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:

• by express reference to the schedule of the English Law (Application) Act, 1962;
• by Order of Her Majesty in Council;
• as expressed in the English act itself or in any other act; and
• by necessary implication.

Court Structure

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, King’s Bench and Family Divisions, as well as serving as an appellate function from the Magistrates’ Court.

Judiciary

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 over mostly by English judges. Appeals from that court are to the Privy Council, which sits in London.

Civil Proceedings

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:

• family jurisdiction – non-contentious probate, divorce and matrimonial proceedings, and child proceedings;
• civil jurisdiction – contract and tort, commercial matters, and constitutional, public and administrative law matters;
• appellate jurisdiction – the Supreme Court will hear appeals from certain tribunals as well as the Magistrates’ Court;
• admiralty jurisdiction – ship arrests and general admiralty matters;
• ordinary jurisdiction and company jurisdiction (Chancery equivalent) – equity and trusts, contentious probate, bankruptcy and insolvency, company matters;
• miscellaneous jurisdiction – landlord and tenant, mutual legal assistance, administrator general, deed polls, admissions to the Gibraltar Bar; and
• Court of Protection – jurisdiction over the property, financial affairs and personal welfare of people who lack mental capacity to make decisions for themselves.

Criminal Proceedings

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.

Lawyers

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. There is a practical training requirement 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.

The Legal Services Regulatory Authority (LSRA) regulates the legal services industry in Gibraltar.

The 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, when it was a member state) was 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 Gibraltar’s European Union (Withdrawal) Act 2019 (EUWA). The 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.

Although a Gibraltar Brexit deal was finalised on 31 December 2020, only hours before the UK was due to leave the EU, additional conditions are still being negotiated, at the time of writing. The government of Gibraltar has warned Gibraltar citizens to prepare for the possibility of a non-negotiated outcome in the event that it is not possible to conclude a treaty between the UK and the EU on the future relationship of Gibraltar. Such a possible “hard-Brexit” scenario would have a negative impact on a number of areas, including movement of goods and persons, cross-border healthcare, driving and telecommunications, among others. In a best case and “soft-Brexit” scenario, Gibraltar hopes to maintain fluidity at its land border with Spain, and could be included under the terms of the Schengen Agreement, although it is not expected to be fully integrated within the Schengen information databases maintained by the European Commission.

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 their 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 a 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 requirements 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 circumstances 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, protected cell 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 underlying 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).

Private Companies

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 and holding companies.

Trusts

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 their 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:

• the proposed name of the company;
• the liability of its members;
• whether the company is to be private or public;
• a statement of the intended registered office address;
• the memorandum of association and articles of association (to the extent that bespoke articles of association or the memorandum of association are to be adopted);
• in the case of a company that is to be limited by shares, a statement of the authorised share capital, initial shareholding and particulars of the rights attached to shares;
• in the case of a company that is to be limited by guarantee, a statement of guarantee from the proposed members; and
• a statement of compliance.

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 require 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:

• to exercise skill and care;
• to act in good faith and in the best interests of the company;
• to act within the powers conferred by the company’s memorandum and articles of association and to exercise powers for a proper purpose;
• not to fetter their discretion;
• to avoid conflicts of interest; and
• not to make a secret profit.

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 them in respect of any negligence, default, breach of duty or breach of trust of which they 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 their favour or in which they are acquitted. Companies may also purchase and maintain directors’ and officers’ liability insurance cover.

Shareholders’ Liability

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 share some similarities to 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 1932 and its subsidiary legislation, consisting of Orders and Regulations made under various sections of the Act, including but not limited to the:

• Employment Regulations 1994;
• Employment (Maternity and Parental Leave, and Health and Safety) Regulations 1996;
• Employment (Annual and Public Holidays) Order 1996;
• Conditions of Employment (Redundancy Pay) Order 2001;
• Fixed-Term and Part-Time Employees (Prevention of Less Favourable Treatment) Regulations 2003;
• Employment (Information and Consultation of Employees) Regulations 2005; and
• Conditions of Employment (Standard Minimum Wage) Order 2001.

Other primary legislation includes, but is not limited to, the Working Time Act 1999, the Equal Opportunities Act 2006 and the Employment (Bullying at Work) Act 2014, which is unique to Gibraltar with England and Wales never legislating in this manner for claims of bullying. The Employment (Trade Union Recognition) Regulations 2023 made under the Employment Act provide a framework for recognition by employers of trade unions for collective bargaining purposes and set out a statutory recognition procedure whereby a trade union may apply to the Director of Employment should an employer refuse to grant recognition.

Collective bargaining agreements apply to some employers; these are most commonly negotiated by trade unions. However, there are also new regulations in this area following the introduction of the Employment (Trade Union Recognition) Regulations 2023.

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 on 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 a 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 its contractual terms and conditions and incorporating any additional benefits.

In addition to the rights imposed by statute, there are other terms implied into contracts 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 known as the Notice of Variation of Terms of Engagement.

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 fixed or indefinite term. This must be set out in the Notice of Terms of Engagement.

Under the Working Time Act 1999, a worker’s average working time, including overtime, must not exceed 48 hours each week, over a 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 set out in the Working Time Act 1999.

In the case of a worker between the ages of 15 and 17 (inclusive), the maximum working time shall not exceed eight hours a day, or 40 hours a week (between midnights on successive Sundays), 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 1996 sets out the 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, employers often agree notice periods under the contract that are greater than those set out in statute.

A contract may also provide for payment in lieu of the notice period.

The first week of any employment under a contract of service is deemed to be probationary under statute, and the employment may be terminated at the end of such a week by either party without notice. After this period, the minimum statutory notice period must be applied, which will depend on, among other things, whether notice is given by the employer or the employee, and how often the employee is paid by the employer.

In the case of an employee giving notice of termination, the required period is determined by reference to how often they are paid only. For example, an employee must give one month’s notice to terminate the employment, unless the employee is paid weekly where one week’s notice is required. A failure to provide appropriate notice will give rise to a claim for wrongful dismissal. However, an employer may dismiss an employee, and an employee may abandon the service of an employer, without giving notice where there is good and sufficient cause for such dismissal (eg, gross misconduct) or abandonment, but an employer is not entitled to set up as good and sufficient cause that (a) the employee’s lack, loss or impairment of skill, ability or efficiency makes the fulfilment of the contract of service impossible, or (b) that the employee no longer enjoys the employer’s confidence.

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, ending with the effective date of termination and provided that the employee has not been dismissed for an automatically unfair reason (eg, making protected disclosures) where the qualifying period does not apply. 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. Depending on the reason(s) underlying the dismissal, employers may also need to consider the Employment (Bullying at Work) Act 2014 and/or the Equal Opportunities Act 2006.

After 52 weeks’ continuous employment, the employer must prove that there was a permitted reason for the dismissal of the employee. Permitted reasons for a dismissal are:

• reasons relating to capability of the employee;
• reasons relating to the conduct of the employee;
• that the employee was redundant;
• that the employee’s continuous employment would result in the contravention of the law; or
• some other substantial reason of a kind to justify dismissal.

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 including a basic award (GBP2,200 or such higher amount as calculated by a statutory formula) and a compensatory award which is capped, presently at the lesser of two years’ salary of the employee at the time of the dismissal and GBP65,707. There are deductions that can be made to these awards and the maximum upper limit for the compensatory award does not apply where an employee is found to be unfairly dismissed in certain circumstances, for example, dismissals in health and safety cases.

On termination of employment, a Notice of Termination must be filed with the Department of Employment.

Under the Employment Act 1932, 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 Employment Act 1932. The consultation must be undertaken by the employer with a view to reaching agreement with the employee representatives and must include a consultation about avoiding dismissals, reducing the number of employees to be dismissed and mitigating the consequences of the dismissals. Further, and as part of the consultation process, the employer shall disclose to the employee representatives and to the director the following in writing:

• the reasons for the proposed redundancies;
• the number and descriptions of affected employees;
• the total number of employees of any such description employed by the employer at the establishment in question;
• the proposed method for the selection of affected employees;
• the proposed method of carrying out the dismissals; and
• the proposed method of calculating the amount of any redundancy payments to be made.

A failure to consult in a collective redundancy situation can give rise to a declaration by the Employment Tribunal, and the Employment Tribunal may also make a protective award of compensation.

Employees dismissed for redundancy reasons are entitled to redundancy pay calculated by a statutory formula that is dependent on the employee’s years of service, subject to a maximum of one year’s pay and provided that the employee has completed one year’s service.

There are no general mandatory rights under Gibraltar law except regarding the following.

• 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 commonly known as TUPE.
• Additionally, the Employment (Information and Consultation of Employees) Regulations 2005 provide 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.
• Sub-regulation 4(1) of the Employment (Trade Union Recognition) Regulations provide that if a trade union wants to negotiate with an employer on behalf of a bargaining unit (defined as the group of employees concerned), it must be (a) registered and (b) recognised by that employer. The trade union may apply in writing to an employer for recognition as a bargaining agent (any such application needing to comply with Sub-regulation 4(4)) with the employer required within ten working days of receipt of that application to inform the trade union in writing whether it recognises that trade union as a bargaining agent or refuses to recognise the trade union as a bargaining agent and state the reasons thereof (Sub-regulation 4(5)). If the employer accepts the request for recognition then the parties must decide on a bargaining procedure. However, if the employer rejects the request for recognition, but (a) agrees to negotiate further, then a further 20 working days will be provided to negotiate (which can be extended by agreement of both parties under Sub-regulation (7)) or (b) does not agree to negotiate further, then the trade union may apply to the Director of Employment for statutory recognition in accordance with Regulation 5 (Sub-regulation 4(6)). Regulation 5 contains the regulations relating to an application to the Director of Employment for a statutory recognition order directing the employer to recognise the trade union, but there are basic requirements that must be fulfilled for an application for statutory recognition including that the employer must employ a minimum of 21 employees or at least average 21 employees in the 13 weeks ending with the day on which the request was received. There are regulations focusing on collective agreements (Regulation 7), bargaining units and disclosure of information (Regulation 10) and rights to be accompanied to a disciplinary or grievance hearing (Regulation 10).

Income Tax

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:

• personal;
• spouse;
• child;
• medical insurance premiums paid;
• life insurance premiums paid;
• pension contributions paid;
• first-time home purchase;
• mortgage interest;
• social insurance contributions paid; and
• pensioner.

The tax rates under the ABS are as follows:

• Individuals with gross assessable income not exceeding GBP100,000:
1. 15% on the first GBP4,000;
2. 18% on the next GBP12,000; and
3. 40% on the balance.
• Individuals with gross assessable income exceeding GBP100,000:
1. 16% on the first GBP4,000;
2. 19% on the next GBP12,000; and
3. 41% on the balance.

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:

• first-time home purchase;
• mortgage interest;
• pension contributions paid; and
• medical insurance premiums paid.

The tax rates under the GIBS are as follows.

• Individuals with gross assessable income up to GBP25,000:
1. 7% on the first GBP10,000;
2. 21% on GBP10,001 to GBP17,000; and
3. 29% on the balance.
• Individuals with gross assessable income of more than GBP25,000 and up to GBP100,000:
1. 17% on the first GBP17,000;
2. 20% on GBP17,001 to GBP25,000;
3. 26% on GBP25,000 to GBP40,000;
4. 29% on GBP40,001 to GBP100,000; and
5. 26% on the balance.
• Individuals with gross assessable income of GBP100,000 or more:
1. 18% on the first GBP17,000;
2. 21% on GBP17,001 to GBP25,000;
3. 27% on GBP25,001 to GBP40,000;
4. 30% on GBP40,001 to GBP105,000; and
5. 27% on the balance.

Any taxpayer with income of GBP11,450 or less is not liable to income tax in Gibraltar.

Social Insurance

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 GBP13.00 per week and a maximum of GBP37.00 per week.

Employer contributions are 18% of gross earnings subject to a minimum of GBP29.00 per week and a maximum of GBP51.00 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 the 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 have its income deemed as accruing in and deriving 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 GBP118,000 of assessable income (including worldwide income) meaning that a Category 2 individual will pay a maximum of GBP44,740 tax per annum, subject to a minimum tax payable of GBP37,000 per annum (current rates).

The requirements for Category 2 status are as follows:

• must have available for exclusive use approved residential accommodation in Gibraltar for the whole year of assessment (can be either purchased or rented);
• must have a minimum net worth of GBP2 million;
• must have private medical insurance (which must meet the minimum requirements of cover);
• must not have been resident in Gibraltar for five years immediately preceding the Category 2 application; and
• must pay an amount equivalent to the maximum tax payable (currently GBP44,740) as part of a Category 2 application, which will be held as a deposit and used to settle the individual’s final tax liability upon leaving Gibraltar.

High Executive Possessing Specialist Skills (HEPSS) Status

HEPSS status is a special employment tax status available to 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 per annum of their income under the Gross Income Based tax system of their assessable income only. This would mean that an individual with HEPSS status would pay a fixed amount of GBP43,140 tax per annum (current rates) regardless of their employment income.

The requirements for HEPSS status are as follows:

• must have available for exclusive use approved residential accommodation in Gibraltar for the whole year of assessment (can be either purchased or rented);
• must possess skills that are necessary to promote and sustain economic value in Gibraltar;
• must possess skills that are not readily available in Gibraltar;
• must not have been resident in Gibraltar for three years immediately preceding the HEPSS application; and
• must earn more than GBP160,000 per annum from that employment.

Development Aid

In order to encourage private development in Gibraltar, promoters and developers of approved projects are offered certain incentives such as tax relief, import duty relief and rates relief. In order to qualify for the above reliefs, the project needs to be a new project and meet certain criteria.

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.

The overarching anti-avoidance provision in place in Gibraltar relates to the principle of “artificial and fictitious”, as referring to transactions that are seen as inauthentic and not real.

The general anti-avoidance rules should be interpreted in the manner that best secures consistency with the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations and other documents designed as comprising part of the transfer pricing guidelines.

If an amount charged for goods and services by a connected person is not at arm’s length, the expense allowed shall be subject to a minimum of (i) the amount of the expense; (ii) 5% of the gross turnover of the company; or (iii) 75% of the pre-expenses profit of the company.

A person commits an offence if they are knowingly involved in the fraudulent evasion of income tax by them or any other person, and could be imprisoned for up to seven years.

On 1 January 2021, the Competition Act 2020 (the “Act”) was introduced into Gibraltar law. The Act is the primary legislation governing merger control in Gibraltar. Under the Act, notification of arrangements or proposed arrangements which might have resulted or might result in the creation of a “relevant merger situation” may be done on a voluntary basis.

A “relevant merger situation” is created for the purpose of the Act if two or more enterprises “cease to be distinct” and the value of the turnover in Gibraltar of the enterprise being taken over exceeds certain thresholds or meets the share of supply test.

Enterprises will be deemed to “cease to be distinct” if they are brought under common ownership or control.

Enterprises will be treated as being under common control if they are:

• enterprises of interconnected bodies corporate;
• enterprises carried on by two or more bodies corporate of which one and the same person or group of persons has control; or
• an enterprise carried on by a body corporate and an enterprise carried on by a person or group of persons having control of that body corporate.

The threshold for the value of the turnover in Gibraltar of the enterprise being taken over must exceed: (i) GBP1 million, if in the course of the enterprise ceasing to be distinct, a person or persons has brought a relevant enterprise under the ownership or control of the person or group; or (ii) GBP25 million in any other case.

The share of supply test is met if:

• as a result of the enterprises ceasing to be distinct, one or both of the conditions mentioned in Subsections (4) and (5) (as set out below) prevails or prevails to a greater extent; or
• in the course of the enterprises ceasing to be distinct, a person or group of persons has brought a relevant enterprise under the ownership or control of the person or group mentioned in Subsections (6) and (7) (as set out below) was satisfied in relation to the relevant enterprise before it ceases to be a distinct enterprise.

For the purpose of Subsection (4), in relation to the supply of goods of any description, at least two thirds of all the goods of that description which are supplied in Gibraltar:

• are supplied by one and the same person or are supplied to one and the same person; or
• are supplied by the persons by whom the enterprises concerned are carried on, or are supplied to those persons.

For the purpose of Subsection (5), in relation to the supply of services of any description, the supply of services of that description in Gibraltar is to the extent of at least two-thirds:

• supply by one and the same person, or supply for one and the same person; or
• supply by the persons by whom the enterprises concerned are carried on, or supply for those persons.

For the purpose of Subsection (6), in relation to the supply of goods of any description:

• at least two thirds of all goods of that description which were supplied in Gibraltar were supplied by or to the person or persons by whom the enterprise was carried on; and
• that supply was made in connection with activities of the enterprise by virtue of which it was a relevant enterprise.

For the purpose of Subsection (7), in relation to the supply of services of any description:

• the supply of services of that description in Gibraltar was to the extent of at least two thirds of all the services of that description, supply by or for the person or persons by whom the enterprise is carried on; and
• that supply was made in connection with activities of the enterprise by virtue of which it was a relevant enterprise.

Under the Act, notices of arrangements or proposed arrangements which might have resulted or might result in the creation of a relevant merger situation may be given to the Gibraltar Competition and Markets Authority (GCMA) on a voluntary basis.

Any such notice must contain the information and be in the form prescribed by the GCMA. Where the GCMA is satisfied that a merger notice meets the requirements set out in the Act, the GCMA must give notice to that effect to the person who gave the merger notice.

In the absence of an extension, the GCMA is required, so far as is practicable, to take such action as it considers appropriate to bring the existence of the proposal, the fact that the merger notice has been given and the date on which the period for considering the notice may expire to the attention of those whom the GCMA considers would be affected if the arrangements were carried into effect within 40 working days, beginning with:

• the first working day after the day on which the GCMA gives notice to the person who gave the merger notice; or
• the first working day after the day on which the GCMA informs the person carrying on the enterprises concerned by the notice that it has sufficient information to enable it to bring an investigation.

The GCMA may extend the initial period if it considers that a relevant person has failed (with or without reasonable excuse) to comply with any requirement of a notice under Section 168 requiring them to attend as a witness and produce documents in relation to the case in question.

Under Part VI of the Act, an individual is guilty of an offence if they agree with one or more other persons to make or implement, or cause to be made or implemented, arrangements of the following kind relating to at least two undertakings (“A” and “B”).

The arrangements must be ones which, if operating as the parties to the agreement intend, would:

• directly or indirectly fix a price for the supply by A in Gibraltar (other than to B) of a product or service;
• limit or prevent supply by A in Gibraltar of a product or service;
• limit or prevent production by A in Gibraltar of a product;
• divide between A and B the supply in Gibraltar of a product or service to a customer or customers;
• divide between A and B customers for the supply in Gibraltar of a product or service; or
• be an arrangement under which, in response to a request for bids for the supply of a product or service in Gibraltar, or for the production of a product in Gibraltar (i) A but not B may make a bid, or (ii) A and B may each make a bid but, in one case or both, only a bid arrived at in accordance with the arrangements.

Unless one of the last three points as set out above apply, the arrangements must also be ones which, if operating as the parties to the agreement intend, would:

• directly or indirectly fix a price for the supply by B in Gibraltar (other than to A) of the product or service;
• limit or prevent supply by B in Gibraltar of a product or service; or
• limit or prevent production of the product by B in Gibraltar.

Any person that is guilty of a cartel offence is liable:

• on conviction on indictment, to imprisonment for a term not exceeding five years or to a fine, or both;
• on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum (GBP10,000), or to both.

Proceedings for a cartel offence may only be instituted with the consent of the Attorney General and no proceedings may be brought in respect of an agreement outside Gibraltar, unless it has been implemented in whole or in part in Gibraltar.

The GCMA has the power to conduct an investigation if there are reasonable grounds for suspecting that a cartel offence has been committed.

Under Chapter 2 of the Act, any conduct on the part of one or more undertakings which amounts to the abuse of a dominant position within a market is prohibited if it may affect trade within Gibraltar. For the purpose of the Act, conduct may constitute such an abuse if it consists of:

• directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions;
• limiting production, markets or technical development to the prejudice of consumers;
• applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; or
• making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of the contract.

The prohibition set out above is subject to certain exclusions. These exclusions cover a number of scenarios including: services of general economic interest, compliance with legal requirements, avoidance of conflicts with international obligations and reasons of public policy.

Where the GCMA has reasonable grounds for suspecting that the prohibition has been infringed, it may conduct an investigation. If the GCMA forms a decision that the conduct infringes the prohibition, it may give to such a person or persons as it considers appropriate such directions as it considers appropriate to bring the infringement to an end. A direction may, in particular, include provision requiring the person concerned to modify the conduct in question or require them to cease that conduct.

If a person fails without reasonable excuse to comply with a direction, the GCMA may apply to the court for an order requiring the defaulter to make good their default within a time specified in the order, and if the direction relates to anything to be done in the management or administration of an undertaking, to require the undertaking or any of its officers to do so.

If the GCMA is satisfied that an infringement has been committed intentionally or negligently by an undertaking, it may require the undertaking concerned to pay the GCMA a penalty not exceeding 10% of the turnover of the undertaking in respect of the infringement.

A patent is a form of intellectual property which grants the inventor the right to exclude others from making or selling their invention for a period of time, thus being able to take legal action against anyone who makes, uses, sells or imports the invention without their 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 UK Intellectual Property Patent Office.

The grantee of a UK patent may apply within three years from the date of issue of the patent to have such a 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 together with the application for registration of a patent (Form 1) and a filing fee of GBP30 in accordance with the Patent Rules:

• certified copies of the specification(s) (including drawings, if any) of the UK patent; and
• certificate of the Comptroller-General of the UK Patent Office giving full particulars of the issue on such specification(s) and, in the case of a patent treated as being granted in the UK by virtue of the provisions of Section 2 of the Patents Act 1924, a certificate by an officer duly authorised under the Patents Act that the UK has accepted the European Patent (UK) designating the patent as being effective in the UK and that the particulars of the application are true.

Upon such an 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 Supreme Court of Gibraltar 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 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. In accordance with Section 3 of the Trade Marks Act 1948, and subject to Part 3 of that Act, any person being the registered proprietor of a trade mark in the United Kingdom by virtue of an entry in the register of trade marks kept under the Trade Marks Act 1994, or any person deriving title from such registered proprietor by assignment or other mode of transfer, may apply at any time during the existence of the registration in the United Kingdom to have such trade mark registered in Gibraltar in respect of some or all of the goods comprised in the United Kingdom registration.

Part 3 of that Act refers, in particular, to the following.

• An international trade mark (UK) (ie, a trade mark entitled to protection in the UK which results from an international application made on or after 1 January 2021 for registration under the Madrid Protocol and designates the UK) where the registered proprietor of an international trade mark (UK) shall enjoy in Gibraltar the like privileges and rights as though the certificate of registration of the international trade mark (UK) had been issued with an extension to Gibraltar. Those privileges and rights shall continue in force only for so long as the registration in the UK remains in force.
• A comparable trade mark (EU) and (UK) where the registered proprietor of a trade mark registered in the UK as a comparable trade mark (EU) or a comparable trade mark (IR) under the Trade Marks Act 1994 shall enjoy in Gibraltar the like privileges and rights as though the registration in the United Kingdom had been extended to Gibraltar, until the date of expiry of the registration of such trade mark. Those privileges and rights conferred shall continue in force only for so long as the registration of the comparable trade mark (EU) or the comparable trade mark (IR), as the case may be, in the UK remains in force.

The following documents are required in order to register a trade mark under the Trade Marks Act 1948:

• application for registration of a trade mark (Form 1) (the Trade Marks Rules 1948);
• certified representation of the trade mark and a certificate of the Comptroller of the UK Patent Office (under their title of Registrar of Trade Marks) giving full particulars of the registration of the trade mark in the UK and such other documents as may from time to time be prescribed (Section 4 of the Trade Marks Act 1948);
• where the trade mark to be registered is a device, two prints of the trade mark; and
• the applicable filing fee of GBP30 (the Trade Marks Rules 1948).

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 the trade mark is renewable every ten years and valid in Gibraltar as long as it is 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 it is registered in, and constitutes the ornamental aspect of an object. In Gibraltar, there are two forms of industrial design: registered and unregistered.

Designs registered in the UK are automatically protected in Gibraltar by virtue of Section 2 of the Gibraltar Designs Act 1928. 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, 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 where 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 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 qualifying work, 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 they believe 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, regarding 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:

• independent discovery or creation;
• observation, study, disassembly or testing of a product or object that has been made available to the public or that is lawfully in the possession of the acquirer of the information who is free from any legally valid duty to limit the acquisition of the trade secret;
• exercise of the right of workers or workers’ representatives to information and consultation in accordance with any rules of law applicable in Gibraltar; or
• any other practice which, under the circumstances, is in conformity with honest commercial practices.

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 the later of:

• the day on which the unlawful acquisition, use or disclosure that is the subject of the claim ceases; or
• the day of knowledge of the trade secret holder.

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:

• any negative economic consequences, including any lost profits, which the trade secret holder has suffered, and any unfair profits made by the infringer;
• elements other than economic factors, including the moral prejudice caused to the trade secret holder by the unlawful acquisition, use or disclosure of the trade secret; and
• where appropriate, damages may be awarded on the basis of the royalties or fees which would have been due had the infringer obtained a licence to use the trade secret in question.

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:

• implement the General Data Protection Regulation (Regulation (EU) 2016/679) (EU GDPR);
• transpose the Law Enforcement Directive (Directive (EU) 2016/680);
• implement a data protection framework under the Convention for the Protection of Individuals with Regard to Automatic Processing of Personal Data of 1981 (Convention 108); and
• implement Articles 126–130 of the Convention of 19 June 1990 applying the Schengen Agreement of 14 June 1985.

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 the 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 (Personal Data and Privacy) Regulations 2006 (CPDP Regulations), made under the Communications Act 2006; and
• the Data Protection (Search and Seizure) Regulations 2006 (DPSS Regulations).

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 “extraterritorial effect”, in that, respectively, the EU GDPR can apply outside the EU, and the Gibraltar GDPR can apply outside 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.

• Where a controller/processor has an “establishment” in Gibraltar and processing occurs “in the context of the activities” of that establishment. This applies regardless of whether the processing occurs in Gibraltar or not.
• Where goods or services are offered to data subjects in Gibraltar, irrespective of whether payment is required by a non-Gibraltar controller/processor. There should be an element of targeting and other evidence will be considered, such as whether consumers are able to pay in their local currency, or whether a marketing campaign has taken place. This test is also not limited by citizenship or residency of the data subjects.
• Where the monitoring of behaviour of data subjects in Gibraltar is carried out by a non-Gibraltar controller/processor. Examples of monitoring would be predicting trends, or use of geo-location.
• Where a controller is not established in Gibraltar, but in a place where Gibraltar law applies by virtue of public international law.

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:

• bring or defend legal actions in Gibraltar or other courts;
• co-operate with and render assistance to supervisory authorities in other states of territories;
• conduct data protection compliance audits;
• issue information notices, requiring others to provide it with information to investigate compliance;
• issue assessment notices to allow it to enter premises, obtain documents and equipment, and interview persons;
• issue enforcement notices, including warnings and reprimands, which may impose temporary or definitive bans on processing, or order a controller/processor to take corrective action; and/or
• issue monetary penalty notices.

Article 57 of the Gibraltar GDPR also prescribes the tasks and functions of the Information Commissioner. These include, but are not limited to: promoting awareness of rights and obligations; handling complaints; conducting 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 complement 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.

The UK and Gibraltar governments have agreed to reciprocal market access for UK and Gibraltar financial services firms. These are unique arrangements not available to any other Overseas Territory, Crown Dependency or Third Country and are being referred to as the Gibraltar Authorisation Regime (GAR). The UK Government has delegated the introduction of the GAR to HM Treasury and the current estimated timeline is that the GAR will come into force in late 2024 or early 2025. Until the GAR is in force, passporting rights will continue for firms operating between the UK and Gibraltar preserving the status quo of deemed-passporting for Gibraltarian firms following the end of the Brexit Transition Period. These transitional arrangements have been extended in the UK until Tuesday 31 December 2024 and may be further extended until such time as permanent arrangements under the GAR are in place.

No further legislative reform is expected in the near future in Gibraltar.