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Minister Of Finance Looks For Growth: Bermuda To Fast Track Incorporation Process For Collective Investment Schemes
Hamilton, Bermuda: 24 November 2005 - The Minister of Finance announced today that in an effort to further streamline processes she has determined that the business of collective investment schemes (more commonly known as mutual funds) is to be designated as an unrestricted business activity under the Companies Act with effect from Friday, 25th November, 2005. The effect is to simplify the incorporation process as these businesses will no longer require the Minister's approval.
The Minister stated that it is a priority of the Ministry to continually reinforce and enhance our strategies for developing Bermuda as a world class financial services center. For the mutual fund sector, our approach for branding Bermuda as an attractive jurisdiction for mutual fund business has become under more scrutiny in the wake of recent challenges to this sector. A recent survey commissioned by the Ministry of Finance revealed that the strength of Bermuda's appeal as an offshore financial center is predicated on three fundamental advantages:
Ø Its flexible and reasonable regulatory climate;
Ø The island's legacy as a trusted, sophisticated and stable locale; and
Ø The perceived depth and breadth of its infrastructure versus competitors.
The Minister stated that as more countries seek to replicate Bermuda's successful model as a credible financial services centre, Bermuda faces new challenges to offer not only credible but also competitive and responsive services to retain existing clients. The winners in the market will be those who focus over the next few years on this key issue.
The Minister emphasised that the change to the Companies Act was intended to make the process more efficient without in any way diluting Bermuda's rigorous vetting and approval standards for mutual funds. The benefit of the amendment would be to allow applicants to incorporate a scheme in Bermuda on an expedited basis, ahead of any application for classification. The Bermuda Monetary Authority would continue to carry out vetting of the beneficial owners of the applications at the time of incorporation and carry out its normal due diligence review of mutual funds as the regulator of collective investment schemes.