Japanese sign Tax Exchange Agreement with Bermuda

Bermuda Signs Tax Information Exchange Agreement with Japan

HAMILTON, FEBRUARY 1, 2010 - The Minister of Finance the Hon. Paula A. Cox J.P., M.P., announced today that Bermuda signed a bilateral agreement with Japan that provides for a full exchange of information on criminal and civil tax matters between the two countries. The signing of the Tax Information Exchange Agreement (TIEA) took place at a ceremony today at the Japanese Embassy in London and was attended by the Hon. Paula A. Cox, J.P., M.P., Minister of Finance and Deputy Premier, and Sumio Kusaka, Charges d'affaires ad interim, who signed the agreement for Japan.

Amongst those benefits accrued for Bermuda within the TIEA is a clause for Prohibition of Prejudicial or Restrictive Measures and a mini Double Taxation Agreement which provides benefits for students and pensioners.

Following the ceremony, Minister Cox said she was delight to have been able to sign the Tax Information Exchange Agreement with Japan, and was particularly pleased to note that Bermuda is Japan’s first TIEA partner. She said that negotiations with Japan were concluded in Bermuda in June 2009. At that time, the Japanese delegation stated that Japan intended to use the product of its negotiations with Bermuda as a model for all future negotiations with other financial centres for TIEAs. “We regard this as a tremendous compliment for Bermuda knowing that our work as an advanced financial jurisdiction is now used as a base from which other countries can work.”

“Already approximately 20-25% of Japanese Property Cat business is placed in Bermuda, as well as 5% of Property Pro-Rata business,” said Minister Cox. “With over 100 companies in Bermuda with Japanese interests, we see this agreement as enhancing opportunities for further foreign direct investment between our two countries and a great step forward in cementing the relationship between Bermuda and Japan. Moreover, this TIEA marks Bermuda’s nineteenth signed tax information exchange agreement, further demonstrating that Bermuda is far from complacent about our elevated position on the OECD white list and that we are resolved, as always, to implement the internationally agreed tax standard.”

“Bermuda currently works alongside Japan as members of the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes in our respective roles as Vice-Chair of the Steering Group and Vice-Chair of the Peer Review Group,” the Minister continued. “It will be our immense pleasure to welcome the Japanese delegation to Bermuda for the 2011 Global Forum.”

David Ezekiel, Chairman of the Association of Bermuda International Companies (ABIC) praised Bermuda’s achievement: “The signing of this TIEA with Japan after months of work and negotiation, coming on the heels of Bermuda being selected to host the 2011 OECD Global Forum, is another major step forward for Bermuda. Japan has a major involvement in the Bermuda market by way of ownership in the International Business sector and in trading with Bermuda-based companies. The treaty contains many useful benefits not only for the business sector but for individuals, including students who might be travelling to Japan for studies.”

Bradley Kading, President and Executive Director of the Association of Bermuda Insurers and Reinsurers (ABIR), echoed Mr. Ezekiel’s sentiments: “This TIEA is particularly noteworthy as Japan is the world’s second largest economy and Japanese insurers have been active participants in the Bermuda market for years. Japan has a natural interest in the hurricane and earthquake reinsurance provided by many Bermuda companies.”

Bermuda now has TIEAs with the following members of the G7: Japan, France, Germany, the UK and the US. In addition, Bermuda has TIEAs with Australia, Ireland, New Zealand, the Netherlands, the Nordic Group (including Denmark, Finland, Iceland, Norway and Sweden and their associated territories the Faroe Islands and Greenland), Netherlands Antilles and Aruba, and Mexico. Negotiations have been concluded with, among others: Canada, Spain, Belgium and Portugal, with these agreements anticipated to be signed in 2010.

Bermuda’s TIEA and Protocol with Japan includes all standard means to ensure due process is followed in tax information requests to Bermuda, including, for example, provisions to protect the confidentiality of information provided, as well as adhering to public policy, provisions related to protecting legal privilege, and anti-fishing provisions to ensure that requests for information from Japan are relevant to ongoing tax investigations being conducted by Japanese authorities.

Bermuda’s TIEAs are available for review on the Bermuda Ministry of Finance website at www.gov.bm.

-ENDS-

Contact:
Laura Semos
Treaty Advisor
Ministry of Finance
Tele: 297-7514
Email: ljsemos@gov.bm

Victor Webb/Bill Keegan
Marston Webb International
T: (212) 684-6601
e-mail: marwebint@cs.com

02.02.2010: | |