Reputation is the key factor in differentiating captive insurance domiciles.That is the view of Tommaso Mascarucci, president of Black Gold Re Ltd, the Bermuda-based captive of Colombian oil giant Ecopetrol set up six years ago.Speaking in a session on the Island’s suitability as a domicile for Latin American captives at the Bermuda Captive Conference yesterday, Mr Mascarucci said Ecopetrol had thoroughly vetted 11 potential domiciles before plumping for Bermuda.Bermuda is the world’s leading captive domicile in terms of numbers. Its 862 operating captives make up some 17 percent of the world total.“We looked at 11 domiciles and we went through the criteria one by one,” Mr Mascarucci told his audience at the Fairmont Southampton.“We looked at the legal and regulatory framework, the quality and availability of service providers, and access to the reinsurance market. This created a lot of discussions on the board.“One key focus for us was reputation. A good domicile will have a good legal framework, so the rules you have to follow are clear. So we ended up in Bermuda.”Ecopetrol’s evaluation of Bermuda found the Island had transparency and regulatory stability, was favoured by the Organisation for Economic Cooperation and Development (OECD), had world-class service providers and easy access to reinsurance, and was also home to other captives in the oil and gas sector.Tax advantages had not been a major consideration, he added.The presentation attracted an audience including some visitors from South America. Nearly 600 people are attending this year’s conference, a record for the event.Also during the session, Eduardo Fox, a senior manager with Appleby, detailed how the tax information exchange agreement (TIEA) between Bermuda and Mexico, which took effect last year, had lowered the withholding tax rate applied by Mexico to Bermuda entities from its previous level of 40 percent.The change in tax treatment came after the TIEA meant Bermuda would no longer be considered a “preferential tax regime” (Government speak for ‘tax haven’, Mr Fox explained) under Mexican income tax laws.Attride-Stirling & Woloniecki corporate counsel Frederico Candiolo ran through the regulatory requirements for captives when incorporating and operating in Bermuda.In a question-and-answer session, the panel suggested that there were great opportunities for more insurance business from Latin America, particularly from Chile, Colombia, Mexico and Brazil.Mr Mascarucci said the rapidly expanding oil and gas sector offered great opportunities for Bermuda’s captive industry. “It’s a high-risk industry that needs a lot of insurance and a lot of capacity,” he said. “Captives are a useful tool to fit into their risk management strategies.”