Bermuda Signs Tax Information Exchange Agreement with Mexico

HAMILTON, Bemuda--(BUSINESS WIRE)--The Minister of Finance Paula A. Cox, announced that Bermuda signed a bilateral agreement with Mexico that provides for a full exchange of information on criminal and civil tax matters between Bermuda and Mexico.

“We have worked assiduously to strengthen worldwide tax cooperation. We shall continue to build upon our long standing position of transparency and cooperation which has differentiated Bermuda from other jurisdictions.”

The signing of the tax information exchange agreement (TIEA) and Memorandum of Understanding (MOU) took place in Mexico City at the Nacional Financiera.

Mr. Agustin Carstens, Minister of Finance and Public Credit, signed on behalf of Mexico and Minister of Finance and Deputy Premier Cox signed on behalf of Bermuda.

Mexico’s Minister of Finance, in signing the TIEA and MOU with Bermuda, enables Bermuda to benefit from any current laws Mexico has in place, or which Mexico may initiate in the future, that enhance trade with its TIEA partners. Minister Cox said that she understands that no Government can preempt its Parliament and as such she was confident, that as in the case of France with its recent legislation targeting uncooperative jurisdictions, that Bermuda was now well-placed to benefit from existing Mexico law and any possible future laws pertaining to Mexico’s TIEA partners.

Minister Cox explained the significance of signing the TIEA with Mexico is that it will send a signal that will encourage Mexican nationals and corporations to position themselves to invest in Bermuda entities such as Bermuda mutual and hedge funds, and to establish captive insurance companies in Bermuda. By extension the TIEA will increase Bermuda’s attraction as a domicile to all members of ALARYS, the Latin American Insurance Association, which plans to hold a major insurance conference in Bermuda next year.

Government officials in attendance at the ceremony representing Mexico were Under Minister of Revenue, Mr Jose Antonio Meade, Armando Lara Yaffar, Director General of International Treaties, Ministry of Finance, Mr. Juan Carlos Trujillo, Under Director of Treaty Negotiations. Minister Cox was joined by Treaty Advisor Laura Semos and from the private sector, Mr. Eduardo Fox, who was a member of the original Bermuda negotiating team that negotiated the TIEA in Mexico City in 2006.

Bradley Kading, President and Executive Director of the Association of Business Insurers and Reinsurers (ABIR), said, “Mexico is exposed to earthquake and hurricane loss potential, very similar to the United States. Bermuda’s reinsurers are the leading providers of natural disaster catastrophe reinsurance and as a result we are logical providers of coverage to Mexico domiciled insurers. We provide 40% of the hurricane and earthquake reinsurance to North America. This tax agreement should contribute to additional cross border trade of benefit to Mexican business and consumers in need of financially strong risk takers.”

David Ezekiel, Chairman of the Association of Bermuda International Companies (ABIC) echoed Mr. Kading’s sentiments: “Coming just after the conclusion of negotiations with Spain and the signing of the TIEA with France, the signing with Mexico is further good news for the Bermuda international business sector as all three of these countries have a substantial involvement in our market. The signing of the TIEA will enhance those current relationships and should make Bermuda even more attractive as a domicile for prospective clients from Mexico.”

Bermuda’s TIEA with Mexico includes all standard means to ensure due process is followed in tax information requests to Bermuda.

Bermuda’s TIEA with Mexico is its 17^th signed agreement. Bermuda now has TIEAs in place with the following members of the G7: France, Germany, the United Kingdom, and the United States. In addition, Bermuda has TIEAs with Australia, Ireland, New Zealand, the Netherlands, the Nordic Group (including Denmark, Finland, Iceland, Norway and Sweden and their associated territories the Faroe Islands and Greenland), as well as Netherlands Antilles.

The Minister noted of these achievements: "We have worked assiduously to strengthen worldwide tax cooperation. We shall continue to build upon our long standing position of transparency and cooperation which has differentiated Bermuda from other jurisdictions.”

Bermuda’s TIEAs are available for review on the OECD website, at www.oecd.org.