Bermuda Insurance Chief Hits Back At Hypocrisy Claims

by Mike Godfrey, Tax-News.com, Washington

23 September 2002

ACE Insurance CEO, Brian Duperrault has become the focus of accusations of hypocrisy, following recent remarks about US companies which choose to reincorporate in Bermuda.

Speaking to the Hamilton Rotarians on September 10, Mr Duperrault condemned the furore created in the United States over corporate inversions to low tax jurisdictions such as Bermuda, suggesting that the country had 'lowered the bar' by accepting certain types of relocation.

'Having fought so hard to earn the imprimatur of 'blue chip jurisdiction', it doesn't make sense to risk that hard-won reputation by allowing companies to invert here from the US without asking that they bring something more than the cost of incorporation to Bermuda,' he observed at the time.

However, the insurance chief has come in for some flak, according to the Royal Gazette, following the revelation that ACE itself, although a long time corporate resident of Bermuda, is actually incorporated in the Cayman Islands.

Speaking to the Gazette on Wednesday, company spokesperson, Wendy Davis Johnson defended the ACE chief executive's comments, arguing that: 'Mr Duperrault's point was not that it was inappropriate to incorporate in one jurisdiction and be domiciled in another...His point was that any company receiving benefits from and creating risks for its place of domicile should be prepared to contribute to that place of domicile.'

Mrs Davis Johnson declined to comment on the exact size of the company's presence in the Cayman Islands, or the amount contributed by ACE to the jurisdiction's economy.

'The fact of the matter is, ACE creates no risk or problem and we have not hurt the Cayman's reputation or image as a jurisdiction by being incorporated there,' she explained, concluding that: 'The issue Mr Duperrault was addressing was the great damage done to Bermuda's good name and hard-won reputation by the negative publicity that resulted from inversions to Bermuda.'

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