On 14 December 2011, following a comprehensive review of the Bermuda Companies Act 1981 (the "Companies Act" ) undertaken by the Legislative Change Committee of Business Bermuda, of which Appleby (Bermuda) Limited is an active participant, and in collaboration with the Ministry of Business Development and Tourism, the Senate passed the Companies Amendment (No.2) Act 2011 (the "Amendment Act" ).
The Amendment Act updates and improves Bermuda's company law and provides, amongst other benefits, the opportunity for simplified management and operation of Bermuda companies, widened exemption from the requirement for transfer of listed securities by written instrument and an enhanced choice of corporate structures for mergers and acquisitions aimed at making Bermuda a more attractive and competitive jurisdiction.
The key changes brought about by the Amendment Act, which will be elaborated upon in more detail in a Brief to be circulated shortly, are as follows:
- Introduction of corporate directorships.
- Minimum number of directors reduced to one.
- Ability to opt out of holding annual general meetings.
- Share capital and share premium removed from solvency test calculations for declaration and payment of dividends and other distributions.
- Exemption from the requirement for the transfer of securities by proper instrument widened to include all securities listed or admitted for trading on an Appointed Stock Exchange.
- Introduction of concept of corporate merger whereby one company survives.
- Prohibition on financial assistance abolished.
- Improved provisions for right to acquire remaining shares of a company by holders of at least ninety five per cent of shares in that 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.
