The Economic Substance Act and the Economic Substance
Regulations became operative on 31 December 2018 to address
concerns raised by the European Union (EU) with respect to offshore
structures aimed at attracting profits which do not reflect real
economic activity in the jurisdiction.
Bermuda was added to the EU's list of non-cooperative
jurisdictions for tax purposes on 12 March 2019. The Premier of
Bermuda released a statement confirming that whilst Bermuda's
legislative framework is compliant today with the EU requirements a
technical omission, now corrected, resulted in the breach of a
mandatory deadline thus leading to the present inclusion in the
non-cooperative list. The Premier reported that the UK government
has stated "that Bermuda has legislated to address the issue
identified. In light of this we expect Bermuda, and other compliant
jurisdictions, to be removed from the list at the next available
opportunity." The next meeting of the EU's Economic
