Fact vs fiction

BDA and industry respond to ICIJ reports

HAMILTON, Bermuda, Nov.  10, 2017  (GLOBE NEWSWIRE) -- Reportage about hacked data from global law firm Appleby has highlighted the substantial lack of media understanding of offshore investment structures and Bermuda's long-time reputation for tax transparency and cooperation with international authorities.

Bermuda is committed to the exchange of relevant information to legitimate regulatory, tax and law enforcement entities. These can request and receive information from Bermuda under information-sharing agreements, including TIEAs and a multi-lateral treaty with more than 100 countries.

Automatic exchange of financial information is also an established part of our economic system. The island's early adoption of OECD standards for Base Erosion and Profit Sharing (BEPS) compliance clearly demonstrates this transparency via several agreements that ensure automatic transmission of taxpayer financial data to relevant authorities.

Notably, Bermuda is a signatory to the Multilateral Competent Authority Agreement for automatic exchange of financial account information via Common Reporting Standard (CRS) and Country-by-Country (CbC) reports. The island has also signed a Model 2 intergovernmental agreement with the US under the Foreign Account Tax Compliance Act (FATCA), again, enabling automatic exchange of information from Bermuda-based financial institutions.

As a direct result of meeting these stringent standards, Bermuda this fall was the first overseas territory to be awarded whitelist status by France for CbC reporting. Bermuda is also judged "largely compliant" by the OECD Global Forum rating following a peer-review process of tax-transparency standards-a rating shared by Canada, Germany and Norway, among other nations.

Additionally, the UK has an agreement with all its Overseas Territories under which Bermuda shares information within 24 hours. Our 70-year-old register-with a starting threshold at incorporation of 10 percent beneficial ownership (vs UK and others at 25 percent-is continuously updated when shares in a company are transferred, as opposed to citing dates of incorporation or annual returns, as is practice in the UK and other jurisdictions.

The issue of privacy versus secrecy has also been confused. Privacy provides protection over confidential information within a well-regulated, safe environment-yet ensures sharing with tax authorities under Bermuda's global treaties. Secrecy, by contrast, enables concealment of information that should be disclosed. Given Bermuda's strong record on compliance and global transparency, our system respects privacy, yet shuns secrecy.