Register company in Bermuda

Register company in Bermuda

With our lean-and-mean mentality, you can rely on our team of experts to provide you with a seamless experience throughout the whole process of Bermuda company formation. Our ultimate goal is for your Bermuda company to be operationally ready within the stipulated time frame.

Our service package includes everything you will require for establishing a business in Bermuda:

• Bermuda company registration with Bermuda Monetary Authority.

• Local company secretary and registered address

• Corporate bank account opening services

• Annual accounting and tax services

How long does it take to register company in Bermuda and open a corporate bank account?

• Tetra Consultants will complete the steps to register company in Bermuda through a seamless and fuss-free procedure. Upon receiving the required due diligence documents of the directors and shareholders, Tetra Consultants will proceed ahead with the search for the availability of your preferred business name.

• Within 2 weeks of engagement, you can expect to receive the documents of your new company including a certificate of formation, memorandum, and articles of association as well as a register of directors and shareholders.

• Within 4 weeks upon Bermuda company registration, Tetra Consultants will assist in opening a corporate bank account with Bermuda’s local banks or International banks depending on your business goals and objectives.

• Consequently, you can expect to start operations and issue invoices with your Bermuda Company within 6 weeks upon engaging Tetra Consultants.

Can a foreigner start a business in Bermuda?

• Yes, a foreigner can start a business in Bermuda provided that Bermuda company regulations do not allow 100% ownership of the business unless the entity is registered as a Bermuda-exempted company.

• An exempted company is a company, which is “exempted” from the requirements imposed on local companies by the Bermuda Companies Act 1981 (the Companies Act), in particular, the requirement that at least 60% of the equity of a company must be owned and controlled by Bermudians is not imposed on an exempted company. This allows for an exempted company to be 100% foreign (i.e. non-Bermudian) owned and controlled.

• The Bermuda Monetary Authority (BMA) must approve the incorporation of all Bermuda exempted companies. Accordingly, an application for permission to incorporate the exempted company must be submitted to the BMA, together with the disclosure of ownership and personal declaration by the non-Bermudian beneficial owner.

• The benefits of such type of entity can be enumerated as:

• A Bermudan-exempted company requires minimal infrastructure: The Companies Act 1981 requires a minimum of one director and one shareholder to incorporate an exempted (limited) company in Bermuda; these individuals can be of any nationality and need not be resident in Bermuda. Additionally, corporate shareholders are also permitted.

• Exempt companies in Bermuda require minimal administration: Exempt Companies are generally not required to file accounts or annual returns, if the company does choose to keep records they can be kept anywhere in the world. An exempted company is not generally required to file accounts with the Registrar. The only annual filing with the Government is the Statutory Declaration of the authorized share capital which is used to calculate the annual government fee.

• Exempt companies in Bermuda are exempt from a large number of taxes: An Exempt Company has no taxes on profits, income, or dividends, nor is there any capital gains tax, or estate duty within Bermuda.

• An exempted company in Bermuda requires minimal capital to maintain: Companies limited by shares are no longer required to maintain a minimum share capital.

• It is quick to incorporate an exempted company in Bermuda. It only takes 2 weeks to create an exempted company in Bermuda.

Types of business entities to consider when you register company in Bermuda

Bermuda companies fall into two principal categories: companies incorporated by Bermudians to trade primarily in Bermuda and companies incorporated by non-Bermudians for the purpose of conducting business outside Bermuda.

These two categories can be recognized as

• Local Company

• Exempted Company

Local Company

• A company, trust, or individual who is a Bermudian within the meaning of the Bermuda Companies Act 1981 may incorporate a local Bermuda company to conduct business within Bermuda.

• Local companies must be controlled by Bermudians and ‘control’ is defined in the Companies Act 1981 as Bermudians holding sixty percent of the shares, and Bermudians forming sixty percent of the board of directors.

Exempted company

• Companies falling into this category are known as “exempted companies” and are so-called because they are exempted from the provisions of Bermuda law which stipulates having at least 60% of the equity to be beneficially owned by Bermudians. Permit companies (ie overseas companies which have received a permit to carry on business in or from within Bermuda) are addressed generally as exempted companies.

• In general terms, the Bermuda company law restricts an exempted company from carrying on business in Bermuda, except to the extent that it is so authorized by the constitutional documents and has been granted a license by the Minister of Finance (the “Minister”) who will form a view as to whether or not the granting of such a license is in the best interest of Bermuda. Having said that, there are certain activities that are expressly excluded from the requirement for a license.

• The minimum requirements to register company in Bermuda in the form of an exempted company are as: at least one shareholder who can be a natural person or corporation with no restrictions on nationality, one director who can also be a natural person or corporation with no restrictions on nationality (the shareholder can be appointed as a director at the same time), one resident representative or registered agent, and one registered office must be located in Bermuda and no minimum share capital.

Secondary business vehicles to register company in Bermuda can be enumerated as:

Companies Limited by Shares

• Companies limited by shares predominate in Bermuda as the business vehicle of choice. They are governed by the Bermuda Companies Act, 1981 (Companies Act).

• The key advantage of such a type of company is that a shareholder’s liability is limited to the amount unpaid on their shares. The company vehicle is therefore a method to engage in transactions that would otherwise expose a shareholder to liability. A company limited by shares is also an efficient vehicle for pooling capital, especially in cases where investors seek to negotiate different commercial rights among themselves.

• A Bermuda company limited by shares is permitted a great deal of flexibility in determining how the rights of different members or shareholders are regulated because a company’s constitutional documents can be tailored to build in different economic and/or voting rights among shareholders.

Partnership

• The partnership is a popular vehicle for international ventures primarily because it is regarded in most jurisdictions (including the US and the UK) as fiscally transparent. As a general principle, tax is imposed at the partner level, not at the partnership level, and consequently, the tax position of one partner does not affect the position of any other partner.

Limited Liability Companies (LLCs)

• A limited liability company is a separate legal entity that, subject to the LLC agreement, has the capacity, rights, powers, and privileges of a natural person. Limited liability companies differ from companies limited by shares in that they are governed by the Bermuda Limited Liability Company Act of 2016 which provides that maximum effect is to be given to the principle of freedom of contract and to the enforceability of LLC agreements with respect to the formation and operation of an LLC.

Company Limited by Guarantee

• Under a company limited by guarantee, the liability of the company’s members will be limited by the memorandum to an amount as the members may undertake to contribute to the company’s assets in the event of it being wound up. These companies are used for charitable or “social” purposes and do not pay dividends.

Limited Duration Company

• This type of company will have a fixed duration and will automatically dissolve on the expiration of a period, or upon the occurrence of a specific event, as stated in the memorandum of association. The event may be a “simple” event (such as a fixed date) or a “complex” event (such as the death of a shareholder but subject to an extension or confirmation procedure).

Advantages of registering a company in Bermuda

• 100% foreign ownership

• 100% exemption from capital gains and real estate taxes

• 100% exemption from income taxes and taxes on dividends

• Information regarding directors, shareholders, and owners are not part of public records

• Companies registered in Bermuda do not have to maintain annual records

How to register company in Bermuda?

Tetra Consultants’ team of experts suggests you read through this guide to fully understand the incorporation process and steps involved at every stage of a Bermuda company formation. Our team of dedicated consultants has years of experience guiding clients on how to register company in Bermuda with a smooth and straightforward procedure.

Accounting and tax obligations in Bermuda

• In Bermuda, there are no taxes on profits, income, or dividends nor is there any capital gains tax, withholding tax, estate tax, or death duty. Profits can be accumulated and it is not obligatory to pay dividends. As of April 1, 1990, stamp duty was eradicated on transactions involving exempted companies and non-residents.

• An exempted company is entitled to apply for an undertaking from the government that, in the event of direct taxation being imposed in Bermuda (e.g. corporate tax, dividend tax), the company will be exempt from such taxes until the year 2016. This period is extended from time to time.

• All the companies in Bermuda must maintain books and records at their registered office in Bermuda and must lay annual accounts before shareholders (unless shareholders waive this requirement). There is no requirement under Bermuda law to publicly file accounts.

What are the documents required to register company in Bermuda?

The documents required to register company in Bermuda are dependent on the type of business structure intending to be incorporated. However, the general documentation required does not differ substantially which may include, not limited to:

• Name of the company

• Notarized passport copies and details of all the prospective managing directors, supervisory directors, and any existing proxy holders

• The company’s registered address details

• Article and memorandum of association

• A description of the company (purpose)/ business plan

Why do companies register in Bermuda?

Political

• Bermuda’s present political atmosphere is supportive, and the current administration is business-friendly. They were elected democratically in 2012 and have consistently demonstrated their dedication to improving Bermuda’s international reputation and encouraging international investment.

• The Bermuda Government is business-friendly and the more streamlined and informative policies related to work permits in March 2015 have assisted with encouraging business opportunities in Bermuda for foreigners.

• Bermuda has a sophisticated political system focusing on market depth, and a well-balanced and rational regulatory environment. Furthermore, the Bermudan government’s long-standing dedication to global cooperation and openness has guaranteed that it is a well-respected jurisdiction aimed at attracting and retaining blue chip investors and businesses.

Economy

• According to the World Bank data for 2021 Bermuda had 7.08 billion US dollars of gross domestic product (GDP), boasting one of the highest Real Gross Domestic Product (Real GDP) per capita in the world, Bermudian officials attribute much of this success to a robust financial services sector that has allowed the country to build an outstanding global reputation.

• Bermuda, formerly regarded as the world’s risk capital, is now hailed as the “Silicon Valley of the Atlantic” because of the country’s robust and appealing legal framework, which has opened the way for a thriving environment in which Fintech and blockchain companies can flourish.

• Bermuda is an undeniable global risk capital hub, and it remains at the forefront of insurance-linked securities (ILS), which have proven to be a highly tempting market for insurers and investors in recent years. The European Commission granted Bermuda Solvency II equivalence, increasing Bermuda’s attractiveness as a world-class international financial center. This accomplishment puts Bermuda’s (re)insurance business on par with other competitors in the EU.

Legal

• Bermuda is very well-regulated, giving people the confidence to put billions of dollars of capital into the market. Bermuda’s commercial regulations are globally equivalent and less bureaucratic than others and are more risk-based, consequently, bringing that aspect of dynamism into the market.

• Bermuda has implemented legislative and regulatory developments over the past few years which have invigorated Bermuda’s high-net-worth client and asset management industries.

• For example, In May 2015 several amendments were made to the Bermuda partnership legislation which was further amended in 2016 by conferring on Bermuda partnerships many of the same rights afforded to Bermuda companies. These changes continue to enhance the various funds’ vehicles available in Bermuda and are an indication of Bermuda’s commitment to continuing to be responsive to the needs of its private equity and fund sectors, and remaining as a preferred jurisdiction for new and established businesses.

Social

• The island boasts a high level of life, which connects back to the strong presence of international business in Bermuda. Despite the fact that Bermudians work hard for a job, everyone takes time to relax and enjoy the magnificent natural surroundings.

• The civilian population of the island is estimated to be 64,867 people, and Bermudans are noted for being exceptionally friendly.

• Though, Bermuda is certainly not a destination chosen for the cost of living by ex-pats as the country is ranked first place by the world data info and the rankings of Numbeo 2022 for having the highest cost of living.

Technology

• Bermuda has been known as the wired island for over a decade and that is not solely based on the abundance of wi-fi hot spots in the country. Indeed, the island provides a full complement of IT services and support, redundancy capability, cloud and digital certificate services, and disaster recovery services.

• Bermuda has fostered a booming e-business environment. The country boasts local success stories in e-business, both in security and payment processing, and these local companies have gone on to become recognized leaders in providing services to global customer bases, including some European governments.

• On a similar note, 100% of medium and large companies have a disaster recovery and business continuity plan which is an indication that even Bermuda’s SMEs are embracing technology.

Environmental

• Bermuda, located in the mid-Atlantic, is a British Overseas Territory with close ties to the Americas and Western Europe. With temperate winters and beautiful summers, it is easily accessible for visitors who can fly directly from the United States, Canada, and the United Kingdom.

• Bermuda’s coral reefs have long been considered a key component of the island’s natural wealth, as well as a prime marine asset for attracting visitors, contributing to 86% of the key on-island activities.

Looking to register company in Bermuda?

Contact us to find out more about how to register company in Bermuda. Our team of experts will revert within the next 24 hours.

FAQ

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