Redomiciliation of Cayman Island Parent into Switzerland or Ireland

I am quoted a recent article in Portfolio magazine on the Garmin transaction. Garmin was a multinational corporation doing business in the U.S. and elsewhere. Its parent corporation was incorporated in the Cayman Islands. Garmin recently announced that it was changing the jurisdiction of its parent's incorporation to Switzerland. Publicly filed documents gave several reasons for this transaction including the advantageous tax treaty network in Switzerland, a perceived closeness to European customers and the negative public perception regarding Cayman Island companies and the (realistic) possibility of adverse legislation in the U.S. and elsewhere directed at such companies.

International tax practitioners both in-house and outside are noting a trend towards such redomiciliation transactions. The public perception of Cayman Island corporations and potential adverse legislation cannot be dismissed. In the case of many multinationals, the tax treaty network, low corporate tax rates and potential tax holidays could make Ireland or Switzerland even more attractive than the Caymans. It is a worthwhile exercise for multinationals to evaluate whether redomiciliation could work to their advantage.