Cox Defends Bermuda Over Insurance Allegations

by Mike Godfrey, Tax-News.com, Washington

26 February 2002

Bermudian Finance Minister Eugene Cox has hit out at media misrepresentations of the jurisdiction's regulatory regime. In particular, he cited an article in the New York Times last week, which claimed that US insurance companies were rushing to incorporate in Bermuda solely in order to avoid tax and duck under certain liquidity requirements.

'As a jurisdiction, Bermuda remains committed to operating in a transparent manner and to conducting quality international business with fit and proper persons,' Mr Cox asserted. He condemned suggestions in the article that incorporating a company in Bermuda was as simple as 'securing a maildrop', arguing that this statement implies that the jurisdiction takes a cavalier approach to incorporations.

'Anyone with a sound understanding of Bermuda's conservative approach to international business, based on our long-standing and recognised know your customer requirements...would know that this characterisation is false,' he explained.

Mr Cox denied the suggestion that the companies in question were being unpatriotic by choosing to incorporate in Bermuda, and defended their decision to retain 'working headquarters' in the US.

'This assertion could equally be made in relation to certain states in the United States itself, where it is commonplace, for business reasons, for companies to incorporate while not establishing any presence and maintaining an operating headquarters in another state,' he explained.

He also denied accusations that insurance companies incorporated in Bermuda are not required to ensure solvency in as stringent a fashion as those based in the United States.

Recommended