The legal authority of the UK Government to extend the European Union Savings Directive to the UK's overseas territories is in doubt following a European Court ruling at a preliminary hearing in March 2003. The Directive is still in draft form and has not yet been adopted by the EU's Council of Minisiters, but in its current state would require EU member states to impose either spontaneous reporting or withholding tax. Although the Cayman Islands is a UK overseas territory, it is not a member of the EU.
May 31 2003