On 16 May 2022, Bermuda's Registrar of Companies (Registrar) announced that reviews of Bermuda entities' economic substance compliance would commence immediately.
In order for the Registrar to demonstrate the effectiveness of its supervisory framework, it will undertake both desktop and on-site audits of Bermuda entities.
This announcement follows the Registrar's recent non-compliance actions in March and April 2022 with respect to economic substance for the 2019 and 2020 financial periods. Proposed penalties for non-compliance for these periods ranged from $7,500 to $100,000 (per offending entity).
If a Bermuda entity receives a compliance review notification from the Registrar, Appleby's experienced and dedicated regulatory team is ready to assist with any preparation requirements.
If a Bermuda entity is part of a compliance investigation, Appleby's regulatory team has the expertise to provide guidance through any potential enforcement action by the Registrar.
Bermuda entities are reminded the filing deadline for those entities with a 31 December 2021 year-end is 30 June 2022.
There have been further changes and updates to the economic substance declaration form with Appleby advising clients on issues such as:
- Changes to beneficial ownership reporting for regulated entities, subsidiaries of listed companies and overseas permit companies
- Changes to Director information to be included in the submission
- The process for entities which earned no gross revenue in respect of their relevant activity
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.