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ARTICLE · 10 JANUARY 2022

Bermuda Economic Substance Update

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Following consultation with industry, the Economic Substance Regulations 2018 have been amended by the Economic Substance Amendment (No.2) Regulations 2021 ("Amendment Regulations") which amends the...

BermudaFinance and Banking
Sarah Demerling
Sarah Demerling
Natalie Neto
Natalie Neto
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Following consultation with industry, the Economic Substance Regulations 2018 have been amended by the Economic Substance Amendment (No.2) Regulations 2021 ("Amendment Regulations") which amends the definition of the relevant activity of "fund management" in Bermuda. Certain consequential revisions have also been made to the Economic Substance Guidance Notes ("Revised Guidance Notes"). The Amendment Regulations and Revised Guidance Notes became operative with effect from 1 January 2022.

Consequently, with immediate effect, an entity (which includes a company to which the Bermuda Companies Act 1981 applies, a Bermuda LLC and a Bermuda partnership, but excludes an entity that is resident for tax purposes in a jurisdiction outside of Bermuda that is not on Annex 1 to the EU list of non-cooperative jurisdictions for tax purposes) will be carrying on the relevant activity of "fund management" if it manages investments for an 'investment fund' (as such term is defined in

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