BERMUDA Law and Practice Contributed by: Natalie Neto, Rachel Nightingale and Marah Smith, Walkers
4.6 Transparency Disclosure of the business purpose would be required if the applicant was seeking a Section 114B licence (ie, a local company was being acquired by foreign acquirers) or a Section 129A licence (ie, an exempted company pro - posing to conduct business in the jurisdiction). Such application is submitted to the Minister of Finance in Bermuda and must outline the impact of the acquisition on the Bermuda economy, the advantages/disadvantages that may result from the business being carried on in Bermuda and the impact on Bermudians and their job pros - pects, amongst other factors that will be con - sidered. If the company being acquired is regulated by the BMA or the Regulatory Authority, then it is likely that this will trigger a notification to the regulator under the applicable regulatory act as “change of shareholder controller” . In providing this notification, the target would be required to provide details of the potential purchaser, the reason for the acquisition and what is intended for the business post-acquisition, and such other information as may be required by the regulator. The regulator will have a period of time (typically three months) to serve a notice of objection to the change of shareholder controller. The exist - ence of direct lines of communication regard - ing the acquisition process often leads to the change of control application being processed prior to the expiry of the requisite time period, and this is often a precondition to any acquisition of a regulated entity in the jurisdiction. 5. Negotiation Phase 5.1 Requirement to Disclose a Deal Public disclosure is not required under the Com - panies Act. However, if the company is listed on
ing digital assets, as defined in the Digital Assets Business Act 2018 (DABA), the dealer would be required to hold a licence under DABA. There are limited exemptions available under both regulatory regimes. Where the derivatives are both traditional and digital assets deriva - tives, then the applicable regime would depend on the amount of gross revenues derived from each activity. Certain derivatives are available for trading on the BSX (eg, derivative warrants). If a person wished to trade derivatives of a Bermuda com - pany for its own account, it would need to uti - lise the services of a licensed broker/dealer and trading member of the BSX in the jurisdiction. 4.5 Filing/Reporting Obligations Except as described in 4.2 Material Sharehold- ing Disclosure Threshold , there are no specific securities disclosure requirements under the Companies Act and there are no competition laws in Bermuda. Where an entity is registered or licensed to pro - vide investment business or digital assets busi - ness services relating to derivatives, there would be both filing and reporting obligations on the entity that is providing such services to the BMA pursuant to the IBA and DABA, respectively, but these would apply to the entity rather than to any individual buyer or seller. Where a company lists derivative warrants on the BSX, there are obligations on the issuers to pro - vide price-sensitive information to the holders. Details of any changes to the terms and expiry of the warrants and of any purchase, redemption or cancellation of the warrants (among other things) must be provided to the BSX.
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