Economic Substance Amendment Act 2026

What this bill does

This bill transfers responsibility for monitoring Bermuda's economic substance rules from the Registrar of Companies to the Corporate Income Tax Agency (CITA). It gives CITA new powers to inspect businesses, require documents, visit premises, and impose fines on companies that don't meet economic substance requirements.

If passed (voted YES)

• CITA will take over enforcing economic substance rules, with power to inspect businesses and demand information
• Companies failing to meet substance requirements could face escalating fines from $7,500 to $250,000, plus daily penalties of $100-500
• CITA can ask courts to restrict or shut down businesses that repeatedly fail to comply with substance rules

If rejected (voted NO)

• The Registrar of Companies continues to handle economic substance enforcement instead of CITA
• Current penalty system and enforcement procedures remain unchanged
• No consolidation of international tax matters under one agency

Who it affects

This primarily affects Bermuda companies that conduct "relevant activities" (like banking, insurance, and holding company business) and must prove they have real economic substance in Bermuda. It also impacts the government agencies responsible for tax compliance monitoring.