Bermuda Institutional Fund

The Investment Funds Act governs the exclusion, exemption and authorisation of investment funds and contains certain requirements for the formation of investment funds, their operation and the offering of shares, units or interests of investment funds. The Bermuda Monetary Authority (BMA) is the principal body responsible for the regulation of investment funds.

 

Key Features

Institutional Funds which are only open to qualified participants or require each participant to invest a minimum of $100,000 in the investment fund and it has an officer, trustee, or representative resident in Bermuda with access to its books and records.

A person is a ‘qualified participant’ if:

  • he/she is an individual who has such knowledge of, and experience in, financial and business matters as would enable him/her to properly evaluate the merits and risks of a prospective purchase of shares in the investment fund; or
  • he/she is an individual whose net worth or joint net worth with his/her spouse in the year in which he/she purchases an investment exceeds $1,000,000 (a ‘high net worth investor’); or
  • he/she is an individual who has had a personal income in excess of $200,000 in each of the two years preceding the current year or has a joint income with his/her spouse of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the year in which he/she purchases an investment; or
  • it is an entity in which all individual members, partners or beneficiaries (as the case may be) fall into the classes set out in (i) to (iii) above; or
  • it is a body corporate that has total assets of not less than $5,000,000, whether such assets are held solely by that body corporate or partly by any other body corporate of which it is a subsidiary or holding company; or
  • it is an unincorporated association or trust that has total assets of not less than $5,000,000.

 

Legal Requirements

Requirements

Description

General

  • Corporate  vehicle permitted

Company, Unit trust, Limited partnership

  • Local physical office required

No

Share capital or equivalent

  • Minimum subscription

USD 100,000

  • Minimum investors

None

Directors

  • Minimum number

2

  • Corporate directorship allowed

Yes

  • Local director required

No

Service Providers Required

  • Custodian

Yes

  • Fund manager/Investment manager

Yes

  • Fund administrator

Yes

  • Auditors

Yes

Tax Treatment

Bermuda investment funds are not subject to any tax, as there are no Bermuda corporation, profit, withholding, capital gains or income taxes applicable to an investment fund or to its share or unitholders or partners which are not resident in Bermuda.

 

Duration to Set Up

3 months

 

Distinctive Benefits of Licence

  • Low setup costs
  • Quick and easy regulatory notification process
  • No investment restrictions
  • Favourable tax environment

 

The Valsen Advantage

  • End to end comprehensive service
  • Speedy and efficient service
  • Expert advice on structuring options
  • Dedicated ongoing compliance support
  • Extensive network pool of service providers