The Financial Times covers the Madeira's IBC in the "Invest in Portugal" Report

Funchal, 16th of April 2008: The Financial Times has dedicated a section of its Report about Portugal to the IBC of Madeira under the title "Madeira’s IBC: Island reaps the benefits of tight EU regulation". In this article, Peter Wise highlights the importance that proper regulation and transparency has had for the success of Madeira in attracting foreign investment.

Some highlights of the referred article are included hereinafter. You may read the full article here.

"Madeira’s IBC: Island reaps the benefits of tight EU regulation", By Peter Wise
Published: April 8, Portugal Report, Financial Times

Germany’s recent tax-evasion quarrel with Lichtenstein, which has been labelled an “uncooperative tax haven” by the Organisation for Economic Co-operation and Development, has highlighted how tight regulation of tax jurisdictions can be used as a competitive advantage to attract legitimate investors.

Madeira’s International Business Centre (IBC) has adopted this approach since it began offering investors substantial tax benefits 20 years ago as a means of helping the semi-tropical Portuguese island overcome its disadvantages as a small, peripheral economy lacking in natural resources.

“We have always insisted on total compliance with European Union and OECD rules on transparency, the exchange of information and supervision,” says Francisco Costa, the IBC’s founder and chief architect.

“The fact that we are not a tax haven or an offshore zone, but a well-regulated business centre operating within the EU under EU rules is crucial to our success.”

Madeira gained a further seal of approval from the European Commission in June last year when, after a long period of evaluation, it approved the extension of the IBC’s preferential tax regime until 2020. It had previously been due to expire in 2011. Under the agreement, Madeira can continue to licence companies to operate in the IBC until 2013.

“The Commission’s approval of a large extension is a vote of confidence in the IBC that sends an important signal to international markets and highlights Madeira’s credibility as a properly supervised and efficiently run jurisdiction,” says Mr Costa, who is chairman of the Madeira Development Company (SDM), which runs the centre."