The strategic role of the local manager in tax neutrality

1) Introduction — Tax neutrality is a governance outcome, not a label

Most investors approach cross-border acquisitions with three goals: bankability, tax efficiency, and privacy. The trap is to pursue them as separate checklists. In reality, they converge in one place: governance. If the company that will acquire and hold your villa is a hollow vehicle—no local decision-making, no board discipline, no evidentiary trail—banks hesitate, notaries slow down, and foreign tax authorities keep jurisdictional hooks.

In 2025 and beyond, the environment has hardened into published standards:

• Under MiCA, EU teams finally review crypto-asset counterparties using a single authorization language and transitional regime through 1 July 2026 for eligible incumbents; CASP provisions entered into application on 30 December 2024. Banks and notaries can now “book by paper,” not by reputation. AMF+2esma.europa.eu+2
• The EU travel rule (Reg. 2023/1113) plus the EBA’s Guidelines impose detect/reject/return duties for transfers lacking originator/beneficiary data from 30 December 2024. If the identity payload doesn’t move with the funds—and isn’t archived—funds stall. eba.europa.eu+1
• The OECD’s treaty logic keeps pointing back to substance and effective management; the Model Tax Convention’s Article 4 commentary on corporate residence and tie-breaker analysis elevates where strategic decisions are actually made—not merely where a company is registered. OECD+2OECD+2

In this world, tax neutrality is earned, not declared. It is the by-product of a proven governance reality: a local manager who makes decisions on the island, keeps board calendars, signs resolutions, supervises local accounting, oversees local banking, and maintains a documentary trail that speaks fluently to banks, notaries, and—if ever needed—competent authorities.

Promise of value. In the pages that follow, we explain what a local manager is (and is not), why this role is decisive for residency and neutrality, where files typically fail, the strategies that work in practice, and how SBH Capital Partners designs and operates gérance that turns rules into closing velocity. Chez SBH Capital Partners, nous aidons nos clients à transformer leurs actifs numériques en patrimoine tangible.

2) Definition — What is a “local manager” and how does the role anchor tax neutrality?

The local manager (gérant) is the individual (or board chair) who legally represents your Saint-Barth company on the island and in fact conducts its effective management. This is not a nominee or a mailbox; it is the governance center that satisfies four audiences at once:

1. Tax authorities care about corporate residence. Where is the place of effective management (POEM)? Under OECD treaty practice, that means where key management and commercial decisions necessary for the conduct of the entity’s business are made. It is a substance-over-form test. Minutes, signatory logs, and decision trails are decisive. OECD+1
2. Banks care about operational risk and traceability. Who instructs the account? Where are compliance calls answered? Who can evidence source of funds and beneficial ownership—and produce MiCA letters, travel-rule logs, and notary-grade exhibits on request? esma.europa.eu
3. Notaries care about French law finality and AML duty. They verify identity and source of funds as obligated professionals. A local manager who assembles a linear Funds-Mapping Memo—wallets → CASP/OTC → local bank → deed—saves weeks. OECD
4. Auditors/Regulators care about consistency. If DAC8/CARF and platform reporting escalate, does your company’s internal ledger match what third parties file? A local manager who curates data in those exact fields ensures you remain a low-touch file.

What the local manager is not.

• Not a rubber stamp that meets once a year.
• Not a remote director who signs everything electronically from a different time zone.
• Not a privacy shield you deploy to avoid transparency—because travel-rule and MiCA-era banking make opacity a liability, not an asset.

Analogy. If your company is an aircraft, the gérant is the cockpit. The airframe (French civil law) is solid, the engine (banking) is powerful, the navigation (tax treaties) is clear—but without a crew in the seat, the plane cannot take off.

3) Stakes & problem patterns — Where structures fail (and why the manager is the antidote)

Pattern A — “Registered here, run elsewhere.”
A company claims Saint-Barth residence but keeps decision-making off-island: board meetings by email, signatories abroad, banking in a foreign city. Under treaty practice, authorities look to where decisions are actually made. That points away from the island and invites foreign taxation. A local manager with decision logs, board minutes, and local banking instructions cures that defect. OECD

Pattern B — Bank holds triggered by travel-rule gaps.
Funds arrive at the local bank without compliant originator/beneficiary data. Post-December 2024, PSPs/CASPs are obligated to detect, reject/return, and document missing fields. A local manager designs transfers with the right payloads and archives provider attestations—so compliance can tick the boxes in minutes. eba.europa.eu

Pattern C — Notarial friction from weak provenance.
An acquisition funded by crypto requires notary-grade SoF. When files arrive as PDFs with missing links—no OTC certificates, no SWIFT MTs, no chain analytics—deeds slip. A gérant compiles the linear pack (wallet → CASP → local bank → deed) and liaises in French with the study. OECD

Pattern D — “Nominee risk” at audit.
Some investors appoint a nominal director who never sets foot on the island. That can damage credibility with banks and destroy POEM at audit. A real local manager is present, reachable, and documented across every decision that matters.

Pattern E — Reporting asymmetry (2026–2028).
With MiCA in force and DAC8/CARF rolling out, discrepancies between internal books and platform/bank reports will trigger questions. A gérant who curates ledgers to match these fields pre-empts mismatches. esma.europa.eu+1

Pattern F — Luxuries without governance.
Lifestyle choices (concierge staff, guest use, rentals) have tax and insurance consequences. Without a manager to approve policies (usage windows, cost allocation, rental periods), the fact pattern becomes ambiguous, inviting scrutiny.

Takeaway. The local manager is not “nice to have.” On every failure path above, the cure is a documented, local, decision-making center.

4) Solutions & strategies — How to operationalize gérance that survives scrutiny

A) Constitute the company with real substance

• Single-asset company (AHC): keep the object narrow (own, manage, and if desired, rent one property). Simplicity is bankable.
• Registered office & local accounting: invoices, ledgers, payroll (if any) are kept on island.
• Local bank account: all purchase funds and operating cash flows land and leave locally—with authorized signatories documented.
• Appoint a gérant (or board) resident on the island: mandate includes policy-setting, vendor selection, funds oversight, and regulatory correspondence.

B) Install board discipline

• Annual board calendar with scheduled meetings in Saint-Barth; extraordinary meetings for acquisitions, major capex, financings, or share transfers.
• Minutes and resolutions capturing who decided what, where, and on what evidence. Use standard templates; archive securely.
• Decision matrix that defines thresholds (e.g., repairs vs. renovations) and the approval route for each.

C) Engineer compliant rails for crypto-to-EUR conversions

• MiCA on paper: select CASPs/OTCs with authorization or transitional status on letterhead, with safeguarding and named compliance contacts. AMF
• Travel-rule payloads: ensure originator/beneficiary info travels with each crypto leg; store logs to satisfy the EBA’s guidelines and bank callbacks. eba.europa.eu
• Funds-Mapping Memo: pre-draft the 1–3 page story (wallet → provider → local bank → deed) with OTC certificates, SWIFT MTs, and chain analytics as exhibits. OECD

D) Codify personal use without weakening residence

• Usage policy approved by the board: who may stay, guest rules, blackout dates if the property is rented, cost allocation (utilities, staff), and insurance parameters.
• Occupancy register (discreet) to substantiate fact patterns if questioned—without compromising privacy.

E) Align with international tax standards—proactively

• POEM alignment: seat material decisions in Saint-Barth and document why. Keep evidence that the gérant evaluated alternatives and exercised judgment. OECD
• Pillar Two awareness (where relevant): while the 15% GloBE minimum targets very large groups, its substance-based logic reinforces the trend: where people and assets really are matters. OECD