Contributed By ISOLAS
Gibraltar is a British overseas territory with a culture that emanates from the UK. Its laws are based on English Law (common law system) and although its jurisprudence is largely home-grown, English and Commonwealth judicial precedent and rules of equity, although not strictly binding, are of persuasive authority in Gibraltar.
Gibraltar has its own government and parliament that are responsible for domestic affairs, while its foreign affairs are handled by the UK. It has its own written constitution, and statutes are enacted by its parliament.
Certain English acts are applied, either in whole or in part, in the following ways:
While similar to the court structure in England and Wales, there are notable differences in Gibraltar. This includes the absence of a High Court, Crown Court and County Courts, with Gibraltar’s Supreme Court having jurisdiction over both criminal and civil matters. Gibraltar’s Supreme Court handles matters that would fall under the UK High Court’s Chancery, Queen’s Bench and Family Divisions, as well as serving as an appellate function from the Magistrates’ Court.
Judges and magistrates are appointed locally, with a parallel system of lay assessors in the Magistrates’ Court, as seen in England and Wales. The judiciary is independent from the government of Gibraltar and politically impartial.
Appeals from the Supreme Court are made to the Court of Appeal, which sits at periodic intervals and is presided mostly by English judges. Appeals from that court are to the Privy Council, which sits in London.
Under Section 38A of the Supreme Court Act 1960, the Civil Procedure Rules (CPR) made under the Civil Procedure Act 1997 in England and Wales, as amended from time to time, apply in Gibraltar, with such modification as the circumstances may require. The Supreme Court Rules 2000 supplement these procedural rules, providing further requirements in terms of, inter alia, interpretation, court records, fees and costs and prescribed forms.
Civil proceedings can be split into a variety of “jurisdictions”, but most are handled in the Supreme Court, with the Magistrates’ Court hearing only a limited range of civil matters (eg, the Stipendiary Magistrate holds the office of the coroner in the UK). These jurisdictions include the following:
The Criminal Procedure and Evidence Act 2011 prescribes the applicable procedure in the Magistrates’ Court and Supreme Court when they exercise criminal jurisdiction. Together with the Crimes Act 2011, these acts brought about significant changes to the criminal justice system in Gibraltar, effectively creating a modern criminal code for Gibraltar. From a business perspective, corporate manslaughter prosecutions are also possible, with extension of this offence beyond corporations to the police, trade unions, partnerships and employers’ associations.
All criminal proceedings commence in the Magistrates’ Court, with the more serious (indictable) offences being sent to the Supreme Court, either for jury trial or sentencing.
Most lawyers are England and Wales-qualified barristers or solicitors, with a minority of European lawyers. Qualification for call to the bar in Gibraltar is via a separate procedure to qualification in the UK, and it is possible for UK-qualified solicitors to be called to the Gibraltar Bar. A practical training requirement is required before admission to the Gibraltar Bar, consisting of a period of 12 months’ employment at an approved establishment, together with an approved academic course in Gibraltar law. In certain cases, the Chief Justice may waive one or more of these requirements – for example, when an English barrister is instructed to act as an advocate on a particular case or cases.
Gibraltar enjoys what is termed a “fused profession”, whereby both barristers and solicitors called to the Gibraltar Bar enjoy rights of audience in every court, and barristers can be “acting solicitors”. This results in practitioners with a diverse skill set who are all client-facing and able to conduct litigation or non-contentious work without restriction.
EU Law and Brexit
EU law formerly applied in Gibraltar pursuant to Article 355(3) of the Treaty on the Functioning of the European Union, as it was considered a territory over whose relations a member state (ie, the UK) is responsible. Following the end of the Brexit transition period, Gibraltar has retained certain EU legislation (subject to modifications where necessary) in a similar manner to the UK by virtue of its own European Union (Withdrawal) Act 2019 (EUWA). EUWA repeals Gibraltar’s European Communities Act 1972 and provides for the continuing validity of legislation passed or made for the purposes of complying with obligations derived from EU law.
By virtue of the UK opting out of the Schengen Agreement, Gibraltar is also not a part of this agreement, as is the case with the single currency of the EU’s Economic and Monetary Union, resulting in the Gibraltar pound sterling (GIP) being the local currency; this is pegged to, and exchangeable with, the British pound sterling (GBP) at par value. Gibraltar is also exempted from the EU customs union, and the common agricultural policy.
A Gibraltar Brexit deal was finalised on 31 December 2020, only hours before the UK was due to leave the EU. The deal allows Gibraltar to be included under the terms of the Schengen Agreement for passport-free travel, although it is not expected to be fully integrated within the Schengen information databases maintained by the European Commission. Additional conditions are still being negotiated at the time of writing.
In Gibraltar, there is no distinction between foreign and domestic investment. In general, there are no restrictions on foreign or domestic shareholders. However, certain financial services, gaming and telecommunications businesses do require pre-authorisation from a regulator regarding its shareholders to ensure that the shareholders are reputable persons and meet applicable fitness and proprietary requirements.
Generally, an application would have to be made to the relevant regulator (for example, the Gibraltar Financial Services Commission in relation to financial services business) as part of the wider application for the issuance of a licence in connection with the proposed activities. This sets out the details of the proposed shareholder, source of wealth, details regarding the fitness and proprietary of the individual (for example, whether the individual has ever been declared bankrupt) and details regarding the beneficial interest held.
Failure to notify a regulator of any changes in shareholders, or obtain the pre-approval of a shareholder, could result in regulatory sanctions and revocation of the relevant licence.
Generally, authorities do not condition their approval to certain commitments (although this may vary depending on the activities of the proposed investment), but individuals must notify the regulator should there be any material changes to the information provided in the initial application for approval.
Generally, there is no right of appeal. However, this will depend on the circumstance on a case-by-case basis as there may be situations where there is some element of recourse.
Corporate vehicles in Gibraltar may take various forms, these include trusts, foundations, limited partnerships, limited liability partnerships, companies limited by guarantee, companies limited by shares, protected cell companies and unlimited companies.
As each form of corporate vehicle contains its own unique set of characteristics, the most suitable vehicle for a particular use case will depend on various factors, such as the nature of the underling business activity or reasons for the establishment of the vehicle (eg, asset protection or succession planning).
Companies limited by shares are by far the most common form of corporate vehicle in use in Gibraltar. These may be set up as a private company (in which case the company’s shares or debentures are not allowed to be offered to the general public) or as a public company (in which case the company’s shares or debentures are allowed to be offered to the general public).
As with all companies, private companies are required to adopt articles of association which set out the rules governing the relationship between the company and its shareholders, as well as the responsibilities of its directors.
Private companies must have a minimum of one director, and there is no statutory maximum number of directors. A company may, however, provide for a maximum number of directors under its articles of association. A sole director of a company is unable to also act as the secretary of that company.
Private companies must have a share capital that is divided into shares of a fixed amount, and there is no minimum or maximum share capital requirement. Therefore, private companies may be set up with a single shareholder and can consist of any number of shareholders (although regard must be had to regulatory implications of what could be construed as a collective investment scheme) without the need to register as a public company.
Due to their flexibility, the ease with which they can be set-up and the limited liability offered to shareholders, private companies are usually perceived to be the preferred corporate vehicle for most businesses, joint ventures as well as holding companies.
A trust is an equitable obligation binding one party, the trustee, to control and manage property for the benefit of one or more parties, the beneficiaries. A settlor will transfer property to the trustee (whether during his or her lifetime or under a will) on specified terms which are usually contained in a trust deed and supplemented by a non-binding letter of wishes from the settlor to the trustees.
The provisions relating to the establishment and administration of a trust are contained in the document constituting the trust, known as the declaration of trust or trust deed. This document sets out the powers and fiduciary obligations of the trustees vis-à-vis the trust property/fund and the beneficiaries.
The incorporation process of a private company requires an application form, together with payment of the applicable fee, to be submitted to Companies House.
In the case of a company, the application form must include:
There is no requirement for the first director(s) and secretary of a company to be named on the application form. Instead, the Companies Act facilitates a 14-day period during which details of the first director(s) and secretary of the company, may be filed.
Standard incorporation takes approximately three working days and costs GBP100. However, Companies House also offers a same-day incorporation service for an additional GBP100.
Upon successful incorporation, Companies House will issue a Certificate of Incorporation which serves as conclusive evidence that the requirements of the Companies Act have been complied with and that the company is duly registered in Gibraltar.
Companies are subject to various ongoing annual and event-driven reporting and disclosure obligations.
All companies are required to deliver an annual return to Companies House, at least once in every calendar year. The annual return is a snapshot of certain information relating to a company including the company’s main activity, shareholders, directors, secretary and share capital. The annual return must be delivered within 30 days of the date which the annual return is made up to.
Companies are also required to deliver annual accounts to Companies House. The accounting principles to be observed when preparing the accounts vary, depending on the size of the company, and range from an abridged balance sheet to full accounts (including balance sheet, profit and loss account, notes, directors’ report and auditors’ report). The annual accounts must be filed within 12 months (in the case of a private company) or ten months (in the case of a public company) of the financial year-end. Special rules apply in the case of a company’s first reporting period.
Companies are also required to deliver certain information and shareholder resolutions when particular changes occur within the company. The Companies Act applies various filing dates depending on the event which triggered a filing requirement. In the majority of cases where filing of documentation is required, the Companies Act imposes a 30-day filing period.
There is a separation between ownership and control in companies limited by shares. Shareholders are the owners of a company and the directors are responsible for a company’s management and day-to-day running, owing a fiduciary duty to the company.
Most of the obligations and responsibilities of the directors and shareholders are set out in a company’s articles of association. However, the Companies Act does prescribe certain statutory obligations and responsibilities – for example, under the Act, any changes to a company’s name or articles of association requires the approval of a company’s shareholders. These statutory requirements cannot be overridden by a company’s articles.
Directors’ and Officers’ Liability
Under the Companies Act, the officers of a company may be held criminally liable for certain offences; these include situations where the officers fail to comply with certain filing and reporting obligations.
Directors are subject to common law, equitable and fiduciary duties. Broadly, these include the following duties:
The concept of “piercing the corporate veil” is recognised in Gibraltar and personal liability may therefore be imposed in certain situations – for example, where the directors permit an insolvent company or prospectively insolvent company to continue trading unless they can demonstrate that it is beneficial for the creditors to continue to do so.
Under the Companies Act, any provision that seeks to exempt or indemnify a director or officer of the company from any liability which by virtue of any rule of law would otherwise attach to him or her in respect of any negligence, default, breach of duty or breach of trust of which he or she may be guilty in relation to the company, is deemed to be void. This does not prevent the company from indemnifying directors or officers against liability incurred in defending proceedings (whether civil or criminal) in which judgment is given in his or her favour or in which he or she is acquitted. Companies may also purchase and maintain directors’ and officers’ liability insurance cover.
Under the Companies Act, the liability of the shareholders of a company limited by shares is limited to the amount unpaid on the shares respectively held by them. Shareholders may, however, be held personally liable in certain circumstances, such as where they provide a personal guarantee and accept a direct contractual liability with a third party.
The legal rules governing the employment relationship in Gibraltar is based on the employment law of England and Wales, both in terms of legislation and common law, modified to suit the needs of the jurisdiction. The applicable legislation is contained primarily in the Employment Act 1954 and its subsidiary legislation, including:
Other significant legislation is contained in the Working Time Act 1999 and the Employment (Bullying at Work) Act 2014.
Collective bargaining agreements apply to some employers; these are most commonly negotiated by trade unions.
Gibraltar employment law applies to all employees working in Gibraltar, irrespective of nationality or even residence given the large proportion of cross-border workers commuting to Gibraltar from Spain on a daily basis.
The parties to a contract may choose the governing law of the contract to be that of a different country. However, such an election of governance will likely be limited to contractual disputes and Gibraltar law will continue to govern the law to the employment relationship generally.
A contract of employment may be concluded verbally. However, there is a minimum requirement to file a Notice of Terms of Engagement with the Department of Employment for all workers. In some cases, this notice may be the only written part of the contract between an employer and employee and sets out basic mandatory terms of the employee's employment, such as working hours, salary, holiday entitlement and notice periods, the minimum of which are set in statute. While the requirement to file the notice is mandatory in all cases, some employers will also provide workers with a more detailed employment agreement, in addition to the notice, setting out contractual terms and conditions and incorporating any additional benefits.
In addition to the rights imposed by statute, there are other terms implied into contacts by common law including a duty to provide work and a mutual duty to maintain trust and confidence.
Variations to the employment relationship must be notified to the Department of Employment on a prescribed form.
The duration of the employment contract is not regulated under Gibraltar law but a worker is able to bind themselves to provide services for a specified or indefinite term. This must be set out in the Notice of Terms of Engagement.
The maximum time spent working, including overtime, must not exceed a weekly average of 48 hours, over an average period of 17 weeks excluding any periods of sick leave, maternity leave or annual leave.
However, any worker may agree with their employer in writing that this maximum should not apply to them, provided the employer can comply with certain requirements.
In the case of a worker between the ages of 15 and 17 (inclusive), the maximum working time should not exceed eight hours a day, or 40 hours a week, and such workers may not opt out of the stipulated maximum working time.
There is no minimum working time applicable to workers in Gibraltar. Accordingly, zero-hour contracts are permitted under Gibraltar law.
The Employment (Annual and Public Holidays) Order stipulates what rights employees have who work extra hours on public holidays when they are not ordinarily required to do so.
Employment contracts can be terminated by providing notice. Statute determines what the minimum notice periods are. However, often notice periods under the contract are greater than that set out in statute.
A contract may also provide for payment in lieu of the notice period.
After the first week, which is deemed to be probationary under statute, employment may be terminated by either party without notice, thereafter the minimum statutory notice period must be applied.
In the case of an employee giving notice of termination, the required period is determined by reference to how often they are paid only – ie, one week's notice if paid weekly and one month's notice if paid monthly. A failure to provide appropriate notice will give rise to a claim for wrongful dismissal. However, employees can be dismissed without notice in cases of gross misconduct.
Additionally, employees have a statutory right not to be dismissed unfairly if they have been employed for a continuous period of at least 52 weeks and are of less than retirement age, ending with the effective date of termination. Accordingly, employees may be dismissed “at will” before they have attained 52 weeks’ continuous service, provided that the employer complies with minimum notice provisions under statute or the contract, and provided that the employee is not dismissed for an automatically unfair reason such as pregnancy or membership of a trade union.
However, after 52 weeks’ continuous notice, the employer must prove that there was a permitted reason for the dismissal of the employee. Permitted reasons for a dismissal are:
If an employee is found to be unfairly dismissed, they are entitled to compensation calculated by a statutory formula and which includes compensation for the unfair dismissal and a compensatory award which is capped, presently at a maximum of GBP60,840.
On termination of employment, a Notice of Termination must be filed with the Department of Employment.
Under the Employment Act 1954, collective redundancy consultation requirements apply where an employer is proposing to dismiss as redundant five or more employees at one establishment within a period of 90 days or less. In such circumstances, the employer must consult with the affected employees’ representatives at the earliest opportunity and at least 60 days before the first dismissal takes place. Employee representatives include representatives of a trade union or representatives elected by the affected employee satisfying the requirements of the Act. The consultation must be undertaken by the employer with a view to reaching agreement with the relevant representatives and must include a discussion about avoiding dismissals, reducing the number of dismissals and mitigating the consequences of the dismissals. Further, and as part of the consultation process, the employer shall disclose to the representatives and to the director the following in writing:
A failure to consult in a collective redundancy situation can give rise to a claim for entitle to a protective award of compensation.
Employees dismissed for redundancy reasons are entitled to redundancy pay calculated by a statutory formula dependent on years of service, subject to a maximum of one year's pay and provided that they have completed one year's service.
There are no general mandatory rights under Gibraltar Law. However, various consultation requirements are imposed on employers in respect of collective redundancy situations (as discussed in 4.4 Termination of Employment Contracts) or where an employee is affected by a transfer of an undertaking.
Further, the Employment (Information and Consultation of Employees) Regulations 2005 provides a framework for the rights to information and consultation upon the request of employees. In such cases, the employer must make a formal agreement about what business information it will share with its employees and when it will consult them, provided the employer employs a minimum of 50 employees, and 15 employees or 10% of the total workforce (whichever number is greater) make the request.
Before the consultation process commences, the employer must arrange for its employees to elect the relevant number of information and consultation representatives by ballot: this means one representative per 50 employees or part thereof, provided that that number is at least two and does not exceed 25.
Income tax is charged on the profits or gains from any office or employment, including any allowances, perquisites or benefits in kind (such as expense payments, vouchers and credit tokens, living accommodation, car expenditure and loans to employees).
For employees, tax on the income from employment is deducted from wages and salaries under the pay-as-you-earn (PAYE) system. An employer is required to deduct tax from the wages of the employee on each pay, and then pay the tax by the 15th day of the following month.
Taxpayers may, in their tax return, choose between an allowance-based system (ABS) or a gross income-based system (GIBS). However, irrespective of the system opted for, on final assessment the Income Tax Office will apply the system most beneficial to the taxpayer.
Allowance-Based System (ABS)
This system enables an individual to claim certain allowances against assessable income. Allowances include:
The tax rates under the ABS are as follows:
Gross Income-Based System (GIBS)
Under the GIBS, a taxpayer is entitled to very few allowances/reliefs, but the applicable rates are lower.
The allowances/reliefs available under the GIBS include:
The tax rates under the GIBS are as follows.
Any taxpayer with income of GBP11,450 or less is not liable to income tax in Gibraltar.
Social insurance contributions are payable by every employee in any week in which they work.
Employee contributions are 10% of gross earnings, subject to a minimum of GBP12.10 per week and a maximum of GBP36.30 per week.
Employer contributions are 20% of gross earnings subject to a minimum of GBP28.00 per week and a maximum of GBP50.00 per week.
Individuals aged 60 and over are exempt from paying the employee’s share of social insurance contributions.
There is also an exemption (subject to certain conditions) from the employer’s and employee’s social insurance contribution in respect of an employee’s secondary employment.
A credit in respect of employer’s social insurance contributions is available to businesses with ten employees or less. This is increased to 20 employees for new businesses within the first year of operation.
Companies are taxed on a territorial basis of taxation, meaning that only income accrued in or derived from Gibraltar will be subject to taxation in Gibraltar. Accrued in and derived from refers to the location of activities, which gives rise to the profits of the company.
A business whose income arises from an underlying activity that requires a licence and regulation under any law of Gibraltar (such as a business licence or licence issued by the Gibraltar Financial Services Commission), or is licensed in another jurisdiction but enjoys passporting rights into Gibraltar, shall be deemed to accrue in and derive from Gibraltar.
Intercompany loan interest (which exceeds GBP100,000 per annum) and royalty income shall be deemed to accrue in and derive from Gibraltar if it is received by a company registered in Gibraltar. Intercompany loan interest and royalty income will be subject to tax at 12.5%.
The standard rate of taxation for a company is 12.5%.
There is no VAT or withholding tax on interest, dividend or royalty payments.
Companies could also be subject to import duty on the importation of certain goods, if applicable.
Stamp duty could also be payable on the transfer of a Gibraltar property owned by a company.
Gaming duty is levied at 0.15% on the gross profits of holders of a bookmaker, betting intermediary and gaming operator’s licence. The first GBP100,000 of gross profits is exempt from this duty.
There is no capital gains tax, estate duty, wealth tax, gift tax or inheritance tax in Gibraltar.
Category 2 Status
Gibraltar offers the opportunity for high net worth individuals to obtain Category 2 status which places a cap over the tax liability of that individual. Tax is applied to the first GBP105,000 of assessable income (including worldwide income) meaning that a Category 2 individual will pay a maximum of GBP39,940 tax per annum, subject to a minimum tax payable of GBP32,000 per annum (current rates).
The requirements for Category 2 status are as follows:
High Executive Possessing Specialist Skills (HEPSS) Status
HEPSS status is a special employment status available to those individuals with specialist skills who intend to relocate to Gibraltar to take up employment. An individual in respect of whom a HEPSS certificate is issued shall be charged to tax on the first GBP160,000 of their assessable income only. This would mean that an individual with HEPSS status would pay a fixed rate of GBP39,940 tax per annum (current rates) regardless of how much they would earn form that employment.
The requirements for HEPSS status are as follows:
In order to encourage private developments in Gibraltar, promoters and developers of approved projects are offered certain incentives such as tax relief, import duty relief and rates relief.
Tax consolidation is not available in Gibraltar.
Thin capitalisation rules are applicable in Gibraltar. For instance, interest paid on a loan by a company to related parties that are not companies, or loans secured by related parties where the ratio of the value of the loan capital to the equity of the company exceeds 5:1, would be considered a dividend payment and would not be a deductible expense for tax purposes.
The interest limitation rule in Gibraltar provides that exceeding interest expenses are deductible up to the greater of (i) 30% of EBITDA, or (ii) EUR3 million.
If an amount charged for goods and services by a connected person is not at arm’s-length, the expense allowed shall be the lower of (i) the amount of the expense, (ii) 5% of gross turnover, or (iii) 75% of the pre-expense profits.
Further, interest payments to connected persons which are in excess of what would be deemed arm’s length would be considered to be a dividend.
A person commits an offence if they are knowingly concerned in the fraudulent evasion of income tax by them or any other person, and could be imprisoned for up to seven years.
The regulation of cross-border mergers is governed by the Companies (Cross-Border Mergers) Regulations 2010, which allows for three types of cross border merger:
In addition, specific merger control notifications are applicable to certain regulated businesses, whereby consent is required from the applicable regulator prior to the merger taking place.
Under the Companies (Cross-Border Mergers) Regulations 2010, it is a requirement that merging companies obtain a pre-merger certificate from their respective courts. This involves complying with the administrative obligations, which include:
Court approval of the merger will then also be required.
Additionally, there are other regulatory requirements to be adhered to where the Gibraltar-based target is licensed and regulated in Gibraltar.
Anti-competitive agreements and practices are governed by the competition rules of Article 101 of the Treaty on the Functioning of the European Union (TFEU), which prohibits agreements that have, as their object or effect the restriction, prevention or distortion of competition within the EU, and which have effect on trade between EU member states.
Abuse of a dominant position in the market is governed by the competition rules in Article 102 of the TFEU, which prohibits any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it, as incompatible with the internal market in so far as it may affect trade between EU member states.
A patent is a form of intellectual property which grants the inventor the right to exclude others from making or selling his or her invention for a period of time, thus being able to take legal action against anyone who makes, uses, sells or imports the invention without his or her permission. The invention must not be specifically excluded from protection.
Original applications to register a trade mark or patent in Gibraltar cannot be made, the Gibraltar Registry will only replicate successful registrations made in the Intellectual Property UK Patent Office.
The grantee of a UK patent may apply within three years from the date of issue of the patent, to have such patent registered in Gibraltar in accordance with Section 2 of the Patents Act 1924.
As part of the registration process the following documents must be submitted to the Gibraltar Registry in accordance with Section 3 of the Patents Act 1924:
Upon such application being received, together with the documents mentioned in Section 3, the Registrar of Patents shall issue a certificate of registration in accordance with Section 4 of the Patents Act 1924. The protection of a patent will remain valid for as long as the UK patent is valid; the time period is 20 years from the date of issue of the UK patent, provided that the applicable renewal fees have been paid accordingly.
Patent rights are able to be enforced against a party through the UK or Gibraltar courts. The remedies for patent infringement include the seizure/destruction of the infringing goods, monetary damages and injunctive relief. Section 7 of the Patents Act 1924 outlines the powers of the Gibraltar Supreme Court and states that:
“The Supreme Court shall have power upon the application of any person who alleges that his interests have been prejudicially affected by the issue of a certificate of registration, to declare that the exclusive privileges and rights conferred by such certificate of registration have not been acquired on any of the grounds upon which the United Kingdom patent might be revoked under the law for the time being in force in the United Kingdom: Provided that such grounds shall be deemed to include the manufacture, use or sale of the invention in Gibraltar before the priority date applicable to the patent in the United Kingdom, but not to include the manufacture, use or sale of the invention in Gibraltar by some person or persons after the priority date applicable to the patent in the United Kingdom and before the date of the issue of the certificate of registration under section 4. For the purposes of this proviso the expression “priority date” in its application to a patent in the United Kingdom has the meaning assigned to it in section 5 of the Patents Act, 1949, or any other Patents Act for the time being in force.”
A trade mark is a sign which can distinguish the trade origin of goods and/or services from those of competitors. A trade mark must be considered to be distinctive, which means if it can be recognised as a sign that differentiates the origin of goods and/or services from those of other sources. A trade mark may include words, sounds, logos, colours, shape or any combination thereof.
The Registrar of Trade Marks deals with the registration of trade marks under the Trade Marks Act 1948 and the Trade Marks Rules 1948. It is not possible for originating applications to be made in Gibraltar. Therefore, a trade mark must first be registered in either the UK Intellectual Property Office, the European Union Intellectual Property Office, or the World Intellectual Property Office under the Madrid Protocol (with an EU or UK Designation).
The European Union Intellectual Property website confirms that a European Union Trade Mark extends to all member states inclusive of the UK and therefore Gibraltar. However, the position following Brexit remains unclear and it is advisable that those who wish to ensure protection both in the UK and Gibraltar post-Brexit should seek to register trade marks in both the EU and the UK separately – in other words, to err on the side of caution.
Trade marks registered in other EU national trade mark registries may not be registered in Gibraltar, unless it is an EU-registered trade mark or is registered under the Madrid Protocol at the World Intellectual Property Office with an EU or UK designation.
Under Council Regulation (EU) No 40/94 European Union Trade Marks, it is possible to obtain a single trade mark registration which is effective throughout the EU and such protection can be extended to Gibraltar.
The following documents are required in order to register a UK trade mark, a Madrid Protocol trade mark or a European Union trade mark:
Once all the relevant documents have been submitted to the Gibraltar Registry, the Registrar will then enter the prescribed particulars in the register and shall issue a certificate of registration to the applicant who shall then be the registered proprietor in Gibraltar of the trade mark in respect of the goods entered in the register.
The registration of UK and EU trade marks are renewable every ten years and valid in Gibraltar while they are valid in the UK or the EU.
Industrial design is an intellectual property right that legally protects the visual design of objects or part of an object in the territories that it is registered in and it constitutes the ornamental aspect of an object. In Gibraltar, there are two forms of industrial design, these being registered and unregistered designs.
Designs registered in the UK are automatically protected in Gibraltar by virtue of Section 2 of the Gibraltar Designs Act 1928. Registered Community Designs are also automatically protected in Gibraltar by virtue of the Treaty on the Functioning of the European Union. UK-registered design right applications are made and obtained through the UK Intellectual Property Office.
A design is legally defined as being the appearance of the whole or part of an object resulting from the features of, shape, colours or materials of the object or ornamentation. Both 3D and 2D designs are protected by registered designs. The design must not have been publicly disclosed or published within the EEA prior to being registered. There is, however, a 12-month grace period following the disclosure which allows the designer to make its application.
An unregistered design right in the UK arises automatically on the creation of an original object and it has been recorded in an article or design document, subject to the provisions of Part 3 of the UK Copyright, Designs and Patents Act 1988.
Designs registered in the UK have their rights are extended and protected in Gibraltar and there is no need for any applications to be made in Gibraltar. Designs produced in Gibraltar enjoy reciprocal protection in the UK under Part 3 of the UK Copyright, Designs and Patents Act 1988.
A registered design can be renewed every five years up to 25 years, subject to the payment of fees. The length of protection afforded to an unregistered design according to Section 216 of the UK Copyright, Designs and Patents Act 1988 will be 15 years from the earlier of the end of the calendar year in which the design was first recorded in a design document or an article was first made to the design or if articles made to the design are made available for sale or hire within five years from the end of that calendar year, ten years from the end of the calendar year in which that first occurred.
Owners of both registered and unregistered designs are able to enforce action through the UK or Gibraltar courts. For unregistered designs, remedies can include injunctive relief, damages or accounting for profit made. For registered designs, remedies can include injunctive relief, damages, accounting for profit made, delivery or destruction of the infringed product.
Copyright is a property right which subsists in sound recordings, films or broadcasts, original literary works – which includes databases, computer programs and preparatory design – dramatic, musical or artistic works and in the typographical arrangement of published editions. Copyright protects the author's work in several ways and prevents others from replicating this work, making an adaptation of this work, putting it on the internet and performing or playing this work in public.
Copyright protection is automatic upon the creation of the said qualifying work, and so no registration process is required. The length of the copyright is dependent on the type of work – for example, works such as written, sound, films and artistic work will last for 70 years after the author’s death.
A copyright holder is able to enforce court proceedings where he or she believes that there has been an infringement on the copyright and remedies include damages, injunctions and accounts. It is a criminal offence to infringe copyright.
Other intellectual property rights in Gibraltar also extend to trade secrets. This is a common law right in which the information contained within has commercial value because it is secret and the use or disclosure is likely to harm the interests of the trade secret holder in several ways – for example, scientific and technical potential, business or financial interests, strategic positions or the ability to compete.
In accordance with Section 4 of the Protection of Trade Secrets Regulations 2018 it is possible the acquisition of trade secrets in Gibraltar shall be considered lawful if obtained by any of the following means:
In accordance with Section 8 of the Protection of Trade Secrets Regulations 2018, the limitation period for bringing a claim for the unlawful acquisition, use or disclosure of a trade secret is six years. The start date for reckoning the limitation period for a claim for the unlawful acquisition, use or disclosure of a trade secret against an infringer begins with whichever is the later of:
Where damages are awarded in relation to unlawful acquisition, Section 16 of the Protection of Trade Secrets Regulations 2018 states that all appropriate aspects shall be considered, including:
In Gibraltar, the overarching national law on data protection is the Data Protection Act 2004 (DPA 2004). The DPA 2004 was amended on 25 May 2018 to:
The changes made to the DPA 2004 took Brexit into account, as well as the Data Protection Act 2018 of England and Wales (DPA 2018). Both statutes share a similar structure, but with notable differences, such as the repeal of Part IV of the DPA 2004, which related to intelligence service processing and was similar in structure and content to Part 4 of the DPA 2018.
Following the end of the Brexit transition period (see 1. Legal System), the DPA 2004 was further amended, and the EU GDPR now forms part of Gibraltar law by virtue of Section 6 of the European Union (Withdrawal) Act 2019, as read with (i) Section 2(1B)(a) of DPA, and (ii) the Data Protection, Privacy and Electronic Communications (Amendments etc) (EU Exit) Regulations 2019. This is now referred to as the “Gibraltar GDPR”, which is essentially the EU GDPR read with certain modifications. It is, therefore, important to read the Gibraltar GDPR and the DPA 2004 side-by-side.
The DPA 2004 and the Gibraltar GDPR are supplemented by the following:
The Communications Act 2006, together with the CPDP Regulations, transpose the E-Privacy Directive (Directive 2002/58/EC), imposing obligations on publicly available electronic communications services providers and users when they process personal data.
The DPSS Regulations, among other things, authorise justices of the peace to issue warrants to the supervisory authority (see 8.3 Role and Authority of the Data Protection Agency) in certain circumstances, allowing them to enter premises, inspect and seize as required.
Both the EU GDPR and Gibraltar GDPR have what is referred to as “extra-territorial effect”, in that, respectively, the EU GDPR can apply outside of the EU, and the Gibraltar GDPR can apply outside of Gibraltar. This is achieved in a similar manner in both pieces of legislation. Focusing on Gibraltar, the territorial scope of the Gibraltar GDPR can extend to any of the following situations.
Under Article 27 of the Gibraltar GDPR, controllers and processors established outside of Gibraltar would need to consider the appointment of a local representative in Gibraltar, if they are offering goods or services or monitoring the behaviour of data subjects in Gibraltar.
Controllers and processors based in Gibraltar offering goods or services or monitoring the behaviour of data subjects in the EU are subject to the EU GDPR, and will need to consider their obligations in that context. In particular, until the issue of adequacy is decided by the European Commission in respect of Gibraltar, appropriate safeguards (eg, such as standard contractual clauses) would need to be considered prior to a data transfer from Gibraltar to the EU or vice versa, given that, at the time of writing, Gibraltar is considered as a “third country” for the purposes of Chapter V of the EU GDPR.
The DPA 2004 designates the Gibraltar Regulatory Authority (GRA) as the Information Commissioner.
The GRA is an independent statutory body responsible for the enforcement of the DPA 2004, as read with the Gibraltar GDPR, and its primary role as Information Commissioner is to uphold the privacy rights of individuals.
Under changes made to the DPA 2004, the GRA now has increased regulatory powers under that Act, as well as those granted under Article 58 of the Gibraltar GDPR. These powers are classed as “investigative”, “corrective” and “authorisation and advisory”, allowing the Information Commissioner to, among other things:
Article 57 of the Gibraltar GDPR also prescribes the tasks and functions of the Information Commissioner. These include, but are not limited to, promoting of awareness of rights and obligations, handling of complaints, conducting of investigations and taking enforcement action against those controllers or processors failing to comply, and certifying and approving certain mechanisms and schemes such as contractual clauses or binding corporate rules.
The Legislative Reform Programme (LRP), which came into effect on 15 January 2020, consolidated and rationalised over 90 financial services legislative instruments into one Act (the Financial Services Act 2019) and additional supporting, sector-specific LRP Regulations. The LRP Regulations compliment the new structure, concepts and terminology of the Financial Services Act 2019 by consolidating prudential, business conduct and other requirements applicable to each financial services industry within respective sets of regulations.
No further legislative reform is expected in the near future in Gibraltar.