Bermuda’s legal system

The Bermuda Bar is usually supplemented by 10 to 20 new members each year, consisting of Bermudians, spouses of Bermudians and guest workers.

Bermuda has a fused profession whereby there is no distinction between Barristers & Attorneys; both have a right of audience in the Bermuda Courts.

BAR COUNCIL

The Bar Council consists of nine elected members, who are chosen annually, as well as the Attorney General, ex officio.

General responsibilities of the Bar Council are laid out in Section 4 of the Bermuda Bar Act and include the following:

• the maintenance of the honour and independence of the bar
• the encouragement of legal education and the study of law
• the support of the public right of access to the courts and of the right of representation by members of the Bar
• the encouragement of improvements in the administration of justice and procedure
• the promotion and support of law reform
• the furtherance of good relations between the Bar Association and lawyers of other countries
• the issuing, revocation and suspension of practising certificates and such other matters of professional concern to barristers

PROFESSIONAL CONDUCT

Every Barrister & Attorney and Registered Associate, as well as every shareholder, controller, director and senior executive who exercises control of a professional company, must be a fit and proper person to engage in the practise of law. All Barristers, Attorneys and Registered Associates who wish to engage in the practise of law in Bermuda are required to apply for a Fit & Proper Certificate issued by the Bermuda Bar Council.

All members of the Bar are also bound by the Barristers’ Code of Conduct (1981), which requires that members carry out their duties to their clients, the Court, members of the public and their colleagues with integrity and in accordance with the Code of professional conduct. Furthermore, members of the legal profession are required to conduct themselves within or outside the professional sphere in a manner which is not likely to impair a client’s trust in them as a legal advisor. In addition to the aforementioned points, the Bar Council is also able to enforce stringent professional and regulatory standards via the provisions of the Bermuda Bar Act 1974 and its other supporting statutes; Bar Organisational Rules 1975, Barristers (Accounts & Records Rules) 1976, Barristers Code of Professional Conduct 1981, Bar (Practising Certificate) Rules 1984, Bar Disciplinary Tribunal Rules 1997, Bar Professional Conduct Committee Rules 1997, Bermuda Bar (Insurance) Rules 2009, Bermuda Bar (professional Companies) Rules 2009 and the Bermuda Bar (Barristers and Accountants AML/ATF Board) Rules 2018.

The Professional Conduct Committee (PCC) is the disciplinary body of the Bermuda Bar Association. It was created under the Bermuda Bar Act 1974 and operates under the Bar Professional Conduct Committee Rules 1997 and the Bar Disciplinary Tribunal Rules 1997. Broadly speaking, its principal function is to investigate and determine if there is a prima facie case of improper conduct against an attorney.

LEGAL EDUCATION

In order for a Barrister & Attorney to maintain a Practising Certificate, the Attorney must complete a prescribed period of Legal Education every year. In furtherance of this requirement, the Continued Legal Education Committee assist members by providing lectures on current legal developments, emerging issues, practise management and other areas of interest to practitioners.

In addition to setting continuing education requirements, the Bermuda Bar Association also provides guidelines for demonstrating that pupils have received the necessary training for Admission to the Bar. Typically, Admission to the Bar is achieved after 12 months of appropriate pupillage.

OPERATION OF THE BAR ASSOCIATION OFFICE

The Bar Association’s office has always been situated in the heart of Hamilton, first operating out of the very first President of the Association’s office back in the 1970s. The office has grown over the years into a location which serves its members daily, allowing for attendance at legal education classes, to conduct interviews for various scholarships/awards, meeting locations for Bar Council, the Professional Conduct Committee and any other ad-hoc sub-committees which debate matters such as new legislation.

With the building of The Commercial Court at the Government Administration building and the Dame Lois-Browne Evans Magistrates Court located on Court Street, the efficiency and experience of conducting legal business in Hamilton has been greatly enhanced.

Many of the Island’s law firms have recognised the benefits of close proximity to the financial district, Courts and Bar Association’s office by also occupying locations in the City of Hamilton. The result being a thriving business community in which participants are within close proximity of each other allowing for business to be transacted at a speed which many other jurisdictions find difficult to match.

FUTURE DEVELOPMENT OF BERMUDA’S LEGAL ENVIRONMENT

The Economic Substance Amendment Act 2019 (the “Amendment Act”) came into force on 28th June 2019. The Amendment Act, introduced to the Economic Substance Act 2018 and associated regulations (collectively, the “ES Regime”), to the concept of “a non-resident entity” i.e. an entity that is resident in another jurisdiction for tax purposes. The Amendment Act excluded non-resident entities from the scope of the ES Regime.

To benefit from this exemption, such entities are required to notify the Registrar of Companies (Registrar) of the jurisdiction in which they are claiming to be tax resident along with sufficient proof. The Registrar also provides a reciprocal arrangement whereby it will provide evidence of a non-resident entities’ claim of tax residency overseas to appropriate authorities. In furtherance of the objectives of the ES regime, the Registrar will disclose failures in compliance and instances where entities partake in high risk IP activities. Such disclosure extends beyond El.-J members where the holding entity, the ultimate parent entity, an owner or the beneficial owner is incorporated (formed, registered or resident as the case may be), to any such jurisdiction.

To meet the increased administrative burden that this regime has placed on non-resident entities, in June 2021 the Registrar introduced an e-registration system to accept and manage the information and data it collects. This online system is also an example of the modernisation of Bermuda’s legal system in response to the pandemic by digitising its services.

Legislation has also been introduced to overcome obstacles presented by COVID-19 such as The Commissioners For Oaths And Notaries Public (Electronic Notarization) Rules 2021 (the “Rules”) which came into force 1st October 2021. These Rules allow for documents to be notarised electronically, subject to certain conditions being met.

The Digital Asset Business Act 2018 (DABA) and Digital Asset Issuance Act 2020 (DAI) have provided a statutory framework in which individuals can operate digital asset businesses and issue digital assets. In order to conduct digital asset business in Bermuda, individuals must apply to the Bermuda Monetary Authority (BMA) for a license or consent. The BMA has worked closely with Island law firms to develop an international standard for the regulatory requirements that companies must follow. This recognition of the commercial applications of fintech and digital assets has attracted new companies to Bermuda hoping to expand into the burgeoning fintech industry.

In summary, Bermuda has made the necessary steps to modernise its legal system to meet the demands of the new ES Regime as well as shown its ability to evolve to overcome the unforeseen obstacles of COVID-19. This modernisation has allowed Bermuda to position itself as a jurisdiction of choice to companies entering into the digital asset industry.