Bermuda

A group of islands in the northwest Atlantic Ocean on the east coast of South Carolina (USA).

Capital

Hamilton

Official language

English

Currency

Bermuda dollar (BMD)

Form of Government

British self-governing overseas territory. Governor who is appointed by the British monarch manages matters of foreign policy and defense. Since 1968 Bermuda has its own constitution. The Head of Government is Prime Minister. Legislative power is vested in a bicameral parliament of Westminster-type (Senate and Assembly).

Economy

The economy is based on providing international financial services (primarily insurance, reinsurance, investment funds and special-purpose companies - SPV), and tourism which is the second source of the county's income. The industrial sector is concentrated in construction and agriculture, but only 20% of the land is arable. 80% of food has to be imported to Bermuda from overseas.

Legal system

Own legislation based on English common law.

Corporate law

  • Companies Amendment Act 2006 
  • International Businesses (Stamp Duty Relief) Act 1990, amended in 1993
  • Overseas Partnerships Amendment Act 2005
  • Exempted Partnerships Amendment Act 2005
  • Trusts (Regulation of Trust Business) Act 2001
  • Trust Companies Act 1991
  • Investment Funds Act 2006

Types of companies

  • Exempt Company
  • Local Company Limited by Shares
  • "Permit" Company
  • Limited Partnership
  • Exempt Partnership
  • Overseas Partnership
  • Trust

Exempt Company

Exempt Companies are used for international trade and investment, because all other types of companies must belong to residents of Bermuda for at least 60%.

  • the company is registered under the Companies Act 1981 as amended in 2006;
  • information on beneficial owners of the company is disclosed to authorized entities, but under a special law this information may not be publicly available;
  • it is enough to have a single shareholder;
  • a registered office shall be in Bermuda and company documents shall be stored there;
  • the company must have at least either two resident directors or resident secretary and resident director or resident secretary and resident "permanent representative", director and secretary shall be natural persons;
  • there is no requirement on the amount of the minimum authorized capital; the usual minimum authorized share capital is 12 000 USD, the minimum issued and paid-up share capital is 1 USD; the the annual fee for the company depends on the amount of the authorized share capital;
  • the company has no right to do business and own property in the territory of Bermuda;
  • the company has the right to do the following types of activities only if it has a license: banking, insurance and reinsurance business, fund management, collective investments, advising on investments or any other activity that accompanies banking or insurance services.

Taxation

There is no capital gains tax, income tax, VAT and sales tax. Exempted company may apply to the Ministry of Finance for obtaining a certificate of exemption from taxation of their future income in the period up to March 26, 2035 (this period sometimes revised upwards) in case taxes will still be introduced.

Agreements on avoidance of double taxation

The country does not enter into any Agreements on avoidance of double taxation. However, there is an agreement with the U.S. which exempts insurance premium payments from the franchise tax of U.S. states and ensures tax incentives to American companies that have contracts in Bermuda. Agreements on tax information exchange (TIEA) are entered into With a number of countries.