Bermuda: Company Migration To And From Bermuda

Last Updated: 24 September 2018
Article by Jonathan Betts

MIGRATION TO BERMUDA

The Companies Act 1981 of Bermuda (the "Companies Act") permits a body corporate incorporated outside Bermuda (the "foreign corporation") to be continued in Bermuda by way of continuation as an exempted company under the Companies Act (the "Registrant").

Pre-conditions to registration

The Registrant must:

  1. obtain all necessary authorisations, if any, required under the laws of the jurisdiction in which it is presently registered in order to enable it to continue as an exempted company registered in Bermuda;
  2. make an application to the Bermuda Monetary Authority ("BMA") accompanied by:

    1. a statement of the proposed business of the exempted company;
    2. information concerning the beneficial owners of the exempted company; and
    3. a legal opinion of foreign counsel in the jurisdiction from which the Registrant is discontinuing, and
  1. provide financial statements prepared for a period ending within twelve months of the proposed date of continuance.

The BMA will grant the relevant consent where these conditions are met.

Process of continuation to Bermuda

On satisfaction of the pre-conditions to registration, the Registrant must make an application for registration accompanied by:

  1. the original signed memorandum of continuance;
  2. the legal opinion issued by the foreign counsel; and
  3. the relevant government fee and filing fee to the Registrar of Companies in Bermuda (the "Registrar").

The Registrar will register the memorandum of continuance and issue a certificate of continuance if they are satisfied that the Registrant is in compliance with the Companies Act. The Registrant should forward a copy of the certificate of continuance to the competent authority in the country or jurisdiction from which it has been continued.

On completion of these steps, the Registrant will become an exempted company to which the Companies Act and any other laws of Bermuda apply as if it had been incorporated in Bermuda on the date of the registration of the memorandum of continuance. The memorandum of continuance will then be deemed to be the memorandum of association of the Registrant in lieu of its original, re-stated or amended memorandum of association, articles of incorporation or other constituting documents.

The continued company must, as soon as practicable from the date of continuation in Bermuda, ensure that it has adopted bye-laws which conform to the requirements of the Companies Act.

Effect of continuation in Bermuda

The registration of the continuance of a foreign corporation will not be deemed to create a new legal entity or prejudice or affect the continuity of the body corporate which was formerly a foreign corporation and has now become an exempted company continued in Bermuda. For example:

  1. The property of the foreign corporation continues to be the property of the continued company.
  2. The continued company continues to be liable for its obligations predating its registration as a Bermuda exempted company.
  3. Any existing cause of action, claim or liability to prosecution in respect of the foreign corporation is unaffected; any civil, criminal or administrative action or proceeding pending by or against the foreign corporation may be continued by or against the continued company.
  4. Any conviction against, or any ruling, order or judgment in favour of or against the foreign corporation may be enforced by or against the continued company.

Whilst the continued company remains liable for its obligations when it was a foreign corporation, the Companies Act is silent on the priority of any secured obligations of the continued company. It would be advisable for any secured party of the continued company to file an application with the Registrar to register any security created in the register of charges as maintained by the Registrar (the "Register of Charges"). Upon filing, that security will have priority over any other security interests which are subsequently registered in the Register of Charges and any unregistered charges in respect of that security.

DISCONTINUATION FROM BERMUDA

An exempted company may be discontinued under the Companies Act and be continued in a jurisdiction outside Bermuda as if it had been incorporated under the laws of that other jurisdiction. The jurisdiction in which such exempted company is to be continued must be an "appointed jurisdiction" or approved, upon specific application, by the Minister of Finance in Bermuda.

Unlike for a foreign corporation continuing into Bermuda, consent from the BMA is generally not required. However, the discontinuance must be approved in such manner as may be authorised by the bye-laws of the exempted company and it must be completed in accordance with the Companies Act.

Pre-conditions to de-registration

Before discontinuance can take place the exempted company must provide:

  1. a resolution of the members approving the discontinuance;
  2. a statutory declaration, signed by a director of the exempted company, stating that the exempted company is solvent and can meet all of its liabilities and obligations, and that the discontinuance will not adversely affect the interests or rights of bona fide creditors and members;
  3. an irrevocable deed poll stating that:

    1. the exempted company and each of its directors may be served with legal process in Bermuda in any proceedings arising out of actions or omissions of the company prior to the discontinuance;
    2. provision has been made for the appointment of a person within Bermuda as agent for the exempted company for the service of process for a period of no fewer than three years from the date of discontinuance (a copy of the signed acceptance of the appointment should be appended to the deed poll); or
    3. the exempted company and each of its directors may be served with legal process at a specified address in the United Kingdom, the United States of America or any "appointed jurisdiction", and the exempted company and its directors submit to the non-exclusive jurisdiction of the courts of that country or jurisdiction.

At least fourteen days prior to the discontinuance, the exempted company must give notice, in an appointed newspaper in Bermuda and in a national newspaper in each jurisdiction within which it carries on a substantial part of its business, of its intention to discontinue in Bermuda and its proposal to continue in the named jurisdiction.

Documents to be filed on discontinuance

The exempted company seeking discontinuance must file with the Registrar a notice of the discontinuance together with the following:

  1. confirmation of the effective date of the discontinuance;
  2. the name of the jurisdiction in which the exempted company will continue;
  3. the address of the registered office or the principal business address of the exempted company in the jurisdiction in which the company will continue;
  4. a copy of the statutory declaration; and
  5. a copy of the irrevocable deed poll.

The exempted company also needs to file with the Registrar a copy of the instrument of continuance issued to such company by the appropriate authority of the jurisdiction into which the exempted company is to be continued, or, if no such instrument of continuance is issued, such other documentary evidence of continuance as such authority issues, within 30 days of receipt of such certificate or other documentary evidence ("Evidence of Continuance").

On receipt of the copy of the Evidence of Continuance, the Registrar will file that instrument or document and issue a certificate of discontinuance. The effective date of discontinuance will be the date of continuance in the other jurisdiction. The discontinuance does not create a new legal entity, or prejudice or affect the continuity of the body corporate which was formerly a Bermuda exempted company.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions