Jeroen Janssen advises major international clients. Jeroen focuses strongly on the Brazilian, Mexican and Israeli markets, assisting corporate clients, financial institutions and high-net-worth individuals on cross-border investments. Jeroen has worked in New York and London. He is a regular speaker at international conferences and is the author of several publications on tax topics. Jeroen heads the Latin America team of Loyens & Loeff, and visits the region on a frequent basis.
What inspired you to pursue a legal career?
I never had a plan to become a tax lawyer; it just happened. After high school I went to a prestigious business school, and when I graduated, I started studying law. Not because I wanted to become a lawyer. I wanted to become an investment banker or a management consultant. Although I was offered job opportunities for both, in the end, I had a feeling that I would be more successful as a lawyer. I followed that feeling and chose to work for the law firm I still work for today. As the Dutch writer Gerbrand Bredero said, life can turn on a dime.
What do you enjoy most about working in corporate tax?
Surprisingly, still the same things that made me pursue a legal career. The always-changing environment in the tax world is intellectually challenging. But it is not only a technical and intellectual job behind a dusty desk. Corporate tax means working with people. Working with clients and ambitious young colleagues, and solving complex problems, makes every day different.
What do clients look for in an effective corporate tax lawyer?
Being effective means good communication. Communication is 30 per cent talking, and 70 per cent listening and understanding. I think that most clients often have the feeling that the 70 per cent – the listening – is lacking. And when it comes to the 30 per cent – the talking – the drastic changes in the tax environment over the past few years and the increased uncertainties require, in my view, a good judgement on these developments, more than a detailed explanation of the current rules.
What challenges do you see on the horizon for lawyers in the corporate tax space?
Momentarily there is an international crusade against tax evasion as a result of a clear call in society that multinationals and high-net-worth individuals should pay their fair share. Encouraged by this call of voters, and attracted by the potential increase in the budgets, governments are introducing more and more open negative norms in their tax codes, like the general anti-avoidance rules (“taxed unless for business reasons”) and principle purpose tests (“taxed unless the main purpose thereof is not a tax benefit”). The interpretation of these open negative norms will evolve over time, and nobody can predict exactly how a judge will apply these rules five to eight years from now. Furthermore, the call for paying the fair share results in an increase of mandatory disclosure and exchange of private information. The open negative norms will more often put taxpayers in a position of being guilty, unless there is some reason ... and the information disclosure will put the tax authorities in a position where they have more information than the client. These developments will require more strategic judgement from advisers.
Another challenging development is artificial intelligence (AI), which will affect the added value of advisers to their clients. What I understand from AI is that it is most effective if it can be based on big data. Therefore, it seems likely that the added value of advisers will decrease in questions for which big data is available. It will eliminate hours that are currently billed for, and change the nature of services rendered.
Where, in your opinion, does the future of the practice area lie?
In the past, tax advice was a topic for the treasury department: “How much tax do I have to pay and when?” (As little and as late as possible.) Because of the developments described above (open negative norms and the increased disclosure and exchange of private information), taxes create more risks – not only financial risks but also reputation risks. Taxes are no longer solely a treasury department topic. Nowadays clients are less focused on paying as little and as late as possible, they are rather more focused on being in control, and they want to remain as flexible as possible in the changing environment.
I expect that these developments will also result in more tax litigation. The rules are drafted rather in favour of the tax authorities, and the authorities have an information advantage.
What is the best piece of career advice you have received?
When I started as a tax lawyer I had a strong focus on know-how. I wanted to know as much as possible in order to give the best possible advice to the client. When I became partner, one of the senior partners of the firm urged me to not just write complex advice, but to focus more on (potential) clients and developing my practice. According to him this was the only way to build a sustainable, flourishing practice. And he was right: a client presumes you are good. I’ve never seen a client asking advice from someone they presumed was not good. However, a client will call the adviser who is committed and invests in the relationship, not just by talking but more by listening and understanding his needs.
Jeroen Janssen advises major international clients. He focuses strongly on the Brazilian, Mexican and Israeli markets, assisting corporate clients, financial institutions and high-net-worth individuals on cross-border investments. Jeroen has worked in New York and London. He is a regular speaker at international conferences and is the author of several publications on tax topics. Jeroen heads the Latin America team at Loyens & Loeff and visits the region frequently.
DESCRIBE YOUR CAREER TO DATE.
My life in a nutshell: I first graduated from a prestigious business school in the Netherlands. After finishing law school, I started to work at Loyens & Loeff in 1994. I was seconded to New York, and worked for three years in the London office of Loyens & Loeff. After my return to Amsterdam, I became a partner of the international tax practice in 2005. As of 2007, I strongly focus on the Latin American markets, which is currently the basis of my practice.
WHAT ATTRACTED YOU TO A CAREER IN THE FIELD OF CORPORATE TAX?
At the start of my career I worked for two years in the M&A practice, but ultimately chose tax law. The complexity and continuously changing environment gives more intellectual challenges.
WHAT MAKES YOUR PRACTICE STAND OUT IN THE MARKET?
There are only three competitive variables: price, quality and relations. Competing on price creates a business risk, because most of your costs are fixed. Quality is preserved as a given – a minimum standard. If you do not deliver quality, you are not able to compete in the long-term. Relations is the variable that can make the difference, by giving attention to your clients and befriended firms, and showing long-term commitment. You cannot do that all by yourself. I am fortunate to be surrounded by an extraordinary team including Charlotte Kiès and Kirstin Hoenderken, and all the other great partners of the firm.
HOW HAVE LEGISLATIVE CHANGES SUCH AS THE BEPS PROJECT AND EUROPEAN ANTI-AVOIDANCE DIRECTIVE IMPACTED CLIENTS IN THE LATIN AMERICAN MARKET?
This development just started and will make the tax environment even more complex over the coming years. The advantages that tax treaties and bilateral investment treaties offer are substantial. There will be a continuous search for investment jurisdictions that better protect investments and make investments more efficient. However, if clients want to benefit from these advantages, investments should contain not only substance, but also functionality at the level of the investment vehicles. This means that more considerations than just tax become relevant to clients, if they implement structures. Long-term stable jurisdictions with a skilled workforce, a sophisticated regulatory environment and good infrastructure, are the competitive jurisdictions for the future. I expect the home jurisdictions of Loyens & Loeff (the Netherlands, Luxembourg and Switzerland) to be the market practice choice of the future.
Furthermore, I expect more tax disputes, because of mandatory disclosure rules and IT capacity of tax authorities. Also, many of the new rules contain what I call “open norms”. Open norms such as the PPT and the GAAR create uncertainty to taxpayers. For sure this more uncertain environment will result in a rationalisation and simplification of structures – especially structures of Latin American clients, because generally speaking these jurisdictions have relatively aggressive tax authorities that tend to challenge structures easily.
HOW HAS LOYENS & LOEFF ADDRESSED THE CHALLENGES CAUSED BY THE INCREASING PREVALENCE OF THE BIG FOUR ACCOUNTANCY FIRMS?
First of all Loyens & Loeff puts a lot of effort in being the leading firm for international tax development such as the BEPS. As stated, these developments create more risks and uncertainties for clients. I foresee an increase in demand for advisers with sophistication, quality and judgement. I am sure that the quality of the tax practice of Loyens & Loeff will make our firm even more competitive in the coming years.
WHAT CHANGES IN TAX OR TAX LAW SHOULD PEOPLE BE MOST AWARE OF OVER THE COMING MONTHS?
In the coming months, the impact of the ATAD implementation in Europe will be a hot topic, as well as the consequences of the new PPT in many tax treaties as of 2020. These developments will certainly impact existing investment structures of clients and will force many clients to reconsider their current structures. Additionally, I expect a continuous influence of transfer pricing, especially after the new transfer pricing guidelines.
WHAT HAS BEEN YOUR GREATEST ACHIEVEMENT TO DATE?
I have to give a politically correct answer to you: being elected as the corporate tax lawyer of the year by WWL in 2016. I will remember the wonderful award ceremony organised by WWL in New York for the rest of my life. The award shows to me that our network is one of the strongest, and that clients and lawyers of befriended firms value the relationship. It also makes me realise how important these relationships are to success and that we have to cherish it every day.
WHAT ADVICE WOULD YOU GIVE TO SOMEONE LOOKING TO START A CAREER IN THE FIELD OF CORPORATE TAX?
If you start working for a big multinational, your career path takes more than 30 years. Within a law firm the first 10 years are decisive. You should put a lot of time and efforts into your work during these early years. But also the firm should offer you opportunities and enable you to develop your skills. And please realise that if you make it, you will stay in practice for at least another 25 years. Therefore, the best advice I can give is to only start this journey if you really like the profession.