On 1 August 2012, the Bermuda Government passed the Corporate Service Provider Business Act 2012 (the "Act"). The Act regulates corporate service providers servicing clients of Bermuda who establish and maintain companies and partnerships on the island. The Act came into operation on 1 January 2013, with a transition period of 12 months.
Appleby Services (Bermuda) Ltd. ("ASBL") is a leading corporate service provider on the island and will be applying to become a licensed corporate service provider under the Act.
ASBL welcomes the licensing and ongoing regulation of the business of corporate service providers by the Bermuda Monetary Authority (the "BMA"). Not only does this step reinforce Bermuda's reputation as a robust and well-regulated jurisdiction, this Act also paves the way for the streamlining of certain procedures, such as the processes of incorporating companies, establishing partnerships and transferring shares.
Under the Act, corporate service provider business is defined as the provision for profit of such services as:
- The incorporation of companies or the establishment of partnerships
- Nominee services, including the provision of nominee shareholders
- The provision of a registered office
- The provision of an accommodation, correspondence or administrative address
- The maintenance of the books and records of a company or partnership
- The filing of statutory forms, resolutions, returns and notices
- Acting as a director, officer, secretary, alternate, assistant or deputy secretary of a company or an officer of a partnership
The BMA is drafting guidance under the Act on the appropriate levels of client due diligence to apply, with the goal of being aligned with established best practice in other highly-regulated onshore and offshore jurisdictions. It is anticipated that these changes will significantly improve the efficiency and effectiveness of Bermuda as a competitive jurisdiction for international business.
Corporate service clients of ASBL will not be directly impacted by the Act as it regulates ASBL rather than its clients.
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