Finance Regulation and Transparency 2025 Insights - Part Two

Peggy Gielen: Hello and welcome back to Jersey Heard. I’m Peggy Gielen, and today it’s my pleasure to bring you the second instalment of our hot topics of the 2025 Series. Now, since our last episode in April, several important developments have taken place that will shape the future of financial services in Jersey.

Joining me today is Karolina Pilcher, who has also been closely involved in these initiatives. Karolina, thank you for being here. I’m very excited. As always, could you remind our listeners about what Vision 2050 is and what has been achieved this year? And of course, I would be particularly interested in the together work stream.

[00:51] Karolina Pilcher: Sure. Absolutely. It is a big work stream for us this year in the summer episodes. When we were chatting, you know, we talked a little bit about the objectives and goals for this project. Since then, a lot of progress has been made and that’s really fantastic to see. And, you know, the implementation strategic implementation teams have worked really hard to help us deliver on some of the actions.

[01:13] Now we don’t have time to run through everything, but I will, I will mention. Together a work stream as well and some of the work there. But I also wanted to mention something that’s close to my heart. I skills. One great example of the work we have done with the industry is a teacher’s toolkit. This helps teachers guide students through career conversations about.

[01:34] The finance industry, it’s an online toolkit, breaks down in what industry looks like you know, what are different career paths, entry requirements, key skills. And we also have some real life examples of people that have started in the industry straight from school. So it’s really designed to help students make some of these informed choices about their future.

[01:56] So that’s the sort of skills be, if you like, on the together work stream. We are collaborating very closely with Pragmatix Advisory on a major research project, and the purpose of this project is to really assess the value of Jersey’s financial services centre to the Island. The idea is really to get some evidence and build on the evidence that we have already, I suppose, to support some of the strategic planning, policy development, but most importantly in that sort of conversation with the wider society and have a really meaningful public engagement as a result.

So the strategic implementation group on this occasion has been really closely involved throughout the project. They had worked with us to shape the research scope. They have met with Pragmatix team a number of times, and they also will be reviewing their draft findings that are due imminently.

So a lot of exciting work is happening behind the scenes and you know, I think we really are starting to see Vision 2050 take shape in a tangible way, which was always the purpose.

[03:00] We want to have tangible outputs. And talking about tangible outputs, I know that there is a lot of progress, as well, made on the government’s competitiveness program that we’re very close to, and Peggy, particularly around work stream two, which often is called the quick wins. Would you mind just telling us a little bit more about what government has been doing in this area and you know, some of the old outcomes that we have seen so far?

[03:24] Peggy Gielen: Yes, absolutely. Now, one of the key wins has been the announcements, of course, to the Jersey private Fund regime. This summer, several important changes came into effect. For example, Karolina, the investor cap has been removed. The definition of professional investor has been broadened, and there is now a possibility to listing interest in A JPF with consent from the JFSC.

[03:49] Peggy Gielen: Authorisation can be done in 24 hours or quicker, thanks to the straight through processing. And of course these enhancements give fund managers and investors greater flexibility and speed, and that makes Jersey an attractive jurisdiction for private funds. Now. Looking at some other programs. So for example, we’ve also updated the sound business practice policy, and that of course clarifies which activities may trigger heightened scrutiny.

[04:22] Peggy Gielen: Now it also streamlines regulatory processes, and so it now provides more predictable and efficient engagement from firms. The control of borrowing framework, that’s another project, or COBO as we refer to it.

[00:04:38] Karolina Pilcher: I think there’s a big meeting [happening right now] just behind the door!

[00:04:38] Peggy Gielen: Yes, that’s right. And so yeah, they are addressing this as part of the competitiveness program. The government has consultant on its proposed repeal, and so existing COBO consents, they remain valid, but the retiring of the framework will simplify approvals we think and reduce duplication. Make Jersey. A better regulatory environment, more modern business friendly.

And then of course you may have seen the JFSC has now consulted on updates to the A code to align with the EU’s AIFMD two rules. And again, that ensures that Jersey funds maintain EU market access. The EU is taking one approach, the UK is taking a different approach. So ultimately Jersey will have two separate A codes, one for the EU, one for the UK. And so that just ensures that funds domiciled here can operate smoothly in both jurisdictions.

So yes, in summary, the JPF enhancements improve flexibility and speed. The sound business policy clarifies regulatory engagement. And then the COBO repeal really modernises oversight. And then of course the AIFMD two updates. They protect our international market access, which is crucial. So these are very tangible outcomes.

[06:09] Karolina Pilcher: Absolutely. Already, it’s fantastic to see that rather than written word on paper. So that’s great. And you know, you started talking about AIFMD and Europe and our relationship and impact on those changes with the UK. So looking into next year, 2026, what’s catching your attention? What’s going to be on your agenda? What trends or themes do you think will be sort of shaping the conversation in the era ahead?

[06:35] Peggy Gielen: Yes. Well, I think one of the most significant trends is the continued growth of the private markets globally.

According to Invest Europe, private equity and venture capital assets on the management in Europe, they reached 1.25 trillion in 2024, which is up 7% from the previous year. Dry powder. That what dry powder means is committed capital yet to be invested again, that hit a record of four and 14 billion euros showing the scale of capital waiting to be deployed.

[07:11] And now the BVCA reported that UK private capital funds have consistently delivered strong long-term returns, and that’s around 15.8% per annum over 10 years. And you know, that is significantly outperforming public markets. Mm-hmm. So we hear that many companies are staying private longer, and investor interest in semi-liquid structures is also increasing.

[07:40] So that, again, Karolina deepens the private market segment. And for Jersey, this is a real opportunity.

We have strong fund regimes, we have regulatory clarity and international connectivity. So our island is really well positioned now. Our Members, of course, should also capitalise on this trend, and I would say leverage the enhanced JPF regime to attract and deploy capital efficiently. There is a real opportunity to design fund structures that appeal to long-term cross-border investors, emphasise Jersey’s regulatory clarity, and of course, our key strength is governance. That’s an area where we can really differentiate as a prime fund domicile and then stay alert to evolving investor demand.

[08:35] And that dry powder, of course, where you are looking for opportunities.

Karolina Pilcher: Absolutely. And I think, you know, as you say, we are well. Positioned because of all the reasons that you, you’ve mentioned, and you know, this, there’s this demand, the demand for wealth and wider financial services, it’s only going to be growing, right?

[08:54] We’re seeing this global wealth is really shifting right now, you know, and the money that sat in a few traditional economies, if you like, like US and Europe, it’s now such change. We’re seeing new wealth centers emerge in Asia, Middle East parts of Africa, so that demand for, as I say, you know, financial services will only grow, so we should capitalise on it as well.

[09:18] Thinking about 2026, for me, I cannot not mention election for next year. I think this is going to be having a big impact on our activity here in Jersey Finance. You know, not only because we are preparing or we will be preparing a manifesto to share with candidates, but also because we are working with the graph to encourage everyone to get out and vote.

[09:41] I think it’s the only way to make sure that, you know, our values are represented and we just need to show up and vote this time. The election is held on Sunday, section 7th of June, so there’s really not an excuse not to take part. And hopefully, you know, everyone should be receiving, I know I have the register to vote forms through the post it. Just make sure your name is on the list. Otherwise you’ll turn up on the day and we won’t be able to vote. And of course. If you are feeling particularly inspired to make a difference yourself, you can even stand for election because the registration of interest is still open. And that’s all listed on vote.je, Peggy, in case you’re wondering.

[10:22] Peggy Gielen: Well, I couldn’t agree more Karolina. So thank you so much for chatting with me today.

And to our listeners, of course, thank you for tuning into Jersey Heard. But before I sign off, may I just remind people who work in Jersey’s finance industry to sign up to our weekly newsletter industry insight where they can receive the latest update from us by simply creating an account at jerseyfinance.com. And of course you can also follow Jersey Finance on all the social media platforms, LinkedIn, Instagram, and Facebook. Until next time, stay well. Thank you for listening.