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The Companies (Prohibition of Bearer Shares and Nominee Directors) Amendment Act 2025 (the "Act") was passed in the House of Assembly on 21 November 2025. The Act received Assent and came into operation on 10 December 2025. The Act forms part of a suite of legislative amendments aimed to ensure Bermuda's compliance with the recently revised Financial Action Task Force (FATF) Recommendations.
The Act amends the Companies Act 1981 (the "Companies Act") and the Limited Liability Company Act 2016 (the "LLC Act") in relation to nominee directors, alternate directors, bearer shares and discontinuances to another jurisdiction.
Prohibition of Nominee Directors
The Companies Act has been amended to explicitly prohibit the appointment of any person, in any circumstances, to be a nominee director of the company. While the term "nominee director" has not been defined in the Companies Act, the FATF Recommendations refers to "an individual or legal entity that routinely exercises the functions of the director in the company on behalf of and subject to the direct or indirect instructions of the nominator".
Alternate Directors
The Companies Act has also been amended to require additional particulars to be disclosed with respect to alternate directors. In addition to existing requirements, the following must now be included in the register of directors and officers and filed with the Registrar of Companies with respect to each director:
- whether the director holds the position as an alternate director; and
- if so, the particulars of the existing director for whom the alternate director is appointed.
Discontinuance to Another Jurisdiction
Both the Companies Act and the LLC Act have been amended to require exempted companies and exempted LLCs discontinuing to another jurisdiction to appoint an agent in Bermuda to retain their beneficial ownership register and records of account for a minimum of five years from the effective date of discontinuance. Such appointment and retention of the beneficial ownership register, and records of account must be contained in an irrevocable deed poll that is executed by the company and its directors and filed with the Registrar of Companies.
Prohibition of Bearer Shares
The Companies Act and the LLC Act have been amended to reaffirm that legal persons are prohibited from issuing new bearer shares and bearer share warrants. The amendments also require that:
- beneficial owners of any bearer shares be notified of these requirements; and
- all existing bearer shares be converted to registered shares within 90 days of the Act coming into operation.
Once the 90 day period expires, any remaining unconverted bearer shares and bearer share warrants will be deemed null and void.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
