Guernsey funds legal and regulatory update – June 2026

An overview of Guernsey legislative and regulatory developments relevant to investment funds for the period 3 March 2026 to 31 May 2026.

1.  Tax Review 

The States of Guernsey’s Tax Review Sub-committee (the Sub-committee), which was tasked with delivering recommendations on the best package of sustainable revenue-raising measures, has published its report (the Report) following a review of options for reforming Guernsey’s corporate tax system (forming ‘Workstream 2’ of a multi-strand approach to tax reform and public service delivery).

Among the Sub-committee’s recommendations are:

• to apply the intermediate (10%) company rate to the entire corporate entity undertaking activities within scope of that rate (which is expected to raise up to £0.5m a year), with the intention of simplifying compliance and reducing the risk of errors rather than simply generating additional revenue
• to extend the intermediate (10%) company rate to apply to certain registered prescribed businesses (which is expected to raise up to £2.5m a year, noting that many of these businesses are already taxed as partnerships at the personal tax rate), and
• to progress ‘Workstream 1’ (which focusses on changes to personal income tax, social security allowance and consumption tax), which is estimated to raise £50m a year.

The Report noted that Guernsey’s reliance on highly mobile international financial services means that any substantial change to Guernsey’s tax regime (such as introducing a territorial tax) could expose the Island to uncertainty and make Guernsey less competitive, thereby acknowledging the importance of tax stability, predictability and policy clarity in maintaining confidence as an international finance centre, particularly given the central role of financial services in the Island’s economy. It also aligns with the Guernsey Financial Services Commission’s (the Commission) Finance Sector Growth Strategy 2035, which identifies tax stability as a key foundation for sustainable economic growth and international competitiveness.

2.  Fund Foundry

Foundry Partners (LBG), a Guernsey-based not-for-profit, has launched ‘the Fund Foundry’, a programme which is aimed at supporting first-time and emerging fund managers across all asset classes. Applications open in July 2026, with five participants selected from a global shortlist of up to 20, confirmed following an on-Island selection event in September 2026.

Participants receive a structured support package, including a £25,000 service voucher for legal, administration and audit costs, access to a streamlined regulatory pathway (including one business day Private Investment Fund registration and use of the Commission’s Sandbox and Concierge Service) and mentorship from an established fund manager. The programme also facilitates engagement with prospective LPs.

Mourant is pleased to be supporting the initiative as a law firm sponsor.

3.  Innovation Sandbox

The Commission has published updated materials on its Innovation Sandbox (the Sandbox), including a revised webpage and new FAQs, reflecting feedback from its ‘Supporting Growth with Digital Finance‘ consultation.

The Sandbox provides a framework for applying existing regulatory laws and supervisory tools in a way that is proportionate to the nature, scale and risk of proposed activities, supporting testing and development, with a clear pathway to full operation or orderly exit.

These updates clarify how the Innovation Sandbox operates, its stages and what firms can expect, including their interaction with standard licensing, early engagement and participation. The Sandbox offers flexibility in evidencing regulatory requirements through tailored licence conditions, enabling firms to develop and launch innovative products within a structured, proportionate framework.

4.  Updates to the Handbook to support the use of technology

The Commission’s Handbook on Countering Financial Crime (AML/CFT/CPF) has been updated to support greater use of technology in combatting financial crime. The changes are as a result of the Commission’s Digital Finance Initiative and aim to provide clarity and reduce uncertainty, encouraging firms to adopt appropriate technological solutions to enhance the effectiveness and efficiency of their controls. They also clarify the use of commonly deployed tools, such as electronic verification systems and digital signatures, particularly in areas like onboarding, monitoring and record-keeping.

5.  Investment Statistics: Quarter 4 2025

Investment statistics for Quarter 4 of 2025 have been published by the Commission and are available here. Notably, the total net asset value of Guernsey funds at the end of the quarter was £272.8 billion, which is virtually unchanged from the previous quarter.

6.  Guernsey included in UK and Gulf free trade agreement

Guernsey has been included in the newly agreed free trade agreement between the United Kingdom and the Gulf Cooperation Council (GCC), marking a significant development in the Island’s international trade strategy. The agreement covers trade in goods and key aspects of financial services, reflecting Guernsey’s position as an established partner to the Gulf region in financial and professional services.

This development is expected to strengthen existing links with GCC member states – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates – while creating further opportunities for Guernsey businesses to access these growing markets. The inclusion, which follows sustained engagement between Guernsey and UK authorities, is seen as enhancing certainty, market access and long-term growth prospects for Guernsey’s finance sector and wider economy.