The advancement of technology has facilitated some significant changes in the ways companies manage their cash. The three core themes are automation, centralisation, and real-time operation. For companies operating internationally, it is now realistic to manage treasury operations from one or more regional or global treasury centres. A number of different countries offer financial incentives for multinational companies to operate treasury centres – examples include the Singapore FTC regime, Gift City in India, and various International Financial Services Centres around the world.

Yet, while the technology means that centralised treasury operations are possible and within the reach of most organisations, local regulation still places some restrictions in the way of a fully centralised standardised process. Understanding the rules, and how they might impact a company’s preferred structure, is a critical component of developing an effective regional treasury centre.

While each company is different, there are some key considerations that will affect how companies set up and operate a regional treasury centre. These might include issues such as: the rules governing the use of intercompany loans; cross-border payments; intra-group netting; transfer pricing and thin capitalisation rules as they relate to cash management; specific rules on payments – imports, royalties, payroll, tax and statutory payments, etc.- including exchange controls and central bank reporting requirements.

The WWCP Country Payment Reports provide important information to treasurers looking to manage international payments from an RTC. Each report explains whether it is possible to make cross-border payments into a specific country and the requirements for meeting local regulations on processing payroll.