Annual Report - paperJam

Having said this, not all is doom and gloom. Over the decades, the Luxembourg financial centre has
developed an expertise and know-how that is unrivalled. We already have the right building blocks to
re-invent ourselves and to adapt to future challenges.
By adopting the internationally agreed OECD standard in tax information matters,
new avenues and opportunities have opened up. Luxembourg needs to adapt to a
world where clients have regularised their tax situations. This new reality is to be embraced.
We thus have to continue to push for a global level playing field and promote
Luxembourg as a competency centre that combines client confidentiality, financial
security and a high-level of sophistication.
Finance Minister Luc Frieden, as Chairman of the Senior Committee of the Financial Centre, recently
presented a vision for the future of the financial centre, relying on five business pillars: wealth management,
investment funds, international loans, insurance and structured finance.
Future growth in our private banking business lies in new markets and a new client
base. The focus will be more on attracting entrepreneurs and high net-worth individuals
with multi-jurisdictional interests, beyond our traditional clientele from the
Greater Region. The Luxembourg financial centre’s most significant strength lies
in the provision of cross-border services and products. Highly mobile international
clients, in particular, appreciate this.
Moreover, the introduction of a new expat tax regime for highly skilled employees will be an important
asset in attracting the necessary talent to service this more demanding and sophisticated clientele.
Luxembourg could further attract private equity fund managers and foster the development of asset
management skills, by clarifying and improving the taxation regime on carried interest.
Our cross-border expertise also lies at the heart of the success of our fund industry.
In December 2010, Luxembourg became the first country to transpose the UCITS IV
directive into national law – just as it did with the first UCITS directive back in 1988.
Again, the potential to further develop the financial centre is significant.