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However, they took billions out of Luxembourg and the
Netherlands in the final quarter of 2015 after the two countries
imposed new EU rules to crack down on abusive tax practices.
The flows into the British Virgin Islands and the Caymans were
roughly in line with historical averages but their source has
shifted from rich to developing countries in recent years, the
U.N. thinktank UNCTAD's report said.
From 2010 to 2014, Hong Kong, the United States, Russia and
China were the top four sources.
British Prime Minister David Cameron has come under increasing
pressure in the last few months to tackle tax evasion after
leaked documents from a Panamanian law company exposed how the
world's rich and powerful used secretive offshore company
structures to stash their wealth.
Companies shuffling money between jurisdictions to save on tax
remained "a key concern for policy makers", the U.N. report
said, noting that firms from a sample of 26 developed countries
registered more profits in Bermuda than in China in 2014.
The report said companies' "special purpose entities" (SPEs)
were typically subsidiaries that had little connection to the
local economy but held assets or liabilities or raised capital.
Quarterly flows to the SPEs in the Netherlands reached $148
billion in the third quarter, the highest since 2007, driven by
investment from Luxembourg and Britain, but then sharply
reversed.
Flows to Luxembourg, associated with funds financing investments
in the United States, surged in the first three quarters of
2015, triple on the same months of 2014, but turned negative
with a net divestment of $115 billion in the final quarter.
"The tight interrelation between SPE flows in Luxembourg and the
Netherlands highlights the existence of dense and complex
networks of these entities in both countries, with capital
flowing rapidly among them in response to financing needs and
tax planning considerations," the report said.
(Editing by Louise Ireland)
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