A Bill to provide more flexibility for the management and operation of Bermuda partnerships has been passed in the House of Assembly.

The Partnerships and Companies Amendment Act 2016 also clarifies the legal impact of certain changes in the constitution of limited partnerships, as well as certain activities of limited partners.

Furthermore, Grant Gibbons, the Minister of Economic Development, said it provides more clarity about the deregistration of Bermuda partnerships and the conversion of exempted companies to partnerships.

“This Bill introduces changes to the Exempted Partnerships Act 1992 to make the provisions governing relocation of partnerships into Bermuda consistent with those governing relocation of companies into Bermuda,” he said, adding that it is a continuation of the legislative reforms introduced last year to enhance and modernise the island’s partnership laws.

According to Dr Gibbons, the Companies Act authorised entities registered overseas to deregister from any jurisdiction and continue their business operations in Bermuda, whereas a partnership could only continue into Bermuda from an “appointed jurisdiction”. Those that were not in appointed jurisdictions had to dissolve their existing business and establish a new business entity in Bermuda.

Making the two consistent would “allow for a seamless transition into Bermuda without the need for dissolution of the foreign entity,” Dr Gibbons said.

“This flexibility is particularly important to clients looking to relocate their business operations to jurisdictions with laws that are more favourable to their business needs.

“With recent developments in global tax standards, Bermuda has an opportunity to engage in targeted efforts to attract more businesses to establish a physical presence in Bermuda.

“The ability to transition in a manner that facilitates and preserves business continuity is a strategic marketing tool for encouraging international clients to relocate existing business ventures to Bermuda.”

Dr Gibbons added that the Exempted Partnerships Act is also being amended to clarify that the effective date of deregistration for any Bermuda partnership will be determined by the date of continuation into the foreign jurisdiction. And the Companies Act 1981 will be amended to clarify “that conversion of an exempted company to a partnership does not require a company to wind up its affairs, nor does it constitute a dissolution of the company”, Dr Gibbons said.

Jamahl Simmons, the shadow minister of economic development, said the Bermuda Progressive Labour Party supported the act.

“The PLP’s position is that to be pro-Labour, we must also be pro-business, and support creating suitable environments that attract businesses, investment and jobs to Bermuda,” he said in a statement. “We further believe that Bermudians must come first in jobs and opportunities and that every effort must be made to ensure that our current and future Bermudian workforce is fully prepared for the opportunities presented if and when new businesses come to Bermuda.”

Also in the House of Assembly, a Bill changing the threshold at which houses come under rent control was passed.

According to Patricia Gordon-Pamplin, the Minister of Home Affairs, the Rent Increases (Domestic Premises) Control Amendment Act 2016 lowers the annual rental value ceiling from $27,000 to $22,800.

“This became necessary when the revised land tax rates brought into operation by the Land Tax Amendment Act 2016 on January 1, 2016, lowered the ARVs of many properties.

“By lowering the ARV ceiling, we will maintain the number of rental units under rent control. Those will be relatively unchanged at 17,061 units.

“If we do not lower the ARV ceiling, an additional 3,215 rental properties would become subject to rent control.

“By lowering the rent control ARV ceiling, the Government is providing stability and continuity to the rental market.”

Shadow home affairs minister Walter Roban said the PLP had no objections to the Bill, adding that he is aware the legislation was made to assist renters and those who have properties under rent control.

• To read the ministerial statement in full, click on the PDF link under “Related Media”