Bermuda has been returned to the European Union’s (EU) ‘white list’ of fully cooperative tax jurisdictions, having previously been blacklisted in March 2019.
The island nation and global re/insurance hub was removed from the blacklist in May after implementing commitments to address concerns about its tax transparency.
But until now it had still been on the EU’s ‘grey list’ of jurisdictions that still needed to complete further positive steps.
The Bermuda Business Development Agency (BDA) said that the private sector has worked collaboratively with government officials, alongside the Bermuda Monetary Authority (BMA), to implement reforms specifically relating to collective investment vehicles (CIVs).
Additionally, Bermuda’s Economic Substance Amendment (No. 2) Act 2019 came into effect at the start of 2020 to address EU requirements.
“This outcome is testament to Bermuda’s commitment to meet and exceed the highest international standards of regulatory compliance and economic substance,” said Roland Andy Burrows, CEO of the BDA.
“Combined with our world-leading achievements in the Financial Action Task Force assessment, together with Bermuda’s EU Solvency II equivalence and status as a NAIC Reciprocal Jurisdiction in the U.S., Bermuda’s blue-chip transparency and outstanding offering to global business is second to none,” he continued. “I thank Bermuda’s government, regulator and all our industry stakeholders for continuing to ensure Bermuda maintains its world-class regime.”
The EU agreed to begin compiling its list of non-cooperative jurisdictions in December 2017 to prevent tax avoidance and promote good governance principles such as tax transparency, fair taxation or international standards against tax base erosion and profit shifting.
Jurisdictions on the list can potentially incur a set of countermeasures from EU member states, including increased monitoring and audits, withholding taxes, special documentation requirements and anti-abuse provisions.
“ECONFIN’s decision is a positive step that will benefit consumers and communities worldwide, reinforcing their efficient, level playing field access to the Bermuda’s unrivaled risk management expertise and substantial financial capacity,” said Stephen Weinstein, Deputy Chair of the BDA.
“We appreciate the efforts of Bermuda government officials, from the Cabinet to the professional staff of its world class agencies, who have engaged to educate global stakeholders regarding Bermuda’s regulatory standards and market practices.”
John Huff, President and CEO, Association of Bermuda Insurers and Reinsurers (ABIR), further stated: “The Bermuda Monetary Authority, Bermuda Finance Minister, Bermuda government and Bermuda business community once again demonstrate internationally-recognised regulatory enforcement.”
“From EU Solvency II equivalence, U.S. Reciprocal Jurisdiction status, Financial Action Task Force compliant anti-money laundering regime and now EU Economic Finance ‘white list’ designation recognising Bermuda’s solid work on EU tax good governance and our economic substance framework, Bermuda’s robust regulatory environment is world-class.”
“BILTIR is very pleased with the announcement today that Bermuda is officially off of the EU’s Economic and Financial Affairs Council (ECOFIN) ‘grey list’,” added Ronnie Klein, Executive Director, Bermuda International Long Term Insurers and Reinsurers (BILTIR).
“We applaud the Council’s reasonable approach of using facts to make its decision. Along with recent affirmations of being NAIC qualified, Solvency II equivalent and a leader in the fight against anti-money laundering, Bermuda continues to shine as a beacon for the growing life insurance and reinsurance sector.”
