Britain’s off-shore islands a likely E.E.C. issue

Press, Volume CX, Issue 32459, 20 November 1970, Page 16

Britain’s off-shore islands a likely E.E.C. issue

(From

HOWARD WILLIAMS)

BRUSSELS. There are now real fears within the Common Market that one of the major stumbling blocks to British entry into the Community will be the politically uncontroversial question lof Britain’s off-shore I islands.

It is considered in Brussels highly unlikely that the question of the Channel Islands and the Isle of Man will be dealt with by the negotiators this year. Unofficial forecasts suggest that the probable time for detailed discussion on the islands will come in February or March.

Observers interested in this particular question had hoped to gain some idea of the fate of Britain’s “taxhavens” by decisions taken over the future of Gibraltar during the British talks.

Gibraltar, like the offshore islands, will be constitutionally one of the “European territories for whose external relations a member State is responsible” if Britain’s application suececds. Under article 227 (4), of the Treaty of Rome, which specifically uses this phrase, it is stipulated that such territories shall automatically be covered by regulations governing member States. During October, Britain’s chief negotiator, Mr Geoffrey Rippon, agreed with the Six that Gibraltar should come under the classification of a “European territory for whose external relations’*

Britain is responsible. Gibraltar will therefore become a fully-integrated part of the Common Market if Britain joins. NO DECISION MADE But no decision was made —indeed there was no discussion—on the question of Gibraltar’s special tax position. Leading sources in, Brussels closely connected with the British membership negotiations openly admit that it is possible that Gibraltar will lose or be forced to modify her special status. And constitutional experts are unaminous that whatever decision is made on Gibraltar it will have some bearing on the future status of the Channel Islands and the Isle of Man. It is felt in some quarters in Brussels that as “a matter of principle” the Six will demand some change in the tax status of both Gibraltar and the off-shore islands. However, and this can only be a guess at this stage, it is felt that all these territories will be able to keep many of their tax advantages. It is realised that if all the fiscal peculiarities are abandoned by these territories, much investment will be moved away from the new enlarged Community to other tax-havens such as Liechtenstein. “IMMIGRATION LAWS” But while the Channel Islands and Isle of Man are unlikely to keep sufficient tax advantages to satisfy their demands, they will probably be forced to “modify radically” their “immigration laws.” The Jersey States, for in-

stance, will probably be forced to abandon two of their notorious laws: The special immigration “premium” for mainlanders seeking to set up home of business in Jersey, and the law banning unmarried mothers from “outside.” Under Common Market

laws, any Common Market citizen has the same right to live and work in any Common Market territory as does a local of that area.

If Jersey, or any other offshore island, cannot accept these regulations it may well be forced to go “U.D.1.” And if that happens it will automatically lose its horticultural and agricultural market in the United Kingdom. A community of 10 nations (including Britain, Ireland, Denmark and Norway) would be more than self-sufficient in agricultural and horticultural produce. But any gloomy —or even optimistic forecasts for Britain’s off-shore islands are, at this stage, purely hypothetical. The truth is: nobody knows what will happen in the negotiations and nobody knows 'what position the Six are likely to take in the talks.