are well established, we could be offered as a risk carrier for third parties by Munich Re's global entities," Mr von Jagow continues. "And we are also looking at business coming from local insurers and captives."
Mr Von Jagow is cautiously optimistic for Malta: "Maybe we are an example for others because Munich Re always does things cautiously and assesses things first," he says. "I can only expect that it will grow, but after a few days here I'm not yet an expert."
The author is deputy editor of Captive Review, a leading UK title for the alternative risk transfer sector.