Currently in Bermuda partnerships (exempted, exempted limited and overseas) which have elected to have separate legal personality in accordance with section 4A of the Partnership Act 1902 are “relevant entities” and therefore in scope of the economic substance regime.  A bill relating to the Economic Substance Amendment Act 2021 (the “Bill”) was tabled in the House of Assembly of Bermuda on 5 June 2021, which will ensure that all partnerships (even those that do not elect to have separate legal personality) are included in the definition of “relevant entity”.  As such, these partnerships will have to make a determination of status and, unless exempted, comply with the applicable economic substance test.

Existing partnerships which will become “relevant entities” following these amendments shall have six months from the coming into operation of the amending act to comply with the economic substance requirements.

The Bill has been introduced in response to commitments made to the EU Code of Conduct Group, and similar amendments have also been proposed in the other British Overseas Territories as well as the Crown Dependencies of isle of Man, Guernsey and Jersey.  We will continue to watch this space and provide further updates in due course.

Share
Twitter LinkedIn Email Save as PDF
More Publications
24 Mar 2021 |

Economic Substance update Q1 2021

Economic Substance update Q1 2021

12 Mar 2021 |

Material adverse change clauses in light of the Covid-19 pandemic

Experts from each of our key global offices provide jurisdiction specific advice and answer question...

14 Dec 2020 |

Technology & Innovation Update Q4 2020

Technology & Innovation Update Q4 2020

Contributors: Peter Colegate
14 Dec 2020 |

Economic Substance update Q4 2020

Economic Substance update Q4 2020

18 Aug 2020 |

Technology & Innovation update Q3 2020

In each quarterly issue of the Appleby Asia Alert, we bring you the latest offshore legislative and ...

Contributors: Peter Colegate
18 Aug 2020 |

Economic Substance update Q3 2020

The latest Economic Substance updates announced by the relevant authorities in the BVI, Cayman and B...

18 Aug 2020 |

The facilitation of cross border restructurings in Bermuda, the British Virgin Islands and the Cayman Islands

In this update, we consider the powers and discretion of the domestic courts in Bermuda, the BVI and...

26 May 2020 |

Technology & Innovation Update Q2 2020

Technological developments have been accelerating at an unprecedented pace in Asia - the first regio...

Contributors: Peter Colegate
25 Feb 2020 |

Economic Substance update Q1 2020

On 18 February 2020, the Economic and Financial Affairs Council (ECOFIN) announced that Bermuda and ...