The Council of the EU adopted a resolution on a Code of Conduct
for business taxation, the aim of which is counteracting the
effects of zero tax and preferential tax regimes around the
world. In 2017 the Code of Conduct Group (Code
Group) investigated the tax policies of both EU member
states and third countries, assessing (i) tax transparency; (ii)
fair taxation; and (iii) implementation of anti–BEPS
measures.
Following assessment by the Code Group, Bermuda was included in
a list of jurisdictions which are required to address the Code
Group's concerns about 'economic substance'. Like
their counterparts in BVI, Cayman, Guernsey, Jersey and Isle of
Man, the government of Bermuda has been working closely with the
Code Group to ensure those concerns are addressed. As a
result of this engagement, the Economic Substance Act 2018
(Substance Act) and the Economic Substance
Regulations 2018 (Substance Regulations) became
operative on 31 December 2018.
