Bermuda Removed from EU “Grey List”

Bermuda Removed from EU “Grey List”

About Brian HoldippBrian Holdipp

Brian Holdipp is Counsel in the firm’s corporate practice group. His practice encompasses many areas of general corporate and commercial law, with specialist expertise in securities, joint ventures, corporate restructurings and cross-border financings. Mr. Holdipp also advises on partnerships.

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Bermuda was removed from Annex II of the European Union (“EU”) list of non-cooperative tax jurisdictions (also referred to as the EU “grey list”) at the 4 October 2022 meeting of the the Council of the European Union.  In announcing the removal, the European Council confirmed that Bermuda’s commitment “with regard to the Organisation for Economic Co-operation and Development’s Forum on Harmful Tax Practices’ recommendations on the effective implementation of substance requirements was deemed fulfilled”

Commenting on this positive news, Premier and Minister of Finance of Bermuda, the Hon. E. David Burt JP MP, said that Bermuda prides itself on being a transparent jurisdiction and always compliant with EU standards”, going on to affirm that Bermuda remains “committed to cooperating with the OECD FHTP and EU Code of Conduct Group (Business Taxation) in implementing tax governance standards.” 

The country’s restoration to the EU “white list” evidences the satisfaction of the OECD FHTP with  Bermuda’s monitoring of resident companies’ compliance with economic substance legislation.  The Economic Substance Act 2018 and the Economic Substance Regulations 2018 require resident companies that are in scope of the legislation to maintain a substantial economic presence in Bermuda. 

We, at MJM, can help you with any queries you may have with regard to the ambit of, and compliance with, Bermuda’s economic substance regime.  Any member of our Corporate Team would be pleased to assist.