Client Alert: New Guernsey Offence of Failure to Prevent the Facilitation of Tax Evasion

The States of Guernsey issued an Ordinance on 20 July 2023 creating three new corporate offences for failure to prevent tax evasion, money laundering or terrorist financing.

This Client Alert focuses solely on the offence of the failure to prevent the facilitation of tax evasion (“the offence”), which the Ordnance introduces into the Criminal Justice (Miscellaneous Provisions) (Bailiwick of Guernsey) Law, 2006.

A “relevant body” (defined as a body corporate or partnership, wherever incorporated or formed) can commit the offence where a person acting in the capacity of a person associated with the relevant body facilitates tax evasion.? The legislation can apply to the facilitation of Guernsey tax evasion (which can be committed by a relevant body incorporated or established in any jurisdiction) or the facilitation of foreign tax evasion (which only applies to relevant bodies that are established under Guernsey law, carry on a business in Guernsey or where the facilitation of the tax evasion offence takes place in Guernsey).

A person is acting in the capacity of a person associated with a relevant body if they are an employee or agent of the relevant body, or any other person who performs services for or on behalf of the relevant body who is acting in the capacity of a person performing such services.

There is a defence under the legislation whereby a relevant body has in place such prevention procedures as it would be “reasonable in all the circumstances”, or it was not reasonable in all the circumstances to expect the relevant body to have any prevention procedures in place.

A relevant body guilty of an offence under this legislation is liable on conviction to a fine (no amounts are specified in the legislation).? As well as the corporate offence, individuals acting in certain roles for the relevant body (such as directors, managers, senior officers, partners, and foundation officials) can also be prosecuted where they have consented to the facilitation offence or it has arisen as a result of their negligence or connivance.

The commencement date of the legislation is not yet known.

Deloitte comment

This legislation is very similar to the UK “Corporate Criminal Offences” of the Failure to prevent the Facilitation of Tax evasion, which were introduced in the UK in 2017.?

Businesses can protect themselves by demonstrating they have preventative procedures in place which are adequately maintained and applied. In the UK adequate preventive procedures would include risk assessments, establishing procedural documents, communication and training, and ongoing monitoring and review. ?The legislation confirms that Guernsey guidance in respect of preventative procedures may be published in due course (in the meantime, as an example, the UK guidance can be found here).

Deloitte have extensive experience of assisting organisations to undertake a risk assessment and put in place reasonable preventative procedures which are key to mitigating risk in respect of the UK-equivalent legislation.

If you would like to speak to Deloitte to discuss the above further, please do not hesitate to contact any of the team below or your usual Deloitte contact.

We will be covering this topic as part of our upcoming “Tax Blast” webinar taking place on 19 September 2023 from 12:00-13:00.? If you have not already registered for this webinar, you can register by clicking here.

Jo Huxtable: 01481 703 308 or email

Martin Popplewell: 01481 703 229 or email

Gary Maclachlan: 01481 703 279 or email