Section 156A of the Companies Act 1981 defines a mutual fund as a company limited by shares, or other company having a share capital, incorporated for the purpose of investing the moneys of its members for their mutual benefit, having the power to redeem or purchase for cancellation its own shares without reducing its authorized share capital, and stating in its memorandum that it is a mutual fund.
At A Glance
| Governing legislation | Companies Act 1981, Part XIIA, sections 156A to 156P |
| Separate legal person | Yes. It is a company limited by shares |
| Liability of owners | Limited to the amount unpaid on their shares |
| Local or exempted | both, usually exempted |
| Name must end in | “Limited”, subject to section 9 |
| Evidence of creation | Certificate of incorporation |
Key Features
A mutual fund is not a separate legal form
It is a company limited by shares that has made the required statement in its memorandum. It is created, and its ownership is recorded, in exactly the way described for companies limited by shares. The designation determines how the company may deal with its own shares, and brings it within Part XIIA.
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Regulation is separate from legal form
Investment funds are authorized, registered or classified by the Bermuda Monetary Authority under the Investment Funds Act 2006. That regime is a supervisory overlay and does not create a legal person. A Bermuda fund may equally be structured as a limited liability company or a limited partnership.
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How to register one
- Reserve a name. Reserving a name →
- Prepare your memorandum of association, which must state that the company is a mutual fund. Preparing a memorandum of association →
- Disclose your proposed beneficial owners, with personal declarations where required.
- Choose a registered office and appoint your officers. Choosing a registered office and resident representative →
- File and pay. Registration fees and how to pay →
Registering with us is not authorization to operate as a fund
Authorization, registration, classification or exemption under the Investment Funds Act 2006 is a separate matter for the Bermuda Monetary Authority, and is dealt with once the company exists.
Records you must keep
- a register of members
- a register of directors and officers
- minutes of proceedings, and books of account
These are the records every company limited by shares keeps. Anything the Bermuda Monetary Authority requires under the fund regime is additional to them, not a substitute for them.
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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 thirty days of being notified of a change.
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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.
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Who can access beneficial ownership Information →
Legislation
Companies Act 1981 |1981 : 59 · External link
Investment Funds Act 2006 | 2006 : 37 · External link