Finance Minister Eugene Cox confirmed yesterday that Bermuda will not be obliged to introduce annual filing of accounts by international companies in order to meet OECD standards for fair tax competition.

In a statement concerning the recent meeting in the Cayman Islands on information requirements, Mr. Cox announced that filing or auditing of accounts would be options but not obligations for jurisdictions that committed to OECD principles of fair competition.

This is good news for service providers such as law firms who frequently act as company directors for Bermuda companies.

An obligation to file accounts would have added a financial and logistical burden to the responsibilities of service providers and might have led to extra costs being passed on to clients.

Local service providers endeavour to keep such costs down in order to remain competitive, but this has to be balanced with the need to keep pace with regulatory requirements in comparable jurisdictions. In a recent interview with The Royal Gazette, Stephen Lowe, the Registrar of Companies, explained that there was a requirement in the Bermuda Companies Act to have annual accounts kept at the registered office, but companies did not have to send them in to be filed at the Registrar of Companies.

The filing of annual reports with the company registrar is a compulsory aspect of UK company law but is not viewed by local service providers as necessary to enhance Bermuda's reputation as a well regulated financial centre.

Mr. Lowe, who attended the meeting in the Caymans, said that during discussions with other delegates about regulatory frameworks, Bermuda's infrastructure emerged as “an enviable model”.

A spokesperson for Conyers Dill & Pearman law firm said: “Given Bermuda's existing ‘know-your-customer' philosophy and longstanding good reputation, we feel this is a positive and reasonable step for the OECD to take.”