December 18, 2024
INCORPORATION OF LLC IN BERMUDA
A Limited liability company (“LLC”) is a business structure that combines the characteristics of a corporation and a partnership. It offers limited liability protection to its owners, known as members, like a corporation. This means that the members’ personal assets are generally shielded from the company’s debts and liabilities. Additionally, LLCs are often easier to form and maintain than corporations, and they may offer more tax benefits, such as pass-through taxation.
The introduction of LLCs in Bermuda marks a significant step forward, offering a versatile and advantageous business structure for both domestic and international entities. With strong ties with the U.S.A, Bermuda recognized the need for a flexible business structure such as an LLC and responded by creating this new option. The LLC Legislation of Bermuda is closely aligned with Delaware Legislation.
There are two main types of Bermuda LLCs: local LLCs, which are formed by most Bermudians to do business in Bermuda, and exempted LLCs, which are formed by non-Bermudas to do business. Businesses outside Bermuda. The term “exempted LLCs means an LLC that is not subject to the requirements under the Limited Liability Companies Act in which Bermudians hold at least 60% of the capital.
WHY CHOOSE BERMUDA LLC?
Bermuda offers many advantages to LLCs, including a tax neutral environment with no corporate, income, capital gains or inheritance taxes. Strict privacy laws protect the privacy of LLC members as separate legal entities and protect members from personal liability. Members may perform fiduciary duties as required. These organizations are flexible in management and operation. Additionally, they can be created with just one member and do not require a minimum authorized capital. The integration process is simple and cost-effective.
PROCEDURE FOR INCORPORATION OF LOCAL LLCs
- Name Reservation: Securing a unique name for your LLC from registrar of company.
- Beneficial Owner Disclosure: Identifying and verifying the individuals who own 10% or more of LLC.
- Submitting necessary declarations LLC Agreement: Drafting a legal document outlining the company’s structure, operations, and ownership.
- Licensing and Permits: Applying for any required licenses or permit based on your business activities.
- Registered Office: Selecting a local address for official correspondence.
- Resident Representative: Appointing a local representative if necessary.
- Government Fees: Paying the prescribed government fees.
PROCEDURE FOR INCORPORATION OF EXEMPTED LLCs
- Obtain BMA Consent: Secure consent from the Bermuda Monetary Authority (“BMA”).
- Prepare Certificate of Formation: Draft a certificate of formation specifying the LLC’s name, type (exempted), registered office address, and any other relevant details.
- File with the Registrar: Submit the certificate of formation, along with the BMA’s consent, to the Registrar of Companies and pay the required fees.
- Receive Certificate of Filing: Upon successful filing, the Registrar will issue a certificate of filing.
CRITICAL CONSIDERATION
Regulatory Compliance: Meet Bermuda’s ongoing regulatory requirements. This includes filing annual returns and maintaining accurate company records.
Financial Reporting: Although Bermuda does not set specific financial reporting standards, but it is advisable to maintain accurate financial records for internal purposes and potential audits.
Bank Accounts: Open a corporate bank account in Bermuda to facilitate your business operations.
CONCLUSION
Bermuda offers an attractive proposition for businesses looking for a strong, tax-efficient jurisdiction for LLCs. A favorable tax regime. Strong legal framework and commitment to privacy This makes it an attractive destination for local and international companies.
By carefully navigating the incorporation process and following regulatory requirements, businesses can reap the benefits of Bermuda LLC, including asset protection. Operational flexibility and global business opportunities.
HOW WE CAN HELP?
We offer expert services to guide you through every step of the LLC registration process in Bermuda.
Our team can oversee the complete LLC registration procedure, including name reservation and drafting.
For more information or queries, please email us at
[email protected]
Key Contact
Surendra Singh Chandrawat
Managing Partner
