In the words of John Moscow, former Assistant District Attorney in Manhattan and number two to the doyen of financial prosecutors, Robert Morgenthau, "everywhere is offshore to everywhere else."

That simple truth is the most important thing to remember about "offshore."

But it's an incomplete truth: within countries, states or specially designated regions provide "offshore" services.

Dubai's DFSC has broadly followed the model of Dublin's IFC - an offshore centre in name and legal structure only. There are many more examples: Malaysia's Labuan and the grand-daddy of them all, Delaware.

What turns these quasi-jurisdictions into quasi-offshore centres is the system of systems and laws that apply exclusively within them - and the fact that they offer specific services to non-residents.

The question of "offshore" is all too often linked with the critical term "tax haven." But this pejorative term is often as misleading as it is wrong. The Cayman Islands is not tax haven: it merely chooses to raise its national revenue through a system of duties and fees. Other places operate a duty-free environment but choose to tax income.

But it suits the OECD (which is dominated by high-tax economies) to claim, for example, "unfair tax competition," by which it means that a jurisdiction operates no- or -low tax on personal, corporate and trust income.

So does Florida. The OECD has made no criticism of Florida.

There is criticism of jurisdictions that provide facilities for limited corporate reporting: often they are said to be "secrecy jurisdictions." That would include Delaware, Nevada and the Dakotas.

There is frequent criticism of laws that provide for confidentiality of customer's affairs in banks. The USA has a particular bee in its bonnet about Spanish laws. The USA does not impose a legal duty of confidentiality on its financial institutions although under California law any release of confidential data must be disclosed to the customer who may take legal action in relation to that leak.

So, if everywhere can be regarded as offshore to someone, and offshore services are, generally, exactly the same services as can be provided by "onshore" financial services providers, what's the point?

The point is simply that the offshore world provides tax efficient structures for those who are legally entitled to take advantage of them. Whether those structures is legal is a matter for the taxpayer, although the USA, Australia, Germany and other countries are increasingly trying to establish that a person who sets up such structures where tax evasion results should be regarded as at least a conspirator.

The tag for this - and for ensuing applications for extradition - is based in a little known and little understood aspect of counter-money laundering laws. To understand this aspect, some explanation is needed:

a) for money to be laundered, it must be the proceeds of a "predicate crime" - that is criminal conduct which is specified as being conduct that generates "proceeds." Those proceeds may be in cash or other measure of money or in goods or some other form of tangible or intangible benefit. So the definition of "money" for money laundering purposes is much wider than the simplistic definition of notes and coin.

But each jurisdiction defines predicate crime differently; some use a list of specified offences, some include all crimes for which a specified minimum jail sentence may be applied ( for example, in Hong Kong, the minimum is offences for which a person may be sentenced to more than one year in jail) and in others, for example the UK, it is "all criminal conduct."

There is a difference between "crime" and "criminal conduct" - "crime" implies that a conviction is necessary; "criminal conduct" implies (and in some cases laws specifically confirm) that no conviction for a predicate crime is necessary in order to qualify the proceeds of that conduct as "laundered."

b) if conduct is illegal in both country A and country B, then possessing or dealing in the proceeds of that conduct in either country is regarded as laundering in both countries, even though the conduct itself took place in only one jurisdiction.

This is known as "commonality of offence." It is at the heart of extradition agreements - and cross-border investigations for money laundering.

Laundering offences include

a) having custody or control of the proceeds of criminal conduct

b) assisting another person to launder - and that includes the giving of advice or actively assisting in the creation or maintaining of a scheme.

It follows, then, that the services that the offshore sector offer - forming companies, trustee services, legal and tax advice, for example - expose those working in those sectors to risk.

Very few countries make it illegal for their citizens - individuals or corporations - to use offshore services in the sense of services in jurisdictions other than their own. However, many countries, including the USA and Australia, require their citizens to disclose offshore holdings.

In the case of the USA, Australia and Germany, for example, citizens are taxed on their worldwide income. Failure to declare income for tax purposes is a criminal offence.

The offence is deliberately simply phrased: in doing so it has wider application. The offence does not specifically refer to the declaring of offshore income.

In those offshore centres, such as Hong Kong, which has an income tax regime, there is an offence of failing to disclose income.

Therefore, it follows, that if a Hong Kong adviser assists a person from e.g. the USA to set up a scheme to hide income that the adviser is, prima facie, a conspirator in the predicate offence.

But because both the USA and Hong Kong have laws to combat money laundering, in substantially similar terms, the adviser is also, on the face of it, a money launderer - in this case not as a conspirator but as a principal.

Where countries are paired-off under extradition arrangements, this opens the door for the adviser to be arrested in his home jurisdiction and extradited to face trial.