Companies Amendment Act 1998

Link to law: http://www.bermudalaws.bm/Laws/Annual%20Laws/1998/Acts/Companies%20Amendment%20Act%201998.pdf

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now
Companies Amendment Act 1998
COMPANIES AMENDMENT ACT 1998

1

BERMUDA
1998 : 14

COMPANIES AMENDMENT ACT 1998

[Date of Assent 31 March 1998]

[Operative Date 1 April 1998]

WHEREAS it is expedient to amend the Companies Act 1981, the
Exempted Partnerships Act 1992 and the Overseas Partnerships Act
1995:

Be it enacted by The Queen's Most Excellent Majesty, by and
with the advice and consent of the Senate and the House of Assembly of
Bermuda, and by the authority of the same, as follows:

Short title and commencement
1 This Act may be cited as the Companies Amendment Act 1998
and shall come into force on 1 April 1998.

Amends sections 121 and 131 of Companies Act 1981
2 (1) In section 121(3) of the Companies Act 1981 (payment of
penalty by local company) for the words "one hundred dollars" there
shall be substituted "one hundred and fifty dollars".

(2) In section 131(3) of that Act (payment of penalty by
exempted company) for the words "two hundred dollars" there shall be
substituted "three hundred dollars".

COMPANIES AMENDMENT ACT 1998

2

Replaces Fifth Schedule of Companies Act 1981
3 For the Fifth Schedule to the Companies Act 1981 there shall be
substituted—

"FIFTH SCHEDULE

PART I (Section 121)

1 The appropriate fee in the case of a company whose business
includes the management of any unit trust scheme, shall be two
thousand four hundred and seventy dollars in respect of each unit trust
scheme managed by that company at the date of the declaration made
under section 121.

2 Issued capital Tax payable

When the issued capital of a company if a company limited by shares, or
other company having a share capital, is—

(i) less than $50,000 $550

(ii) $50,000 or more but less than
$250,000

$825

(iii) $250,000 or more but less than
$500,000

$1,375

(iv) $500,000 or more but less than
$1,000,000

$2,745

(v) $1,000,000 or more but less than
$5,000,000

$5,485

(vi) $5,000,000 or more but less than
$10,000,000

$10,450

(vi) $10,000,000 or more $15,675

In the case of a local company which is a mutual company, the tax
payable by such company shall be on the same scale as a company
limited by shares but the basis shall be the reserve fund of such a
company in place of that issued capital.

In the case of a local company which is a company limited by guarantee,
other than a mutual company no fee shall be payable.

In the case of a local company engaging in or carrying on wholesale
trading business in respect of petroleum and other oils or liquefied
petroleum gas the tax payable by such company shall be $15,675.

COMPANIES AMENDMENT ACT 1998

3

PART II (Section 131, 135)

1 A EXEMPTED COMPANIES (Section 131)

Conditions Fee

(a) Where the assessable capital
of the exempted company—

(i) is $0-$12,000 $1,695

(ii) is $12,001-$120,000 $3,460

(iii) is $120,001-$1,200,000 $5,340

(iv) is $1,200,001-$12,000,000 $7,120

(v) is $12,000,001-$100,000,000 $8,900

(vi) is $100,000,001-$500,000,000 $15,900

(vii) is $500,000,001 or more $26,500

(b) Where the exempted company's
business includes the management
of any unit trust scheme: in
respect of each unit trust scheme
managed by the company at the
date the declaration under
section 131(1) was made $2,470

(bb)(i) Where the exempted company
is a small foreign sales corpor-
ation which does not lease
aircraft $500

(ii) Where the exempted company
is a regular foreign sales
corporation which does not
lease aircraft $1,000

(iii) Where the exempted company
is a foreign sales corporation,
whether small or regular,
which leases aircraft $1,680

(c) (i) Where the exempted company
is one whose capital is denomi-
nated in a currency other than
Bermuda area currency or
currency of the United States of
America, and the Bermuda area

COMPANIES AMENDMENT ACT 1998

4

currency equivalent is $15,000
or less $1,695

(ii) Where the exempted company
is one limited by guarantee (but
is not a mutual company) $1,695

(iii) Where the exempted company
is one whose memorandum
provides that the company's
principal object is that of holding
beneficially all the shares in
another exempted company
which has, as an object speci-
fied in its own memorandum,
the object of carrying on insur-
ance business as defined in the
Insurance Act 1978 $1,695

(iv) Where the exempted company
is one whose capital is denomi-
nated in a currency other than
Bermuda area currency or
currency of the United States
of America, and the Bermuda
area currency equivalent is
$150,000 or less $3,510

(v) Where the exempted company
is one which is engaging in or
carrying on, in Bermuda,
wholesale trading business in
respect of petroleum and
other oils or liquefied petro-
leum gas $16,460

B PERMIT COMPANIES (Section 135)

Conditions Fee

(a) Where the permit company is one
which is engaging in or carrying on,
in Bermuda, wholesale trading
business in respect of petroleum
and other oils or liquefied petro-
leum gas $16,460

COMPANIES AMENDMENT ACT 1998

5

(b) Where the principal business of
the permit company is finance
business or insurance business
or, in the case of a permit com-
pany which is open-ended,
mutual fund business $3,510

(c) Where the permit company's
business includes the management
of any unit trust scheme: in respect
of each unit trust scheme managed
by the company at the date the
declaration under section 135 (as
read with section 131) was made $2,470

(d) In any other case $1,695

For the above purposes, the following expressions have the following
meanings—

"finance business" means the business of raising money from the
public by the issue of bonds or other securities;

"foreign sales corporation" means a company which—

(a) has been registered under this Act as an exempted
company; and

(b) has been designated as a foreign sales corporation under
the Internal Revenue Code, of the United States of
America, and has submitted to the Registrar a certified
copy of the document which—

(i) evidences such designation; and

(ii) specifies whether the company is a small or
regular foreign sales corporation;

"insurance business" means the business of effecting or carrying
out contracts of insurance or reinsurance as principal, but
excluding insurance management or insurance brokerage
business;

"mutual fund business" means the business of raising money
from the public for investment in real property, shares,
stocks or personal property;

"small foreign sales corporation" means a foreign sales
corporation which, under the Internal Revenue Code of the
United States of America, has been so designated;

COMPANIES AMENDMENT ACT 1998

6

"regular foreign sales corporation" means a foreign sales
corporation which, under the Internal Revenue Code of the
United States of America, has been so designated.

3 "open-ended company" means a company which has power
under the terms of its incorporation to redeem or purchase for
cancellation its issued shares at the option of, or on the request of, a
shareholder;

"unit trust scheme" means any arrangements made for the
purpose, or having the effect, of providing, for persons having funds
available for investment, facilities for the participation by them as
beneficiaries under a trust, in profits or income arising from the
acquisition, holding, management or disposal of any property
whatsoever.

4 Where a company liable to pay the higher fee in any year does
not carry on the business attracting the higher fee, it shall only pay the
lower. Where a company liable to pay the higher fee at any time during a
year carries on the business attracting the higher fee, it shall pay that fee
for that year."

Amends Exempted Partnerships Act 1992 and Overseas
Partnerships Act 1995
4 (1) In section 11(6) of the Exempted Partnerships Act 1992
(payment of penalty) for the words "one hundred dollars" there shall be
substituted "three hundred dollars".

(2) In section 24(3) of the Overseas Partnerships Act 1995
(payment of penalty) for the words "two hundred and fifty dollars" there
shall be substituted "three hundred dollars".