Journal articles are an excellent tool for establishing literature on Gibraltar


Gibraltar is a small jurisdiction, and small jurisdictions can often be caught up in the tide of international legal change without the big players bothering. DAC6 can be used as an excellent example of this. It applies across the European Union to every jurisdiction within this vast trading bloc.

One of the issues that must be reported under DAC6 is any payment between associated enterprises where the receipt of the payment is subject to either a “total exemption” or a “preferential regime”. In the course of my reading and implementing a series of lectures and training sessions on the DAC6, it became apparent that some commentators were claiming that territorial tax regimes such as that of Gibraltar amounted either to an “exemption total”, or to a “preferential regime”. It was wrong. It was like the imposition of a point of view or a “standard” by large jurisdictions with large tax bases on small jurisdictions that simply work within their own framework. The territorial regime is not a regime, or some kind of fancy whistle. It is not a special diet. It is just what it is in its own terms. In other words, it felt like Gibraltar was being told that its entire tax regime was an aberration, despite pre-dating the EU Rome Treaty by 5 years. It looked like a usurpation of Gibraltar’s hard-won responsibility for its own tax system.

Upon reflection, it became clear that this point touched on very important questions concerning the interpretation of international provisions. How do we interpret them, do we do so from our own intellectual framework, or do we apply the words to other legal systems only as they are defined in that legal system? This is the best interpretation, and using Gibraltar’s EU state aid cases, me and my co-author Harriet Brown of the Old Square Tax Chambers aim to show that, when understanding words in a legal system, these words should be given the meaning used in that legal system and not a meaning imported from another legal system. In other words, Gibraltar decides what is a “preferential regime” in Gibraltar under its own law.

The academic literature relating to the legal system of Gibraltar is limited. The best way for lawyers to protect our system is to register it. In doing so, we set the limits of our law and create a body of work that will help protect it from the tides of international decision-making.

{ This article examines a method of interpreting multi-jurisdictional provisions that allows for the maintenance of the integrity of national legislative systems, particularly tax systems with diverse tax bases. To illustrate this, the article examines the meanings of the terms “exemption” and “preferential regime” as used in the EU Directive on Administrative Cooperation, Version 6 (DAC6).

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