Alerts

  • The Ministry of Tourism, Transport and Municipalities has implemented the 10 knot speed limit to reduce excessive speed in the confines of the Hamilton Harbour which will go into effect Friday, 19 May, 2017.

Alerts

  • The Department of Parks advises that camping registration will open on 8 May for the 15 May - 30 September camping season. Permits can be collected at the Department of Parks, Ground Floor, Global House, 43 Church Street. Camping rate: $14 per night.

The Bermuda Business Centre

Transparency

  • OECD Common Reporting Standard is in effect from 2016, with 2017 reporting.
  • OECD Country-by-Country Reporting has been adopted for 2016, with 2017 reporting.
  • Model 2 intergovernmental agreement signed with the US to facilitate FATCA
  • Beneficial Ownership information exchange with competent international authorities.
  • Early adopter of the OECD Convention on Automatic Exchange of Information.

OECD Common Reporting Standard (CRS)

  • Bermuda is one of the first countries which committed to adoption of the CRS. As a result, Bermuda’s financial institutions must be compliant with the CRS due diligence and necessary information requirements as of 1 January 2016 for any new accounts.
  • As an early adopter jurisdiction, Bermuda intends to participate in the first information exchange with other CRS participating jurisdictions by September 2017.

OECD Country by Country Reporting

  • Bermuda became the 33rd signatory of the Multilateral Competent Authority Agreement for the automatic exchange of Country-by-Country reports (CbC MCAA), which is based on Article 6 of the Multilateral Convention on Mutual Administrative Assistance in Tax Matters and puts in place the automatic exchange framework for exchanging Country-by-Country Reports, as contemplated by BEPS Action 13.
  • Under the CbC MCAA, tax administrations where a company operates will get aggregate information annually, starting with 2016 accounts, relating to the global allocation of income and taxes paid, together with other indicators of the location of economic activity within a multinational enterprise group. It will also cover information about which entities do business in a particular jurisdiction and the business activities each entity engages in.
  • The information will be collected by the country of residence of the parent of the MNE group, and will then be exchanged in accordance with the agreements now also signed by Bermuda. First exchanges will start in 2017-2018 on 2016 information. In case information fails to be exchanged, the BEPS Action 13 report provides for alternative filing so that the playing field is levelled.

US FATCA

  • On  19 December  2013,  Bermuda  signed  an  IGA  Model  2  with  the  U.S. to implement  U.S. FATCA.  Under an IGA Model 2 the U.S. and the FATCA partner enter into an IGA whereby the FATCA partner would agree to implement legislation to direct and enable FFIs in its jurisdiction to collect and report FATCA required information (including Specified U.S. Persons) directly to the IRS. It is important to note Bermuda law already enables FFIs in its jurisdiction to collect and report FATCA required information directly to the IRS, as there is no Bermuda law conflict that prevents FFIs from doing so, unlike in those countries that do have conflicting laws that do not enable FFIs to report directly to the IRS and therefore had to adopt IGA Model 1. Hence in Bermuda’s case Bermuda only needs to amend its law so as to direct FFIs in its jurisdiction to abide by the US’s FATCA Regulations as may be modified by the IGA Model 2 and to impose a fine and or penalty if the FFIs do not, whereby such fine and or penalty is sufficient to serve as a deterrent to non-compliance.  The IGA Model 2 to implement FATCA is primarily aimed for use by those FATCA partners that have little or no local law conflicts with FATCA and where substantial local legislation is not required.
  • IGA  Model  2  provides  that FFIs  in  such  FATCA  partnerships  enter  into  a  FFI agreement  with  the  IRS.  Such FFI agreements introduce obligations that are similar to  the obligations on FFIs under an IGA Model 1 who comply with the IRS registration requirement.

Beneficial Ownership Registry and Information Sharing

  • Bermuda remains at the forefront of the issue of beneficial ownership having maintained an accessible register of the beneficial owners of all Bermuda companies since the end of World War Two.
  • Information on the Bermuda list is available to any competent authority pursuing legitimate enquiries of the affairs of its citizens.  
  • A requirement of the Bermuda Government which dates back to the 1940s included a mandate that required the disclosure of the proposed ultimate beneficial owners of a prospective business at the time of application. The applicants must make the information available to central authorities, which today is the Bermuda Monetary Authority.
  • Bermuda has an agreement with the British National Crime Agency (NCA) to share beneficial ownership data held in Bermuda with the NCA with a turnaround time of 24 hours, and on an emergency basis a turnaround time of one hour. 

International Cooperation

Internationally Accredited Regulation

NAIC Qualified Jurisdiction

  • Bermuda was established on the first list of Qualified Jurisdictions of the National Association of Insurance Commissioners (NAIC) as of 1 January 2015 - applicable to (re)insurers licensed as Class 3A, Class 3B and Class 4, and Long-Term insurers of Class C, Class D and Class E.
  • This encourages cross-border operations of Bermuda reinsurers with the US insurance market. The impact of this trade is to expand US reinsurance capacity and make markets more competitive. 
  • The NAIC is the US standard-setting and regulatory support organisation created and governed by the country’s chief insurance regulators from the 50 US States, District of Columbia and five US territories.  The NAIC conducted a comprehensive review of Bermuda insurance regulatory law and regulation and assessed the resources of the BMA prior to making a determination that Bermuda could be qualified.  Today only seven jurisdictions have been found qualified (Bermuda, France, Germany, Ireland, Japan, Switzerland and the United Kingdom).  As a result of this status the NAIC also has a technical financial evaluation team that assesses the prudential standard for reinsurers desiring to conduct business with US insurers on a cross border basis.   Reinsurers that pass this test become “certified” to do business with reduced regulatory collateral to secure their US liabilities.
  • Bermuda-domiciled reinsurers licensed in the above classes will be eligible to be certified for reduced reinsurance collateral requirements under the NAIC's Credit for Reinsurance Model Law.

EU Solvency II Equivalent

  • Bermuda’s enhanced commercial insurance regulatory regime reached full equivalence on 24 March 2016 following a multi-year effort led by the Bermuda Monetary Authority, and supported by public and private sector stakeholders. A Delegated Act recommending full equivalence for Bermuda was adopted by the EC on 26 November 2015, following which the European Parliament (EP) and Council were entitled to object to the EC decision for a three-month period. No objections were received.
  • In the Delegated Act, the EC announced its approval of Bermuda’s commercial (re)insurance regime which it accepted as being fully equivalent to regulatory standards applied under Solvency II. There are three elements of equivalency which were granted to Bermuda, the most important of which are recognition of the standing of the BMA as a group supervisor for international insurance groups; and the standing of the BMA as a regulator of reinsurers conducting cross border trade with EU insurers.
  • The Delegated Act entered into force on 24 March and was applied retroactively to 1 January 2016.
  • This action followed a comprehensive assessment by EU jurisdictional regulars of Bermuda law and regulation and BMA resources.  Bermuda is only of only two jurisdictions, the other being Switzerland, which have been found to be fully equivalent.

International Standards in Banking

  • Banks licensed in Bermuda are required to comply with the framework set out in the Bermuda Monetary Authority’s final rules and guidance, which reflect the regulatory standards designed and set out by the Basel Committee, the international standard-setting body for banks. 
  • Effective 1 January 2015 the Bermuda Monetary Authority issued its final rule on Basel III for Bermuda banks, thereby adopting the capital and liquidity regulatory requirements consistent with the more comprehensive and strengthened set of standards agreed by the Basel Committee in 2010. The adoption by Bermuda of Basel III represents its alignment to current international standards.

FATF Recommendations

  • Bermuda is a member of the Caribbean Financial Action Task Force (CFATF) set up specifically to combat money laundering and terrorist financing in the Caribbean region. The Government of Bermuda is committed to an Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) regime to reflect the revised international standards from the Financial Action Task Force (FATF) on Combating Money Laundering and the Financing of Terrorism and Proliferation. 
  • The Government’s commitment is evidenced by the important contributions Bermuda continues to make at CFATF and FATF working group and plenary meetings, and key leadership that Bermuda has taken at CFATF. Bermuda has served as Chair of the first FATF and CFATF joint typologies project on Money Laundering and Terrorist Financing using Trust and Corporate Service Providers, and Co-Chair of the CFATF Working Group on FATF Initiatives.  Furthermore, Bermuda is a member of CFATF’s Steering Group (as representative for the Overseas Territories), and is a member of its Audit and Budget Committee.
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