Bermuda could pick up a significant amount of business from Canadian companies looking to form new captives but there is not expected to be a mass exodus of existing companies from its main competitor Barbados.That is the view of Jason Carne, partner in insurance at KPMG Bermuda, who was speaking on a panel about the Island as a new domicile for Canadian firms which included moderator Kilian Whelan, CEO of JLT Insurance Management, Heather Bisbee, assistant director of insurance licensing and authorisation at the Bermuda Monetary Authority (BMA) and David Lines, partner at Appleby, at the Bermuda Captive Conference at the Fairmont Southampton yesterday.Mr Carne said that despite the two rival jurisdictions sharing some similarities, Bermuda had the competitive edge in terms of level of regulation, quality of service provision, access to the re/insurance market and geographical proximity for Canadian businesses.The session followed the announcement by Premier and Finance Minister Paula Cox last week that the tax information exchange agreement (TIEA) between Bermuda and Canada, which was signed in June 2010, would come into effect at the start of next month. The agreement will mean that dividends of foreign affiliates resident on the Island that are paid to their Canadian parent companies out of the income earned in Bermuda will be exempt from Canadian taxation.Traditionally Barbados has been the main market for Canadian captives but now other jurisdictions such as the Cayman Islands, Netherlands Antilles and the Canadian province of British Columbia have already or seem poised to enter the fray.“I don’t think we’ll have a mass exodus (of Canadian captives from Barbados),” said Mr Carne.“I think the larger opportunity lies in new starts rather than existing captives.“With the redomiciles I am aware of a number of companies that are looking to redomicile which would indicate that there might be some movement.”Mr Carne said that in the past few decades Barbados had enjoyed a monopoly on Canadian captives driven by the tax advantages available to them, with approximately 250 entities domiciled there.He said that Bermuda’s TIEA with Canada would help to level the playing field, but one of the Island’s key differentiators was access to the re/insurance market as a one-stop shop for all their needs.Adding that there were several other advantages for Canadian firms choosing to base their captives in Bermuda from the strong relationship between the regulator the BMA and the industry and its common sense approach to regulation, the depth in quality of its service providers, to the close transport links between the two countries with flights two-and-a-half hours door-to-door between the Island and Toronto.“Nobody can rival Bermuda in size of captives and dealing in the whole set of captive issues,” he said.“I think Bermuda stands shoulder-to-shoulder with other jurisdictions, if not better, in terms of depth of infrastructure.“But one of the most important considerations for Canadian captives will be cost and I think we are competitive on that.”Mr Carne said that in the future Bermuda would be going toe-to-toe with other jurisdictions for business but he expected it to win a much larger share of Canadian captives than previously.Mr Lines said that a variety of factors, including being a mature jurisdiction and Solvency II coming into effect, put Bermuda in a leading position but there were many parallels between the Island and Barbados including regulators, classes of captives, capital requirements and incorporation fees.He said that the differences included Bermuda having a loss reserve test compared to none in Barbados.Ms Bisbee, who had started the session with some background on the BMA and the Canadian TIEA, pointed out that there were 27 Canadian insurers based in Bermuda worth $10 billion in assets and writing $240 million in gross premiums according to 2009 data.“What these figures mean are that Bermuda is open to business for Canadian captives and is bringing to the table the reputation, commitment to transparency, service providers and, of course, the appropriate regulation needed,” she said.