Switching entity providers in Jersey is easier than you think

As a major international finance centre, Jersey offers plenty of expertise when it comes to the management of your corporate entities and SPVs. Some companies can, however, find themselves in a situation where their service level expectations are not being met by their current servicing partner.

In this article, Michelle Merola, Ocorian’s Business Development Director, explains why switching can be easier than anticipated and advantageous for your business.

Reasons for switching

The reasons for companies to reconsider their current service providers vary, but some of the more common reasons include:

• Service levels – Service expectations are not met, no defined point of contact or escalation, and slow response times are common pain points when it comes to servicing problems. 

• Expertise – Companies lack confidence that their entities are meeting local substance and regulatory reporting requirements.

• Growth – Successful companies may simply outgrow their current service provider. As entity volumes increase, or a company grows their global presence, greater expertise, better technology, and a wider international reach may become more important.

• Billing – When the expectations around cost and transparency are not met and there is a reason to believe that the companies are not paying a fair and competitive price for the service they are receiving. 

Making the break

So why do companies stick with an existing relationship, even when it is no longer meeting their expectations? There are many perceived barriers to switching. Some of them include:

• A potentially lengthy and complex onboarding process with the new provider

• Concerns over how the existing service provider might react

• Concerns that embedded knowledge would be lost with the switch

• Switching fees

These are, of course, very valid concerns, but they fail to acknowledge the risks of remaining with a service provider that is not meeting companies’ needs.

The time and effort of switching

It is true that the regulatory due diligence required to switch service providers does take time, but a good service provider will walk you through this process and simplify and project manage the transition from your current service provider over to the new one. Furthermore, at Ocorian we will complete a health-check on each entity as it is onboarded to make sure the books are up to date and the substance and regulatory reporting requirements are being met.

The incumbent’s reaction

The termination of professional relationships happens all the time and are invariably dealt with in a professional manner. All service providers will have a termination notice period that will need to be adhered to, and the newly appointed service provider will project manage the transfer process. The transition should be relatively seamless from the companies’ perspective with checklists and secure transfer methods.

The expense of switching

There are fees associated with switching providers, but often these are not weighed against the inherent costs of staying put. Unpredictable annual fees, the time invested in managing an unproductive relationship, and the risks associated with non-compliance can all have a significant, long-term impact on a business.

Realising the benefits of switching

When you choose the right provider for the size, scale and sophistication of your business, the benefits for your business are significant and include:

• Fresh insight and expertise for your business, not just to manage your annual obligations – but also to support during core transactional activity such as M&A, investment and restructuring

• Confidence that your entities are compliant with all local regulation and are being managed to best practice standards

• Insight into future regulations coming down the line and proactive support in preparations around these

• Time and space to give your day job the attention it deserves

• International expertise – insight and hands-on support with your investment or expansion plans across the globe

How can Ocorian help?

If you’re thinking of switching entity management providers in Jersey, talk to Ocorian first. With 2,000 employees in 20 global offices, we offer local expertise and global reach. Our resources are highly scalable, and we believe passionately in dedicated personal contacts and complete price transparency.

Our solutions are tailored to your needs – we take the time to get to know your company inside out so we can serve you better.  Know more about our entity formation and management services.