The Companies Act 1981 sets out specific requirements to which every Bermuda company must adhere. These include requirements to have a local registered office address and to keep various statutory books at the registered office.
The registered office must be a physical address and not be a post office box. A corporate service provider will normally provide the registered office for a company, and supply a company secretary who is resident in Bermuda and is responsible for maintaining the corporate records, as part of its annual administration fee. The address of the registered office must be submitted to the registrar of companies who must be notified of any changes to that address. Any company that does not comply, or any officer who is in default, is liable to be fined.
Books of record must also be kept in Bermuda, normally at the registered office. Such records include:
- the register of members (shareholders);
- the register of directors and officers;
- the minute book; and
- books of account (financial records).
Members of each company must be entered into a register that includes the names and addresses of each member and the date each person was entered into the register. The register of members must be kept at the registered office of the company or, after giving written notice to the registrar, at another place in Bermuda that is convenient for inspection by members of the company and other persons entitled to inspect it. Additionally, a company with shares listed on an appointed stock exchange, or a company with shares that have been offered to the public pursuant to a prospectus filed with the registrar, may keep one or more branch registers outside of Bermuda after giving written notice to the registrar of the place where each register is kept.
All Bermuda companies, except those that have been filed and confirmed with the registrar as having objects that are exclusively charitable, must keep a register of directors and officers at its registered office. Any changes to the company's directors or officers, or changes to the particulars contained in the register, must be recorded within 14 days of their occurrence. The register of directors and officers is open to inspection by members of the public on request. Failure to keep a register, failure to properly record changes or refusal to allow inspection of the register, will result in the company being considered in default and liable to a fine in respect of each offence.
Each company must keep the minutes of all general shareholders' meetings and all directors' meetings at its registered office. As with all statutory records, it is essential that the minute book be kept accurate and up to date. A company's minutes not only are a definitive record of all decisions made by the company but also, have legal significance in that they are prima facie evidence of the proceedings of the company unless proven otherwise.
Where books of account (financial records) are not kept at the registered office in Bermuda, the company is required to keep at the registered office such records as will enable the directors or a resident representative of the company to ascertain the financial position of the company with reasonable accuracy. Proper records of account must be kept with respect to:
- all sums of money received and expended by the company, and the matters in respect of which the receipt and expenditure takes place;
- all sales and purchases of goods by the company; and
- the assets and liabilities of the company.
Failure to comply with these requirements will result in the company, and every officer, being liable to a fine of Ber$500.
While every Bermuda company must ensure that all requirements of the act are properly complied with, including those pertaining to the registered office, the keeping of the statutory books and records of the company, it may prove difficult without the assistance of an experienced corporate services provider. The corporate services provider will not only, provide the registered office for the company, but also ensure the proper maintenance of the company's corporate records.
For further information on this topic please contact Deborah Pharoah-Williams at Appleby by telephone (+1 441 295 2244), fax (+1 441 292 8666) or email ([email protected]).