A company limited by guarantee has the liability of its members limited by its memorandum to the amount each undertakes to contribute if the company is wound up. It may only be formed for the purposes set out in section 5(3) of the Companies Act 1981.
At A Glance
| Governing legislation | Companies Act 1981, sections 5(2)(b), 5(3), 6(4) and 9 |
| Separate legal person | Yes, from the date of registration |
| Liability of owners | Limited to the amount each member guarantees |
| Local or exempted | Either |
| Name must end in | “Limited” or "Ltd., unless the Minister licenses its omission under section 9 |
| Evidence of creation | Certificate of incorporation |
Key Features
A guarantee company is a body corporate in the same way as a company limited by shares. It has no share capital. Its members do not pay for shares; they undertake to contribute a stated amount if the company is wound up.
It may only be formed for restricted purposes
A company limited by guarantee may only be formed where its purpose is to promote art, science, religion, charity, sport, education or another social or useful purpose, its profits are applied to those purposes and no dividends are paid to members; or where it is a mutual company; or where it is exempted under an order made under section 10(2) of the Trusts (Regulation of Trust Business) Act 2001. If the Registrar is of the opinion that the purpose is not one of these, the Registrar must refuse to register it.
Omitting “Limited” from the name
Where the Minister is satisfied that the company is for promoting art, science, religion, charity, sport or another useful object, and its constitution applies profits to those objects, prohibits dividends and distributions to members, and requires assets on a winding up to pass to a body with similar objects, the Minister may license it to be registered without “Limited” in its name.
Who can own one
A company limited by guarantee has members rather than shareholders. Each member undertakes to contribute a stated amount to the assets of the company if it is wound up, and that undertaking is the limit of their liability. There is no share capital, and no dividends are paid to members.
A guarantee company may be local or exempted, and the memorandum must state which. A local guarantee company must be controlled by Bermudians or hold a license from the Minister.
RELATED
Local and exempted entities explained →
The Bermudian ownership requirement →
How to register one
- Reserve a name. Reserving a name →
- Prepare your memorandum of association on Form 2a, or Form 2b if the company is a mutual company. Preparing a memorandum of association →
- Disclose your proposed beneficial owners.
- Apply for a license under section 9, if you want to omit “Limited” from the name.
- File and pay. Registration fees and how to pay →
What we issue
A certificate of incorporation showing the date of registration, with a facsimile of your memorandum attached. No defect in the formalities leading up to incorporation affects its validity, and the certificate is conclusive evidence of due incorporation and of the date.
Where the Minister has licensed the company under section 9 to be registered without “Limited” in its name, the certificate is issued in the licensed name.
Records you must keep
- a register of members
- a register of directors and officers
- minutes of proceedings, and books of account
These are kept at your registered office in Bermuda, which may not be a post office box. The register of members and the register of directors and officers are open to inspection there.
Beneficial ownership obligations
Every Bermuda company is subject to the Beneficial Ownership Act 2025. You must take reasonable steps to identify any individual who owns or controls twenty-five per cent or more of the interests or voting rights, or who otherwise exercises ultimate effective control; verify their identity against a reliable and independent source before entering them on your register; maintain a beneficial ownership register; file the required information with us; and update it within fourteen days of being notified of a change.
RELATED
The beneficial ownership regime: an overview →
What information about this entity is public
A search of the register returns the registered office address, the memorandum of association, the date of registration, information on charges and previous names. Bermuda's central register of beneficial ownership is not public
RELATED
Who can access beneficial ownership Information →
Ongoing obligations
A local company limited by guarantee that is not a mutual company pays no annual fee. All other obligations, including the annual declaration, apply as for any other company.
Legislation
Companies Act 1981 |1981 : 59 · External link