With tax law and advantageous business tax manoeuvres so firmly in the spotlight at the moment, Emile G. Steevensz of Steevensz Beckers Tax Lawyers, based in Curacao, gives Business Worldwide Magazine his insight into the international tax industry, including the lowdown on the challenges and outlook for tax business in the Dutch Caribbean.
Can you give us some background on the business? Tell us a bit more about it was set up?
Steevensz Beckers Tax Lawyers originally started in 2011 as Certa Legal Tax Dutch Caribbean, and continued as Steevensz Beckers Tax Lawyers when Certa Legal in Netherlands decided to end their activities in the Dutch Caribbean. We focus on tax and have a general practice, but offer a particular emphasis on international tax issues. In 2012, Ruud Beckers joined me and set up Steevensz Beckers Finance to enable the business to grow stronger in the local market. Steevensz Beckers Finance is our administrative service provider and focuses on local SMEs or other businesses which are frequently family-owned. Ruud holds a Master’s degree in Accounting and heads this department.
How is it different from other law firms that offer the same type of services?
I think that our strong point is that we take the client by the hand, particularly foreign clients who set up small businesses here, and who are usually unaware of how things work here in the Dutch Caribbean. We run the whole process from incorporation to implementation so that they can focus on what they are good at and we take care of the taxations and accountancy side. I focus on tax and Ruud on administration and we use external experts in other fields; such as legal (mainly corporate as well as labour) or management and domiciliary services.
What are the biggest challenges facing your industry today?
The impact of BEPS (Base Erosion and Profit Shifting) and the recent publication of the Panama Papers have drawn global attention to jurisdiction in the Caribbean. The recent proposals of the EU together with its draft of an anti-EU BEPS directive forces us to focus on substance; a focus I feel is not necessarily a key one down the line with service providers and through to clients. We quite often see clients, especially medium sized enterprises, wishing to set up tax-advantageous structures or use tax-advantageous rules, but are reluctant to invest in the necessary substance to keep the benefits. Dealing with that change in mind set, with both advisors and clients, might be the biggest challenge for us at the moment.
Tell us a bit more about the other services you offer. Do you specialise only in the Dutch Caribbean or do you cover other geographical areas?
We focus on Dutch Caribbean tax law. We cover the Caribbean Netherlands, Aruba, St. Maarten and of course Curaçao. We have a strong focus on cross-border structuring, M&A and VAT.
Besides that we advise on Dutch tax matters in close co-operation with our partners in the Netherlands.
So, breaking down the specific services you offer…
The practice of Steevens Beckers Tax Lawyers is 100% tax based advice. We are two separate practices but we approach the market together and we each offer what we are specialised in; so I focus on tax, Ruud focuses on administrative services.
We generally practice with a focus on M&A, cross-border structuring, trading and finance, VAT, funds and more recently the private client practice. To give you a little insight; we have assisted and advised a foreign investor throughout the development of a 90-room hotel, assisting and advising on an international trading structure – the challenge here being to avoid negative tax consequences from Curaçao being blacklisted in Brazil. Additionally, we have assisted and advised a medium sized privately-owned Dutch company setting up its trading subsidiary; and advised and assisted in a fund for a mutual account which invests in local real estate.
It looks like you have a good blend of corporate and private clients. Tell us more about what drives your client base
Our private client practice is something we would like to develop further, especially in Latin America and Europe. We have interesting tools, such as the trust and private foundation, which make Curaçao attractive for private clients in common law as well as civil law jurisdictions.
In corporate practice we have been successful in setting up active businesses in Curaçao for foreign investors and thus combining low tax rates and actual substance. For larger businesses and MNEs we still have to offer interesting tax advantageous services and advice in trading, e-commerce, group financing and royalty structures, provided that the client is willing to invest in substance. Our treaty network is slowly growing; the recent tax treaty with Malta and the new Tax Arrangement Netherlands Curaçao has come into force, and a tax treaty with Cuba has been initialised. This last one might turn out to be immense; as a huge step towards bridging the gap between Europe and Latin America.
We do what we are good at and if we feel we don’t quite have the correct expertise to handle a client’s needs, we are not afraid to refer that client to another advisor. Furthermore, if we do have the expertise, we never make promises we cannot fulfil, and we’re transparent and straightforward in our pricing. Our clients always know exactly what the assignment will cost… and maybe we are just nice guys to work with!
It looks like you also work in the real estate industry – is that right? Tell us a bit more about that.
This comes from the private client practice. For larger projects our tax laws contain an advantageous tax holiday for real estate development. In the fund sector we have used the Fund for Mutual Account for an investment in local real estate. The benefit is that investors can enter and leave the fund without the need of a notarial deed that transfers the corresponding part in the real estate.
How do you drive the development of the business?
We keep particularly close contact with foreign law offices, visiting them frequently to stay in touch, and we make sure we meet at technical meetings and trade events to keep in touch with developments in the market.
What is the single biggest advantage to companies using Steevensz Beckers?
There are two advantages really. Firstly, our extensive knowledge and experience – but what’s also really good is our ability to just get the job done. We deliver.
How do you see the future of Steevensz Beckers developing, alongside market trends?
The market for international tax is changing rapidly and competition between jurisdictions is high. MNEs, as well as mid-sized (family owned) companies, might look outside Europe for expansion and/or specialist group entities for trading, finance and licences. We’re not gloomy about the future, but it is not easy to grow in the present market. If we can continue to obtain clients from Europe and Latin America who are willing to invest in actual presence, as we were able to in 2015, then I am satisfied. The private client market is becoming more and more important on a national as well as international scale.