Business

Burt: Bermuda to be ‘less affected’ by Brexit

  • Talking points: David Burt was interviewed by Ian King, of Sky News, on Bermuda’s relations with the EU, what Brexit will mean for the island, and the Government’s drive to pioneer blockchain technology (Screenshot of Sky News)

Bermuda is positioned to weather turbulence from Brexit, and to meet European Union requirements in order to be removed from its greylist.

Those were the sentiments of David Burt when he was interviewed by Sky News in London, during a visit to Europe for meetings in the UK, Brussels and Estonia.

Ian King, Sky News business presenter, asked the Premier: “Bermuda currently sits on the EU’s greylist of countries under scrutiny for tax practices, what are you doing to try and allay those concerns?”

The EU has targeted jurisdictions that facilitate offshore structures or arrangements aimed at attracting profits that do not reflect real economic activity in the jurisdiction. It is requiring offshore jurisdictions, commonly referred to as the 2.2 jurisdictions — a reference to a criteria in an EU document — to implement new economic substance requirements.

In response to the question, Mr Burt said: “The EU has laid out some items regarding our funds legislation. In our local parliament on Friday, I believe, we will be passing amendments to those in order to satisfy the requirements of the European Union.”

In addition, he said Bermuda has 114 tax treaty partners where it transfers information automatically, and said Bermuda would continue to meet changing global standards. Mr Burt stated that Bermuda has some of the best anti-money laundering ratings in the world.

Mr King posed a hypothetical question about whether Bermuda would have to “raise its game further and tighten up on regulatory standards” if the US elects as president someone with a tougher stance on transparency “like Elizabeth Warren”.

The Premier said it would be difficult to raise the standards Bermuda all ready has, and added: “We have the gold standard of regulation, it is what we are good at. So from that perspective, the Bermuda standard is something that the United States and other countries would do well to meet.”

During the next few days, Mr Burt has scheduled meetings in London, including one with Lord Ahmad, in the Foreign and Commonwealth Office. He will also attend the Bermuda Executive Forum, and travel to Estonia to learn about technology that country is using to enhance its “E-Government”.

The Premier is also due to meet EU officials and ambassadors in Brussels. Originally it was planned that Mr Burt would attend the Joint Ministerial Council in London, along with leaders of other Overseas Territories. However, that meeting was postponed after a General Election was called in the UK, which will be held on December 12.

During the Sky News interview, Mr Burt was asked if Bermuda will be affected by the UK leaving the EU, he said: “Bermuda is less affected than some other overseas territories as we do not receive aid from the European Union.

“Additionally, we have relations with the European Union that are outside that from the United Kingdom. As I said there are only two countries in the world that have regulatory equivalence with both the EU and the United States, being Bermuda and Switzerland.

“That is something that Bermuda has outside of Brexit, and after Brexit that’s something that the United Kingdom will have to get on its own.”

The Premier spoke about Bermuda’s drive to pioneer blockchain technology. He said: “Digital assets is just another area of financial services, and just like the internet we recognise it as being the future of financial services.

“We want companies to innovate from Bermuda to provide innovative products to the world. The same as what we did in insurance, having a well-regarded regulator that allows companies to innovate.”

He expects to see the type of innovation and development that happened with the insurance industry in Bermuda, now happen inside the digital asset space.

“That is why we are promoting Bermuda as a jurisdiction that companies in the digital asset space can be successful.”

He said Bermuda was “a class apart” from competing jurisdictions, and added: “We have the best regulations that companies can come to build their products and services and sell them to the rest of the world.”