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Thursday, November 9, 2017
Appleby lawyers hatched plan to set up Australian office
Appleby lawyers hatched plan to set up Australian office but avoid tax there
Secret proposal to set up stealth office in Sydney or Melbourne was named ‘Project Painkiller’
Lawyers at the firm at the centre of the Paradise Papers hatched a secret plan to set up an office in Australia but avoid paying tax in the country, leaked documents reveal. Appleby staff named their 2009 Australian expansion plan “Project Painkiller”, a reference to the signature cocktail of the British Virgin Islands, a Caribbean tax haven. The firm would create a “stealth” office in Sydney or Melbourne,
and initially use a single lawyer to drum up Australian business with
the “clear objective” of growing the operation over time. The plan sought to capitalise on the region’s increasing interest in
the tax havens of Mauritius and Seychelles, which would grow “in tandem
with the epochal rise of India, China and other emerging markets”. It also aimed to avoid taxes in Australia, a leaked project proposal shows. Appleby would set up a “special purpose” company in the British Virgin Islands which would invoice Appleby for all of the work conducted by its sole Australian lawyer. “During the first 12 months of the Sydney
office being in operation, [the lawyer] would continue to provide BVI
legal advice for clients as an associate, and would be billed out
through the BVI office to avoid any tax consequences in Australia for
Appleby,” the project proposal said. All the professional, marketing and business development costs incurred in Australia would be billed to the British Virgin Islands company. “Preliminary tax advice … confirms that this arrangement would ensure
that Appleby would not attract any direct tax consequences in
Australia, as [the lawyer] would be considered an independent contractor
for the purposes of Australian law,” the project proposal said. “The only tax consequences would apply personally to [the lawyer],
who would be required to pay personal income tax on any fees paid by
Appleby to [the lawyer’s] BVI company.” The Paradise Papers indicate the Australian expansion did not go ahead, although Appleby has declined to comment directly on Project Painkiller. The expansion was being pushed by two staff in its British Virgin
Islands office. Leaked emails show the pair were cautious about taking
the plan to superiors prematurely. “[Name removed], remember this is top secret just now,” one wrote.
“If cover is blown before ready to launch it will likely destroy chances
for success of your great idea.”
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The
pair joked about including pictures of native Australian wildlife in
the proposal they had submitted to senior Appleby management. “Maybe a
koala holding an apple should have gone on page three ... Or perhaps
more appropriately a giant apple eating a koala? :),” one wrote. Appleby was approached for comment, both by the Guardian and by one of its media partners, the Australian Financial Review. It told the Australian Financial Review it would not comment on Project Painkiller without seeing the relevant documents. The firm, which specialises in offshore corporate law, has been at the heart of the Paradise Papers, one of the biggest leaks in history. It has previously denied any wrongdoing by itself or its clients. In a general response provided
to the International Consortium of Investigative Journalists, Appleby
said: “We take any allegation of wrongdoing, implicit or otherwise,
extremely seriously. “Appleby operates in highly regulated jurisdictions and like all
professional organisations in our regions, we are subject to frequent
regulatory checks and we are committed to achieving the high standards
set by our regulators.”
Key revelations from the Paradise Papers
“Appleby has thoroughly and vigorously investigated the
allegations and we are satisfied that there is no evidence of any
wrongdoing, either on the part of ourselves or our clients.” The leaked proposal said the expansion would cost only $110,000 a
year and would have “no tax or regulatory consequences in Australia for
Appleby”. A presence in Australia would help Appleby grow its contacts in
Australia and across south-east Asia, the proposal said. Its offshore
competitors were yet to establish an office in Australia, which was said
to present Appleby with a unique opportunity. “Appleby could generate a great deal of positive publicity and
goodwill by going into Australia first – particularly given that
Mauritius and Seychelles structures will be involved in many of the
international transactions in Asia which Australian law firms and
financial institutions will be involved in,” the proposal said.
The firm already had 343 contacts in Australia, the report said, 60% of whom were concentrated in Sydney. But the greatest potential for growth in its contact list was in
Melbourne. “It is not unrealistic to propose increasing the number of
contacts for the firm to 1,000 within three years of opening an office
in Australia.” An Australian office would also help Appleby grow in New Zealand. Its
competitors, the report said, were already using New Zealand’s foreign
trust regime to gain tax benefits.
Betty MacDonald Fan Club, founded by Wolfgang Hampel, has members in 40 countries.
Wolfgang Hampel, author of Betty MacDonald biography interviewed Betty MacDonald's family and friends. His Interviews have been published on CD and DVD by Betty MacDonald Fan Club. If you are interested in the Betty MacDonald Biography or the Betty MacDonald Interviews send us a mail, please.
Several original Interviews with Betty MacDonald are available.
We are also organizing international Betty MacDonald Fan Club Events for example, Betty MacDonald Fan Club Eurovision Song Contest Meetings in Oslo and Düsseldorf, Royal Wedding Betty MacDonald Fan Club Event in Stockholm and Betty MacDonald Fan Club Fifa Worldcup Conferences in South Africa and Germany.
Betty MacDonald Fan Club Honour Members are Monica Sone, author of Nisei Daughter and described as Kimi in Betty MacDonald's The Plague and I, Betty MacDonald's nephew, artist and writer Darsie Beck, Betty MacDonald fans and beloved authors and artists Gwen Grant, Letizia Mancino, Perry Woodfin, Traci Tyne Hilton, Tatjana Geßler, music producer Bernd Kunze, musician Thomas Bödigheimer, translater Mary Holmes and Mr. Tigerli.
