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EU considers Bermuda for blacklist

Bermuda has been added to a draft tax haven blacklist by the European Union, along with nine other jurisdictions, according to Reuters.

The news agency said it had been told by an EU official that the island, together with the United Arab Emirates, Oman and other Caribbean and Pacific islands, are included on a draft list that will go before EU envoys today.

It is up to the envoys to agree the new list, which will then be formally adopted by EU finance ministers in a meeting on March 12, according to Reuters.

Last night, David Burt, the Premier, said the island's Economic Substance Act and regulations meet the requirements of the EU, and that Bermuda “should properly be omitted from any list of non-cooperative tax jurisdictions”.

The Premier said technical officers and ministers are in daily contact with officials in Brussels, and representatives of key member states, to ensure “that it is clear Bermuda has met the requisite standard”.

He said: “This has been a difficult process, but I am confident that a fair examination of Bermuda's legislation in this area of economic substance will clearly show that we have complied with the standard required of us and we should properly be omitted from any list of non-cooperative tax jurisdictions.

“It is important to recognise that no decisions have yet been made.

“We look forward to implementing the new substance regime in Bermuda.”

Reuters reported that the official it had spoken with said the EU is still considering whether Bermuda and the UAE will be added to the list.

In 2017, the EU decided to blacklist jurisdictions that are non co-operative on tax matters, and to monitor countries that commit to change their tax rules to comply with EU standards.

However blacklisted jurisdictions could face reputational damage and stricter controls on their financial transactions with the EU, although no sanctions have yet been agreed by member states.

The five jurisdictions currently on the blacklist are American Samoa, Guam, Samoa, Trinidad and Tobago, and the US Virgin Islands.

According to the report by Reuters, 62 jurisdictions have committed to abiding by the tax standards set by Brussels, and most had been required to overhaul their rules by December or last month.

The news agency reported that Bermuda and the UAE have not complied by the set deadlines, but EU states are assessing whether their delays could be warranted.

Decision pending: the EU is reportedly considering adding Bermuda and nine other jurisdictions to a tax haven blacklist (File photograph by Dario Pignatelli/Bloomberg)

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Published March 06, 2019 at 8:00 am (Updated March 06, 2019 at 8:13 am)

EU considers Bermuda for blacklist

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