Bermuda Economic Substance Filings - Update

Industry Notices
In relation to the Economic Substance Act 2018 (the “Act”) and the related Guidance Notes issued by the Minister of Finance on 24 December 2019 (the “Guidance Notes”), the Registrar of Companies has prepared draft supplemental schedules to the Guidance Notes providing additional sector-specific guidance in relation to each of the relevant activities set out in the Act (the "Sector-Specific Guidance").

The draft Sector-Specific Guidance remains subject in all respects to review by the EU Code of Conduct Group on Business Taxation (the “Code Group”), and by the OECD Forum on Harmful Tax Practices (“FHTP”), and the Registrar of Companies is actively engaged with both for that purpose.

Subject to any comments received from either of the Code Group or FHTP, and to any comments received from industry, it is expected that the Sector-Specific Guidance will be issued by the Minister of Finance later this year.

The Registrar of Companies has also issued an industry notice acknowledging the challenges of business continuity in the context of COVID-19, and indicating that the Registrar would take into account circumstances where meetings or other similar compliance measures that are required under the Act and the Economic Substance Regulations 2018, as amended (the "Bermuda ES Laws") are not possible due to necessary travel or quarantine restrictions. Entities are reminded that they should keep careful records of all applicable circumstances and should continue in good faith to ensure ongoing compliance with the Bermuda ES Laws.

Economic Substance Filing Portal
For an overview of the requirements of the Bermuda ES Laws and which 'relevant activities' are caught, please refer to Walkers' advisory.

Entities that are conducting a 'relevant activity' and entities that are claiming 'non-resident entity' status under the Bermuda ES Laws, in each case, in respect of the financial period from 1 January 2019 to 31 December 2019, are reminded that they are obliged to file their economic substance declarations as required under the Bermuda ES Laws or to assert such claims on or before 30 June 2020.

The Registrar of Companies will be launching its online portal for filing electronic substance declarations and claims for non-resident entity status under the Act with effect on 1 May 2020 and entities or their authorised representatives will be able to submit their filings from that date.

Melanie FullertonSenior AssociateT +1 441 242
Samantha Kyme Vice PresidentT +1 441 242 1527
Kim ArmstrongTeam Manager, Corporate ServicesT +1 441 242