Jersey to permit cross-border mergers

The Companies (Amendment No. 5) (Jersey) Regulations 2011 came into force on 23 February.

These regulations contain provisions enabling cross-border mergers between Jersey companies and foreign body corporates.

Before Amendment No. 5 came into force, it was only possible to merge a Jersey company with another Jersey company. Although it was possible indirectly to merge a Jersey company with a foreign company, by first bringing them into the same jurisdiction, this procedure is more cumbersome, time consuming and costly than a direct merger process.

To ensure that Jersey’s company law remains competitive, Amendment No. 5 amended part 18B of the Companies (Jersey) Law 1991 so as to permit cross-border mergers of Jersey companies with any other body corporate, wherever incorporated. This includes foreign companies, foreign incorporated bodies and also bodies incorporated in Jersey which are not companies, such as foundations. The resulting merged body will be either a survivor body (one of the existing merged bodies, which absorbs the others) or a new body created by the merger.