HOW TO SET UP A BUSINESS IN BERMUDA

INTRODUCTION

Bermuda has always been deemed to be an attractive place due to its high living standards, low taxation, and ideal geographical location. It is also a well-known financial hub, especially in terms of insurance and reinsurance. The state also includes safe conditions, well trained labour force and developed facilities, thus making it a good place for the expansion of multinational companies. Starting a company in Bermuda presents a big chance for entrepreneurs as well as firms who wish to operate in such a business-friendly environment. With a predictable economy, integrated infrastructural facilities and favourable regulations in place, Bermuda has increasingly emerged as a centre for financial services along with investments and insurance.

STEP 1: DECIDE ON THE BUSINESS STRUCTURE

The nature of your business in Bermuda will in this case determine the legal framework you must adhere to and the level of business activities you can engage in. The following business forms are commonplace in the area:

• Exempted Companies: These are limited liability companies which were created to carry out international business outside the boundaries of Bermuda. These companies have been granted tax waivers and do not operate under Bermuda’s exchange control legislation.
• Local Companies: These are companies focusing on local operations in Bermuda. They are mostly owned by Bermudians and are bound to comply with conditions regarding ownership and operation.
• Partnerships: Both types of partnership, exempted and local, are available based on the scope of operations and ownership.
• Limited Liability Companies (“LLCs”): LLCs offer flexibility and limited liability and are commonly used by international businesses.

STEP 2: REGISTER THE COMPANY NAME

• As it were, the very first step is registering a name for a company. Your preferred business name will be checked for availability by the Registrar of Companies who will make sure your business name is not against the law.
• Some words may be restricted if they designate certain activities (e.g. “banking,” “insurance”).

STEP 3: INCORPORATION PROCESS

• Documents Required: Submission of the articles of incorporation of an international company which includes the company name, address, amount and class of shares, and the objects of the company.
• Approval Process: Once the documents are submitted, the Registrar of Companies reviews them. For exempted companies, you will need a licensed local corporate service provider to facilitate the process.
• Timeline: This is normally a period of 1-2 weeks, depending on how complicated the application is and how many documents are filed.

STEP 4: OBTAIN NECESSARY LICENSES AND PERMITS

As is common with other jurisdictions, some licenses and permits will be required depending on the sector you operate in. For instance, businesses dealing with finance must be licensed by the Bermuda Monetary Authority (“BMA”). Other requirements may include environmental and building licenses and special business licenses, which depend on the type of the business.

STEP 5:  SECURE OFFICE SPACE AND SET UP OPERATIONS

• Real Estate and Leasing: There are several business offices and large corporate offices that are available in Bermuda. The price range is quite high; however, the variety does help looking for one that fits the scale of your business.
• Utilities and Telecommunications: The level of infrastructure development in Bermuda is advanced as there is availability of essential services and access to the internet of high speed.

STEP 6: HIRE LOCAL TALENT

• Workforce Availability: Highly skilled workforce can be found in Bermuda s financial and related services. One such industry is construction and is said to be skilled labour and therefore we will have to apply for the work permits.
• Work Permits: Work Permit is a legislation document that allows foreigners to work in a host country. Work permits are obtained for specific employment for 1 to 5 years and are usually employer sponsored.

STEP 7: BANKING AND FINANCING SETUP

• Corporate Bank Accounts: There are some essential processes that are mandatory to open a corporate account in Bermuda. The business that is seeking to open a corporate account gives out the address, the directors, and an operational business plan.
• Tax Benefits: Business entities with interests in international business are encouraged to set base in Bermuda due to its zero rates on corporation tax, capital gain tax, and Value Added Tax (“VAT”).

STEP 8: UNDERSTAND COMPLIANCE AND REPORTING REQUIREMENT

• Annual Filings: Companies are obliged to submit annual returns and financial statements with the Registrar of Companies.
• Anti-Money Laundering (“AML”) and Regulatory Compliance: Bermuda possesses powerful anti-money laundering laws & regulations. All financial services and businesses which are involved in any regulated activities are required to establish compliance resources or measures.

CONCLUSION

Bermuda presents an attractive business environment as it can lead to a several promising opportunities. Although the requirements may appear to be rigorous, they are not unusual for international business. Following the steps mentioned here and forming partnerships with local specialists will lay a good foundation for your business endeavour in the British Island.