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Brexit could bring opportunities for Bermuda

Bermuda is “a step ahead” of the UK as it grapples with its exit from the European Union.

Ariane West, a partner in law firm Taylors, in association with Walkers, said the island's self-negotiated Solvency II equivalency status in Europe and work to gain an Alternative Investment Fund Managers Directive passport on a third country basis from the EU would continue as Britain unravels its relationship with the rest of the continent and attempts to build a working relationship with its former partners from outside the EU.

She added: “Because of the nature of Bermuda's relationship with the UK and because we are very much a self-governing territory, and we're already operating as a third country and have our own bilateral relationship with Brussels, we now have the opportunity to continue to build on this and take advantage of the fact that the UK finds itself in a very uncertain place which will likely continue for a considerable period of time.

“Bermuda has the advantage of offering consistency in what its relationship with the EU will look like.”

And Ms West said: “We're certainly one step ahead in this context.”

She added: “Usually, when you speculate, you can take it in a lot of different directions, but I think the reality is the UK is going to be seeking a positive and productive relationship with the EU going forward and Bermuda wants the same thing with both the UK and EU.

“I don't think speculation about terms or scenarios are something worth investing a lot of time or thought in — all parties will be seeking the most beneficial arrangements for their people and their economies.”

Ms West was speaking at the first “Breakfast Bites” session on Friday organised by the Bermuda branch of the international Alternative Investment Management Association, which has corporate members around the world.

She added that an AIFMD passport could “certainly be a boon to Bermuda's asset management industry”.

Ms West said: “Solvency II does provide a significant degree of comfort in terms of insurance groups domiciling themselves in Bermuda.

“That certainly bolsters Bermuda's position for the foreseeable future as a stable domicile.”

Earlier, she told the meeting that the UK had always had a sceptical attitude to “the European experiment.”

She said: “The fact that the UK public has elected to leave the EU has sent shock waves through the market. Europe has experienced its first setback of this magnitude.”

And she said that many of the political drivers behind the UK Brexit vote were “not aligned with the financial services industry, who voted overwhelmingly to remain in the EU”. Ms West said that Bermuda, as a UK Overseas Territory, was also recognised as Overseas Territory of the EU, and Britain's exit would mean the island would no longer have that access to that direct channel of communication through Britain.

But she added that Bermuda had a long history of negotiating on its own behalf in the international arena and would continue to do so.

Ms West said: “The opportunity and uncertainty and even instability caused by Brexit may be a source of opportunity for the Bermuda market.”

Around 90 people attended the breakfast session and AIMA Bermuda chairman Craig Bridgewater, a managing director at professional services firm KPMG, told the meeting the rejuvenated organisation was on the lookout for new members.

He added: “There are 1,700 corporate members around the world and we would like to see more Bermuda-based members as well.”

Dislocation: Britain's imminent departure from the EU will make Bermuda's relative stability seem attractive to asset managers, experts believe

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Published September 19, 2016 at 9:00 am (Updated September 18, 2016 at 10:21 pm)

Brexit could bring opportunities for Bermuda

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