This is the second article in our series on Bermuda’s proposed Competition Act 2026. Our first, Competition Law Sails into Bermuda, considered the parliamentary background leading to the consultation process which has just concluded. This article examines the regime proposed in the Government’s August 2026 consultation paper, Promoting Competition and Market Fairness.[1]
Competition and Regulatory Authority
The centrepiece of the proposed framework is the transformation of the existing Regulatory Authority into the Competition and Regulatory Authority (CRA). Whilst continuing to perform its existing sector-specific regulatory functions, the CRA is set to become a comprehensive market regulator, with new investigative, adjudicative and enforcement powers.
The CRA would investigate anti-competitive conduct, review mergers and acquisitions, issue decisions and impose remedies (including civil penalties). It would have the power to issue interim measures pending completion of an investigation where there is suspicion of a breach, and the power to suspend commercial arrangements temporarily pending investigation.
The CRA would publish its regulatory decisions and findings. Whilst intended to promote transparency, publication may prove just as significant in creating a body of precedents that would, over time, provide guidance as to how the legislation is interpreted in practice.
Prohibited conduct
As noted in our previous article, the new regime would focus on harmful conduct rather than market position.
The prohibitions would cover a range of harmful conduct from anti-competitive agreements to unilateral conduct that harms competition. A range of practices could attract regulatory scrutiny, including price fixing, bid rigging, market allocation, collusion, predatory pricing and blocking market entry. Of particular concern for the government is to prohibit abuse of dominant position, including tying arrangements (i.e. channelling consumers to affiliated entities or only one provider).
The Competition Act 2026 would not provide for unwinding existing dominant market participants or mandate divestitures. The emphasis instead is on regulating how market power is exercised. It remains to be seen whether this approach will be sufficient to address the effects of lack of competition.
Merger control
A significant development for the jurisdiction is the introduction of pre-closing merger reviews, with the CRA to be empowered to approve, impose conditions on, and prohibit transactions.
CRA approval could be required for mergers or acquisitions in seven “essential sectors” where the combined business would hold at least 40 per cent of the market:
- food and grocery retail;
- fuel and energy;
- health insurance;
- health-service provision, including primary, specialist, hospital and pharmacy services;
- pharmaceutical importation and distribution;
- construction materials; and
- stevedoring and port services.
Notably, the CRA would have transitional powers to review retroactively pre-Competition Act mergers so long as such reviews take place within one year of the legislation’s effective date. CRA’s powers with respect to past mergers would be limited to undertakings and behavioural directions, and not divesture or financial penalties.
What remains unclear is the standard against which transactions would be assessed, as the test for CRA intervention has not yet been articulated.
Market studies
The CRA will also be mandated to study the seven essential sectors and produce market reports for each. These studies would form the background for merger reviews and investigations of market behaviour within such sectors. It is not clear whether the market studies would be published.
Investigative and enforcement powers
As foreshadowed above, the consultation paper also contemplates a formal investigatory framework. Businesses may therefore find themselves subject to information requests, market inquiries and regulatory investigations, previously uncommon outside Bermuda’s regulated sectors.
The CRA would be provided with a range of remedial tools, including behavioural remedies designed to change business practices, conditions attached to merger approvals, the power to reject mergers and order divesting of assets, and director disqualification for up to 15 years for serious offences.
Criminal penalties for serious cartel conduct would be up to $1,000,000 and five years’ imprisonment. The criminal offence would be brought into force once the CRA and the Director of Public Prosecutions agree a Memorandum of Understanding, and prosecution capability is in place.
The procedural safeguards for CRA investigations and hearings remain to be seen. Matters such as standing, disclosure, standards of proof, and confidentiality protections may ultimately turn out to be as important as the substantive prohibitions themselves.
Court supervision
CRA decisions, directions and penalties would be appealable to Bermuda’s Supreme Court on questions of fact and law, with fresh evidence admitted only with leave.
Appeals against interim measures would be expedited and decided on the same standard of judicial review of governmental/ministerial decisions, with such appeals possibly including legal challenges to information requests made as part of the CRA’s market studies.
Rulings except financial penalties would continue to apply pending appeal unless the Court stays such rulings.
The Court could also sit with one or two economic assessors, providing specialist expertise without creating a separate tribunal. Is this modelled on the Competition Appeal Tribunal in the UK, where a judge or legal chair sits with lay members such economists or accountants?
Looking ahead
The public consultation closed on 15 September 2026. It will be interesting to see the extent to which the foregoing proposals and others summarised in the consultation paper make it into the bill presented to Parliament, and the specific wording of the proposed provisions.
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. Kennedys operates in Bermuda in association with Kennedys Chudleigh Ltd.
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