OFC History

The actual term Offshore Financial Centre was first used in the 1980's. Prior to this, such jurisdictions were and still are in some instances referred to as tax havens. A definition of and the actual term "Tax Haven" was coined sometime shortly after World War I. However, in medieval times, there is evidence of the "Tax Haven" concept with jurisdictions competing with one another. Examples of jurisdictions active in such times include, the Channel Islands, the Isle of Man and the Vatican City.

In the 1920's, Lichenstein introduced Offshore Trust Law in an attempt to attract foreign investment.

It is common belief that one of the earliest and most established such centres is "Switzerland" with very strict banking privacy laws. Ever heard of a Swiss Bank Account? In the early 21st century, Switzerland attracted significant foreign investment by taking advantage of the political turmoil in Russia and Germany. Switzerland did not get involved in World War I and remained neutral, hence when the reconstruction of neighbouring countries commenced, Switzerland was not burdened with such costs and was a much sought after tax haven with lower taxes.

Prior to World War II, France and Germany were both concerned about their citizens using Switzerland as a tax haven and attempted to pressure Switzerland into releasing certain information about individuals using the jurisdication as a tax haven. Switzerland's reaction was to pass strict privacy legislation to protect it investors and thus make Switzerland the safest jurisdiction in the world in terms of asset protection.

The following list is by no means comprehensive but gives an indication of the popular modern day offshore financial centres.