BERMUDA Law and Practice Contributed by: Natalie Neto, Rachel Nightingale and Marah Smith, Walkers
that were delayed in 2024 but are now expected to be revisited. 1.3 Key Industries There has been a continued increase in the level of migrations into the jurisdiction due to Bermuda’s favourable tax treatment of shipping companies, which are excluded from Pillar Two. As Bermuda is a leading offshore domicile for fintech, there has been an increasing number of redomiciliations to Bermuda from other jurisdic - tions by companies seeking to obtain a licence from the Bermuda Monetary Authority (BMA) to conduct digital assets business and investment business activities. A number of Bermuda-based companies in the energy sector have also con - tinued investment in the jurisdiction. 2. Overview of Regulatory Field 2.1 Acquiring a Company Bermuda’s Companies Act 1981 (as amended) (the “Companies Act” ) offers a wide variety of options for structuring an acquisition of a com - pany. These include: • merger or amalgamation; • public tender/exchange offer for shares; • scheme of arrangement; • private purchase of shares; and • private purchase of the underlying assets of a target company. Statutory Merger or Amalgamation (Sections 104 and 104H of the Companies Act) Under Bermuda law, a merger is the combina - tion of two or more companies into one surviving entity. The surviving company will own the prop - erty of the original companies, and the respec - tive property and liabilities will vest automatically
by operation of law. The surviving company will continue to be liable for the obligations of the original companies. In comparison, an amalga - mation is the combination of two or more com - panies where the assets and liabilities vest in the new, amalgamated company. The Companies Act provides that the directors of each company proposing to merge or amalgam - ate must enter into an agreement that sets out the terms and mechanisms affecting the merger or amalgamation (the “Agreement” ). Section 105 of the Companies Act lists the requirements that must be contained within the Agreement, which include the requirement to state which class(es) of shares will be cancelled in exchange for the merger consideration (in the case of the seller’s shares) and which will be exchanged for new shares of the surviving companies (in the case of the buyer’s shares). It is possible for the merger consideration to comprise cash and/or shares in the surviving company or its parent. The directors of each amalgamating or merg - ing company must submit the Agreement for approval to a general meeting of the sharehold - ers. A notice of the meeting must be sent in writ - ing to each shareholder and include a copy of the Agreement, a statement of the fair value of the shares as determined by each amalgamat - ing or merging company, and a statement that a dissenting shareholder is entitled to be paid the fair value of his or her shares. Unless the company’s by-laws state otherwise, the Companies Act requires that notice must be given at least five days before the meeting and that the resolutions of the shareholders must be approved by a majority of 75% of shareholders voting at the meeting, and the quorum must be at least two persons holding or representing by
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