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Aviation

Bermuda

There are currently almost 300 aircraft registered in Bermuda in both the public and private categories. Aircraft registered in Bermuda may be operated anywhere in the world. Bermuda has recently seen a significant number of registrations on behalf of Russian clients.

Banking

Bermuda

Sometimes a person is asked by a family member or friend to act as guarantor on a mortgage or personal or business loan from a bank or other lender. However, in a worst-case scenario, acting as a guarantor can lead to financial hardship or even bankruptcy. Although the safest option may be not to sign a guarantee agreement at all, a potential guarantor can take steps to minimize the risk.

A first mortgage transfers the legal estate to the secured lender. The borrower has the right to occupy the home and to have it transferred back when the mortgage loan is repaid with interest. Second and subsequent mortgages transfer a home subject to the first mortgage. The first lender will already hold the legal estate in a borrower's home. Thus, second and subsequent secured lenders are entitled only to the equity of redemption.

Capital Markets

Bermuda

The Bermuda Stock Exchange is celebrating its 40th anniversary this year. Due to the time-zone positioning of Bermuda, the exchange provides a trading venue in a Western time zone for securities of Asian, Latin American, North American and European issuers, as well as facilitating efficient fund raising in the United States by non-US issuers.

The Investment Funds Act makes new provision for the regulation of investment funds (formerly known as collective investment schemes) in Bermuda. Among other things, the act creates a new category of authorized fund and provides for a new licensing regime for fund administrators which ensures that licensed fund administrators have proper personnel and operating systems in place.

Commercial Property

Bermuda

Lease provisions bind tenants until the end of the lease period. If a tenant wishes to leave a premises before the lease term expires, there are three options: surrendering, transferring or sub-letting. Landlord and tenant are usually free to negotiate terms and conditions to allow for circumstances not accounted for by the lease. Such terms and conditions are decided by the negotiating abilities (or otherwise) of each party.

Company & Commercial

Bermuda

Among other things, the Companies Amendment (No 2) Act 2011 provides for greater flexibility in corporate administration, simplifies the requirements for the electronic transfer of securities and introduces the previously unavailable concept of mergers as an alternative to other business acquisition models. It is hoped that these changes will enhance Bermuda's edge over rival offshore jurisdictions.

The Senate recently passed the Companies Amendment (Number 2) Act. The act updates and improves Bermuda's company law and provides, among other benefits, the opportunity for simplified management and operation of companies and an enhanced choice of corporate structures for mergers and acquisitions – all of which are aimed at making Bermuda a more attractive and competitive jurisdiction.

The Companies Act sets out specific requirements to which every Bermuda company must adhere, including requirements to have a local registered office address and to keep various statutory books at the registered office. While every Bermuda company must ensure that all requirements of the act are properly complied with, it may prove difficult without the assistance of an experienced corporate services provider.

A general meeting is under the control of the chairman, who must concentrate on the punctilious conduct of the meeting. The company bylaws usually provide for the appointment of a chairman. Generally, the chairman of the board of directors will act as chairman of the general meeting. If that person is absent, another director nominated by the board will normally assume the position.

The House of Assembly recently passed six bills which aim to improve the operations of businesses in Bermuda. It is anticipated that the bills will receive Senate approval within the next few months. The passage of these bills will greatly improve Bermuda's already high standing and increase its competitiveness with other offshore jurisdictions, thereby establishing Bermuda as a premier location in which to do business.

Until recently, a private trust company could be established only as an ordinary Bermuda local or exempted company. The Companies Amendment Act 2006 introduced a second option: a private trust company can now be formed as a company limited by guarantee. A Bermuda private trust company has several advantages that make this type of company increasingly popular.

More updates >

Corporate Immigration

Bermuda

Applying to the Immigration Department of the Ministry of Labour, Home Affairs and Housing for a work permit need not be complicated and burdensome. If the guidelines in the Work Permit Policy 2001 are adhered to the process can be smooth and timely. An incomplete application will be rejected by the department and returned to the sender.

Corporate Tax

Bermuda

Bermuda has taken a proactive approach to negotiating and developing tax information exchange agreements. It is vital that this continues in order to demonstrate that Bermuda is legally sound and well regulated, and to influence the direction of global political policy that could affect its international reputation.

Employment & Labour

Bermuda

It is unlawful for an employer to discriminate against a disabled employee on the basis of disability unless 'unreasonable hardship' on the part of the employer can be proved. The Human Rights (Unreasonable Hardship) Amendment Act 2011 has now amended the need for the relevant minister to issue specific rules to govern how 'unreasonable hardship' could be determined.

Employers must identify the areas of business that they intend to protect when drafting a non-competition clause. Under recent case law, the key would appear to be confidential and sensitive information. The fact that an ex-employee may be able to work elsewhere, having been exposed to highly significant, confidential and sensitive information, will prompt a court to protect the employer.

The Employment Act 2000 was a landmark piece of legislation which established minimum employment standards in Bermuda for the first time. Any employee who is employed wholly or mainly in Bermuda comes within the jurisdiction of the act, as do employers. The act provides minimum requirements; however, if individual contracts or collective bargaining agreements are more favourable, their standards will prevail.

Minimizing the legal risks associated with the dismissal of an employee is good business practice for any employer in Bermuda. This is particularly true since the entry into force of the Employment Act 2000, which provides aggrieved employees with statutory remedies for unjust dismissal. However, employers can minimize the legal risks associated with the dismissal of an employee by taking certain steps.

The Employment Amendment Act 2006 has introduced a new regime for employers and employees in the areas of termination and the winding-up of companies, but made no change to the provisions on overtime. Among other things, an employee's employment may be terminated only for a valid reason connected with the ability, performance or conduct of the employee or the operational requirements of the employer's business.

Mauritius

A year after its proclamation, legislation governing employment relationships in Mauritius has marked the beginning of a new era in employment law. The Employment Rights Act 2008 has consolidated the old law and the principles underpinning the employment contract. Furthermore, it has endorsed concepts that are now regarded as fundamental to most employment law regimes.

Information Technology

Bermuda

The highly debated Public Access to Information Act represents a monumental change in how information held by the Bermuda public authorities can be accessed and obtained. It is hoped that officials will consider carefully in each case whether the public would be better served by disclosure than the non-disclosure of the information requested.

Insolvency & Restructuring

Mauritius

The new Insolvency Act is intended to consolidate and modernise the legal framework for insolvency by updating and integrating it into a modern and comprehensive regime covering both individual and corporate insolvency. The act states that a company is unable to pay its debts if it fails to comply with a statutory demand within a period of one month after the last date for compliance with the demand.

The Supreme Court of Mauritius recently delivered an interlocutory judgment on the appointment of an administrator under the Insolvency Act 2009. The judgment is the first on this issue and provides a precedent as to the approach that the Supreme Court is likely to adopt in the future in similar matters.

Insurance & Reinsurance

Bermuda

A draft report of the European Insurance and Occupational Pensions Authority has raised hopes that Bermuda's regime for commercial insurers will meet regulatory equivalence with the new Solvency II rules for the large commercial (re)insurance sector, but without having to impose the same complex rules on the captive insurance sector.

The Bermuda Monetary Authority has published its latest regulatory update which contains figures for the first quarter of 2011. Developments include the launching of a series of industry awareness sessions and technical workshops to ensure that the insurance market remains aware of new requirements resulting from the authority's regulatory enhancements.

New legislative amendments have increased many of the fees payable to the Bermuda Monetary Authority under the Insurance Act. The date and manner in which fees are to be paid under the Insurance Act have also been amended and new provisions have been included to introduce late penalty fees and to allow the authority to recover any fee or penalty as a civil debt.

A new law which came into force in December 2010 enhances the Bermuda Monetary Authority's current insurance regime and introduces changes to the classification of insurers carrying on long-term business, notification requirements in the event of a change in control, and group supervision, among other things.

The new Insurance Code of Conduct is part of continued reforms being implemented by the Bermuda Monetary Authority to further its objective of establishing a risk-based regulatory regime that meets or exceeds international standards. The code summarises existing best practices adopted by Bermuda insurers and is more a document of consolidation than one which creates new obligations.

Historically, Bermuda has been at the forefront of the growth and success of the global, conventional insurance and reinsurance market. More recently, however, interest has been sparked in the relatively new and growing market of Shari'ah-compliant takaful and retakaful, the insurance and reinsurance of the Islamic world.

More updates >

Litigation

Bermuda

Judicial review proceedings in Bermuda normally address decisions by regulatory bodies, tribunals and the immigration authorities. Judicial review is not concerned with the merits of a decision: the only question before the court is whether the public body has acted lawfully. A judicial review can be commenced based on matters that are illegal, irrational or procedurally improper.

When entering into a contract with a foreign party, Bermuda residents can maximize the likelihood that a future dispute will be heard in Bermuda by providing for it in the agreement. However, in many instances agreements do not address the issue of jurisdiction. In these situations the court will consider a number of factors in determining whether the proceedings should be heard in Bermuda or in another court.

Offshore Services

Bermuda

The Companies Amendment (No 2) Act 2011 has come into effect. Among other things, the act provides for greater flexibility in corporate administration, simplifies the requirements for the electronic tranfer of securities and introduces the previously unavailable concept of mergers as an alternative to other business acquisition models.

The Senate recently passed the Companies Amendment (Number 2) Act. The act updates and improves Bermuda's company law and provides, among other benefits, the opportunity for simplified management and operation of companies and an enhanced choice of corporate structures for mergers and acquisitions – all of which are aimed at making Bermuda a more attractive and competitive jurisdiction.

It is unlawful for an employer to discriminate against a disabled employee on the basis of disability unless 'unreasonable hardship' on the part of the employer can be proven. The Human Rights (Unreasonable Hardship) Amendment Act 2011 has now amended the need for the relevant minister to issue specific rules to govern how 'unreasonable hardship' is determined.

A recent review by the European Insurance and Occupational Pensions Authority has raised hopes that Bermuda's regime for commercial insurers will meet regulatory equivalence with the new Solvency II rules for the large commercial (re)insurance sector, but without having to impose the same complex rules on the captive insurance sector.

The Bermuda Monetary Authority has published its latest regulatory update which contains figures for the first quarter of 2011. Developments include the launching of a series of industry awareness sessions and technical workshops to ensure that the insurance market remains aware of new requirements resulting from the authority's regulatory enhancements.

Often a trust gives powers to someone other than the trustee, usually because the settlor wishes to introduce a third party into the trust in order to police the actions of the trustee. The office of protector involves conferring a supervisory power on the appointee through the inclusion of various powers in the trust deed. A protector is routinely given the responsibility to approve (and thus the right to veto) certain actions of the trustee.

More updates >

Mauritius

The new Insolvency Act is intended to consolidate and modernise the legal framework for insolvency by updating and integrating it in into a modern and comprehensive regime covering both individual and corporate insolvency. The act states that a company is unable to pay its debts if it fails to comply with a statutory demand within a period of one month after the last date for compliance with the demand.

The Supreme Court of Mauritius recently delivered an interlocutory judgment on the appointment of an administrator under the Insolvency Act 2009. The judgment is the first on this issue and provides a precedent as to the approach that the Supreme Court is likely to adopt in the future in similar matters.

Over the past decade, investors keen to invest in projects not only in India and Asia, but also in Africa, have increasingly done so through Mauritius. Mauritius combines the traditional advantages of an offshore financial centre in the Indian Ocean with the distinct advantages of being a treaty-based jurisdiction, with a substantial network of treaties and double taxation avoidance agreements.

A year after its proclamation, legislation governing employment relationships in Mauritius has marked the beginning of a new era in employment law. The Employment Rights Act 2008 has consolidated the old law and the principles underpinning the employment contract. Furthermore, it has endorsed concepts that are now regarded as fundamental to most employment law regimes.

Institutions, like individuals, are making more calculated decisions to maximize productivity and reduce risk and unqualified expenses. A more cautious period for hedge funds is thus envisaged, with international clients rethinking large-scale refinancing and extending timeframes for existing projects.

Legislation on industrial property in Mauritius is undergoing review. The government's ambition is to enhance a legal environment that keeps abreast with international, constantly evolving trends, thus making Mauritius a platform with a sound legal framework to protect the IP rights of internationally well-known brands.

More updates >

White Collar Crime

Bermuda

Bermuda has longstanding obligations to maintain procedures on anti-money laundering and anti-terrorist financing. The Proceeds of Crime Regulations (Supervision and Enforcement) Act 2008 established a new regulatory regime, designating the Monetary Authority as the supervisory body for securing compliance with the regulations by relevant institutions and detailing the obligations and powers related to this duty.