As an experienced Bermudian company specializing in company formation, we understand that you are looking for a reliable partner who will be able to help you through the process. Any company in Bermuda can be formed by corporate entities, individuals who want to start a business or trade within or from Bermuda. According to the Companies Act 1981, seven types of companies can be formed.
• Companies without limited liability
• Companies which survive for limited period
• Companies, the work of which is limited by shares
• Companies which are incorporated by Private Act
• Mutual funds
• Mutual insurance companies
• Companies which are limited by guarantee
All the companies will be either incorporated through registration or by Private Act. The registration process is normally completed within 2 business days. In most cases private companies are established after an exemption is made from the Company Act. In other instances, to form a private company, legislation needs to be sought. However, it will be good to know that as per the Company Law there is differentiation between an exempted company and a local company. By definition, a local company is one which carries domestic business in Bermuda. An exempted company however carries out international business from the country.
It is possible for a foreign individual or a non-resident of Bermuda to form an exempted company. Now you may ask why they are termed as exempted companies. The reason that they are called exempted companies is because they are normally exempted from the ownership restrictions which are applicable for local companies. Bermuda is quite popular among Fortune 500 companies which want to form a Bermuda exempted company for different forms of business activities like take-overs, collective investment schemes, holding assets, reinsurance, shipping etc.
Depending on the nature of the business, the exempted company will be formed within two business days. However, the time may differ, as the licensing requirements may be different for different businesses. Each member of the company who are holding 5% or more of the shares should get approval from Bermuda Monetary Authority. Upon application, all Bermuda companies are exempted from all kinds of taxation. This will be valid till the year 2035. However, the time period may change from time to time, through amendment of Exempted Undertakings Protection Act. A good thing to know is that Bermuda exempted companies are not subject to any subject control restrictions.
For the formation of a local company in Bermuda, one has to be an individual, company or trust; the definition however is regulated by Companies Act 1981. All local companies are controlled by Bermudians and the ‘control’ is absolutely defined by Companies Act 1981. The Bermudians hold 60% of the total shares of the company and they must form 60% of the total Board of Directors. If you are planning to form a company in Bermuda, it is absolutely mandatory that you take a look at Memorandum on the Incorporation of Local Companies before making a move.