Bermuda Investment Funds - Summer 2026 Update

Consultation paper on sustainability-related investment disclosures

In September 2025, the Bermuda Monetary Authority ("BMA") issued a consultation paper introducing sustainability disclosures and prohibition on the use of misleading fund names. The proposals are intended to introduce sustainability disclosures to the investment funds regulatory framework and protecting investors from misleading fund names.

Sustainability-related terms and definitions

Respondents noted that the proposed definition of “sustainable investing” could be too broad and may inadvertently capture funds that consider environmental, social and governance factors as part of their investment process without pursuing a specific sustainability objective.

In response, the BMA indicated that it would clarify the proposed disclosure requirements by refining the definition and adopting principles-based and outcomes-focused requirements. This will ensure that investors have access to sustainability-related information that is fair, clear and proportional to the level of materiality of the fund's sustainability objectives and investment strategy.

Enhanced disclosures: fund offering document 

Respondents highlighted the importance of a flexible approach to disclosure requirements, specifically emphasising two concerns: (i) narrowing the risk disclosure requirements and focusing on material risks to the fund's sustainability objective or investment strategy; and (ii) clarity regarding the disclosure expectations applicable to feeder funds, particularly where the master fund is domiciled overseas and subject to another sustainability reporting regime(s).

The BMA confirmed that Bermuda feeder funds will remain in scope of the proposed disclosure requirements, but comparable overseas disclosure regimes (such as the European Union's Sustainable Finance Disclosure Regulations) may be relied upon to demonstrate compliance with the Bermuda framework. In this instance, it is important for the Bermuda feeder fund to ensure that the sustainability information disclosed in its offering document is fair, clear and accurate.

Next steps 

The BMA set out the updates currently under review in the Appendix to the Consultation Paper. Once the proposed amendments are incorporated into legislation, it is anticipated that registrants will have six months to comply with the disclosure requirements.

Introduction of a new pre-approval process

The BMA has introduced a streamlined Approval in Principle ("AIP") process to support the efficient establishment of new investment funds in Bermuda.

Normally, complete applications for new funds are reviewed within eight-business days, but with this AIP pathway, applicants that submit the required documentation may receive conditional pre-approval within two to three business days.

Although the AIP process gives applicants greater regulatory certainty, a fund must not commence business, accept subscriptions or represent itself as registered or authorised until formal approval is granted.