Industry groups on Bermuda including the Bermuda Insurance Management Association (BIMA) have pledged their support to efforts by the Bermuda government to get the country removed from the European Union’s so-called blacklist list of "non-cooperative" jurisdictions as quickly as possible.
The EU this week included Bermuda on a blacklist of 15 countries it said fail to meet good tax governance standards.
Bermuda was moved from the so-called grey-list to the blacklist for having failed to follow up on commitments previously made but not taken.
The Bermuda Premier David Burt responded by admitting being blacklisted was a “setback” but he added that he is also confident Bermuda will soon be removed from the blacklist.
Kathleen Bibbings, President, Bermuda Insurance Management Association (BIMA), said: "Bermuda's captive insurance sector, like other industry partners throughout our market, has a long, proven track record of cooperation and transparency, and as a jurisdiction, we'll work with the EU to meet requirements. We remain confident that Bermuda's full compliance will be confirmed shortly."
John Huff, President & CEO of the ABIR said that while there would be no immediate or tangible impact on re/insurers on Bermuda it was important the status was changed as soon as possible and the EU recognises the importance of Bermuda’s re/insurers to the EU.
"We have every hope today's EU determination will prove temporary. While ABIR understands there is no immediate tangible impact to Bermuda or its markets, we are appreciative of the Bermuda government's commitment to remedy the designation as soon as possible. There is bipartisan and industry consensus in Bermuda to meet international standards,” Huff said.
"The Bermuda re/insurance market is a valuable partner in the EU and has paid over $72 billion to EU policyholders and cedants over the past 20 years. ABIR is confident policymakers will act in the best interests of consumers to ensure continued level-playing-field access to our market's claims-paying capital and risk-management expertise."
In a show of unity on the island, a number of other groups and representative bodies also came out in support of the country’s regulatory regime and said they would work to change the EU status.
"Bermuda is a world-respected platform for business that has always adhered to the gold standard," said Roland Andy Burrows, CEO of the Bermuda Business Development Agency (BDA). "We stand firmly behind that reputation, and we commend our government's consultative approach with the EU to date. Our industry stakeholders are committed to working with the government and regulators to ensure Bermuda is recognised as fully compliant. We look forward to a positive result as soon as possible."
Sylvia Oliveira, Director, Bermuda International Long Term Insurers & Reinsurers (BILTIR), added: "The government of Bermuda assures us it is working at the highest levels to rectify the unfortunate placement of Bermuda on the EU's list of non-cooperative jurisdictions. As a staunch member of Bermuda's global business market, BILTIR stands firmly behind the island's top-tier reputation. Our collective view is that Bermuda is a leader in tax transparency and compliance and continues to be a great place to do business."
Patrick Tannock, chair, Association of Bermuda International Companies (ABIC), added:
"ABIC has been supportive throughout this process and is committed to continuing to work collaboratively with other industry groups to support the Bermuda government in its efforts to meet EU requirements."
Craig Bridgewater, chair, Alternative Investment Management Association (AIMA) network in Bermuda, said: "As the advocate for Bermuda's asset management sector, the AIMA network in Bermuda fully affirms this jurisdiction's efforts to consistently meet the highest global standards on tax cooperation and transparency. We support the Bermuda government's determination to have that long-standing reputation recognised and to achieve a positive EU designation for Bermuda."
Keith Robinson, Chair, Society of Trust and Estate Practitioners (STEP) Bermuda, added: "The Bermuda trust industry is well-regulated and Bermuda rightly regarded as a leading trust domicile. Our industry will continue to support the efforts of the government of Bermuda to see Bermuda removed from the list of 'non-cooperative' jurisdictions at the first opportunity."
In the past year, the EU Commission assessed 92 countries on their tax transparency, good governance, real economic activity, and whether the country had a zero corporate tax rate.
The EU welcomed action taken by 60 countries to address and resolve the concerns raised adding that “over 100 harmful regimes were eliminated”, while the list was cited as having a positive influence on internationally agreed tax governance standards.
However, EU finance ministers said they were forced to blacklist 15 countries based on the Commission’s findings. These included American Samoa, Guam, Samoa, Trinidad and Tobago, and US Virgin Islands, which made no commitments to change since the first blacklist was published in 2017. Barbados, United Arab Emirates and Marshall Islands have also been added to the list for failing to follow up on pledges to change.
Aruba, Belize, Bermuda, Fiji, Oman, Vanuatu and Dominica were moved from the ‘grey list’ to the blacklist for not abiding by commitments they had made.
Changes to EU legislation mean EU funds cannot be channelled or transited through entities in countries on the blacklist.
Bermuda, BIMA, EU, blacklist, Tax governance, David Burt, Kathleen Bibbings, John Huff, ABIR