April 27, 2018

Thank you, Minister.
That brings to a close those questions, unless
another Member has a supplementary.
No supplementary?
The other question that is on the Order Paper
for an answer, that a Member would like to ask a
question, will be the Statement from Minister Caines.
Minister Caines, you have a Member who
would like to put a question. That is the Honourable Member from constituency 10.
Honourable Member Dunkley, you have the
floor.

QUESTION 1: EXPLANATION OF THE
TERMINATION OF THE GVI INIT IATIVE
Hon. Michael H. Dunkley: Thank you, Mr. Speaker,
and I thank the Honourable Minister for his Statement.
On page 3, in the middle paragraph the Mini ster said, “The contract with NNSC was terminated for
a number of reasons,” and lists them. Can the Ho nourable Minister please provide the details of how much was paid to date on the date of the termination?

Thank you, Honourable Member.
Minister.

Hon. Wayne Caines: The outstanding balance to be
paid this year was, as stated, $200,000. So, math ematics, 370 . . . the outstanding was $200,000 for this year outstanding, left to pay.
Hon. Michael H. Dunkley: Thank you, the 170 . . .
are there any penalty clauses associated with the
termination?

Hon. Wayne Caines: No, sir.

Thank you.
Supplementary or new question?
New question? Continue.
[Inaudible interjection]

QUESTION 2: EXPLANATION OF THE
TERMINATION OF THE GVI INITIATIVE
Hon. Michael H. Dunkley: Thank you, Mr. Speaker.
Mr. Speaker, at the top of that page, the Ho nourable Minister says that the GVI model has had
some success. And he mentions that it was an u nbudgeted item for the last fiscal year. Does the Mini ster conclude that Pastor Bean is a budgeted or an unbudgeted item for the last fiscal year?

Yes.
Hon. Wayne Caines: Mr. Speaker, when we came
into the ministry there was a case manager who was
in situ. The case manager’s position is still there; there
is someone in that position. There was . . . (excuse
me) a GVI case manager. There has been a case
manager seconded to that department, seconded to
that department from another government ministry
who will deal with . . .
Mr. Speaker, and I crave your indulgence. A
huge part of this programme is to make it therapeutic. We believe that we needed a c ase manager for certain aspects of it, and we needed a case manager, someone who can look at when a person has a mental illness, or they need drug treatment support, or
when they need time finding employment or a house. And so, we knew that there were trai ned specialists in
other government departments. So we have an MOU with another government ministry, and that person has been seconded to our ministry, Mr. Speaker.

Thank you, Minister.

Hon. Michael H. Dunkley: Just for clarification. So
there is a case manager. The position is still filled, but
with a different person?

Hon. Wayne Caines: That is correct.

Hon. Michael H. Dunkley: Is the Minister in a position
to name the person? (Supplementary.)
Hon. Wayne Caines: Yes, Mr. Speaker. There i s no
secret. His name is Darren Woods.

[Laughter]

Hon. Wayne Caines: No secret.

Third question.

QUESTION 3: EXPLANATION OF THE
TERMI NATION OF THE GVI INITIATIVE

Hon. Michael H. Dunkley: Mr. Speaker, on page 2,
the Minister refers in a bullet point to creating em-ployment opportunities for those who may have prev iously been deemed unemployable because of their
past. Is the Minister in a position to give an update on
the 100 Jobs initiative by bringing a Statement to this
House?

Thank you.
Minister.
Hon. Wayne Caines: Yes, Mr. Speaker. We will bring
a Statement into the House as soon as it is practic able. But I will be happy to give an update. On that
evening . . . subsequent to that evening, we had 35
jobs with people being retrained, getting testing, having different opportunities out of that one initiative.
Now, Mr. Speaker, to look at that, just saying
100 jobs or what we did on that evening does not give
fair comment to the Minister of Education and Wor kforce Development. The people were trained. They
were triaged. They were met. They were guided.
There were needs assessments. We had interviews
with prospective employ ers. They met at the National
Stadium. We spent three different occasions meeting
with over 150 Bermudians who needed work, people
who did not have the right opportunity. They were put in specific buckets and allowed to get training opportunities. The trai ning is ongoing.
Mr. Speaker, we can say that out of that one
initiative in our first six months over 70 Bermudians have employment as a result of that initiative.

[Desk thumping]

Aha! So, we would like to wish you a
happy birthday on this day, Honourable President.
Thank you for indulging us on your birthday.
Now I acknowledge the Premier.

CONGRATULATORY AND/OR
OBITUARY SPEECHES

Hon. E. David Burt: Thank you, Mr. Speaker. Mr.
Speaker, good morning to you.
It has been some time since we have had the
opportunity to have this point in time in our agenda
here in the House. And while there have been many
occasions to celebrate and also to mourn, I would like
to, at this point in time, on behalf of the Government of
Bermuda in this place, though a statement was off icially made at the time of his passing, and I will ass ociate all Members of this Honourable House, if I may . . .

Yes.
Hon. E. David Burt: To acknowledge the passing of
Mr. Ira Philip, the former P LP Chairman, former Senator, one of Bermuda’s most profound journalists, au-thors, social commentators, photographers, and a
legend of Bermuda. We extend our thoughts and prayers, again, to his family. And we would sincerely
hope that an official letter could be sent from the
House. And I would trust that all Members will wish to
be associated with that.
In addition, Mr. Speaker, and keeping it here
on-Island, I would also like to ask that a letter of condolences could be sent to the family of the late Mr.
Ellsworth Christopher, beloved husband of Kathleen,
and father to Janel and Gina. As you will know, Mr.
Speaker, Mr. Christopher was a giant in local sports
administration, having served, of course, in every si ngle position at the Devonshire Recreation Clu b on the
executive, with the exception of treasurer, a position that I was proud to hold at that club and serve with
him. So, Mr. Speaker, of course, his service, I believe,
was on Tuesday. It was attended by myself, the Mini s-ter of National Security, and the Minister with responsibility for Social Development and Sports. And it was
a fitting send- off to a certain giant.
Mr. Speaker, also at this point in time, let me
please ask if the House itself would like to, of course, recognise the passing of another global giant which
has taken place since the last time we met. And that
was of the late Winnie Mandela, more fondly known in
South Africa as the Mother of the Nation. As an acti vist, a politician, and a member of the African National Congress, Ms. Mandela played a vital role in the en ding of white apartheid rule in South Africa. Her work,
her activism, and her legacy will continue to impact
political movements within her Africa region and internationally. May she rest in peace. Thank you, Mr.
Speaker.

[Desk thumping]

Thank you, Mr. Speaker.
I ask that I be associated with the comments
made by the Premier as they relate to all congratulat ory, or the obituary, speeches thus far.
I rise in this Honourable House, Mr. Speaker,
and ask that we send heartfelt congratulations to three
of our distinguished colleagues who were celebrated
just last weekend in a congratulatory dinner held in the East, marking their outstanding service to their
deserving constituency. While all three have disti nguished themselves in both private and public service,
I believe it is most i mportant to recognise them while
they are living amongst us and can receive their acc olades while they can still smell them.
Mr. Speaker, Minister the Honourable Lovitta
Foggo, JP, MP, Minister of the Government Reform, has selflessly contributed broadly to education, and on
entering politics, has held her own as she sat in the House in Opposition for five years as the Opposition
Whip. Her firm grip of parliamentary procedure and
her voluminous personality have served us and her-self well.
The Honourable R enee Ming, JP, MP, has
represented our party with distinction as the Senate Minority Leader, also in municipality governments in
the Corporation of St. George’s, and now in this
House as a Member of Parliament. Her buoyant and welcoming persona in her chos en profession, inclu ding banking and government committees and boards, has placed her at the fore of leadership in this party and gained the admiration of her Parliament, and also
her corporate, colleagues.
The Honourable Kim Swan, JP, MP, has, after
acce pting a rather overwhelming, timely, and divisive
1904 27 April 2018 Official Hansard Report

Bermuda House of Assembly political epiphany, joined the Progressive Party and
has made his mark, while assimilating seamlessly
from the former United Bermuda Party to the higher
calling at Alaska Hall.

[Laughter]

He has gained the praise, adm iration, and appreciation of the country and this House
for his leadership in sports, broad smile, welcoming
personality, and a true, genuine love for his country and his blessed St. George’s and the country at large.
On behalf of all of us who sit on this, the encroaching side of the Robin Hood corner, and the Government benches, —

[Laughter]

—we salute you as an invalu able part of the Progressive Government and a form idable PLP team. We thank you for choosing to be a
part of this substantive change currently sweeping the
Bermuda we love and cherish. In keeping with the
sentiment expressed at your celebratory celebration,
we on this side of the House love and appreciate you,
and thank you, all of you, for your dedicated and sterling collective service. Thank you.

I would like to have congratulations
sent to both of Bermuda’s CARIFTA teams. First, our
track and field team, specifically, Sakari Famous, who
was able to get a bronze medal in the high jump. And
Bermuda’s Swim ming Team came back with 32 medals, with specific accolades going to Logan Watson
Brown, who won the 13 to 14 age group for girls; and
Elan Daley, who within 11 events came back with 11
gold medals and seven CARIFTA records.

[Desk thumping]

Going on to our Commonwealth
Games team, I would like to congratulate the entire
team for representing Bermuda well, but specifically to
Flora Duffy, who has added to her World Champion-ship the Commonwealth Games Gold Medal. As someone who was part of her coaching team up until
the age of 16, I would like to specifically say that I am
proud of her accomplishment. And, obviously, I think
the whole House wants to wish her well tomorrow,
and everybody else who is participating in the Triat hlon.

[Desk thumping]

Thank you for your remarks.
Any other Member?
I recognise the Honourable Minister of Tourism. Honourable Minister, you have the floor.

Hon. Jamahl S. Simmons: Thank you, Mr. Speaker.
And I would like, please, to be associated with all of
the remarks that have preceded me.
I rise today to pay tribute to someone who
was a mentor, role model and, indeed, friend in the
form of the late, great Ira Philip. When I first returned
to Bermuda as a budding journalist and broadcaster,
he was always there with strong advice, strong opi nions, and relevant criticism. But I think that we do not
realise that the adage that a library bur ns to the
ground when its elder dies is truly, truly appropriate
here. Because the wealth of knowledge, the breadth
of experience, the sacrifice and the contributions he
has made to Bermuda are immeasurable.
And I hope that every Bermudian has the opportunity to read his works and learn about his life,
and I hope that in some small way, a little piece of him can be left in each of us.
Mr. Speaker, while on my feet, I would also
like to pay tribute to the Mother of the Nation, of our brothers and sisters in South Africa, Winnie Mandela.
It has been said that one man’s terrorist is another
man’s hero. And there have been some many who
have used the occasion of her passing to disparage the contribution that she made to the liberation of a people from one of the most wicked and degenerate
governments to ever, ever take place on the face of
the earth.

Yes.

Hon. Jamahl S. Simmons: When I think about the
sacrifice that she made, her husband taken from her in the night by the apartheid government, t hreatened
repeatedly, arrested repeatedly, tortured, abused,
beaten, well, we owe a lot to people who are prepared
to put themselves on the front line, put their life and limb at risk for the liberation and salvation of a people
and a just cause. And, Mr. Speaker, I salute her in
passing, as I salute her in life.
Finally, Mr. Speaker, I would like to have the
House take note of the Bermudian character and the
Bermudian conduct of Mr. David Frost, taxi driver and fantastic member of our community. He was reco gnised recently in the press by several tourists for his

B ermuda House of Assembly assisting them in recovering a purse that was lost. Mr.
Speaker, this is why Bermudians have the reputation
of being the best in tourism. It is the extra step. It is the extra effort. It is the extra attention that we provide for our guests. And that is why I truly believe that D avid Frost and people like him are why we will see Bermuda and Bermudians once again reclaim our
rightful place at the top of tourism at every level.
Thank you, Mr. Speaker .
[
Desk thumping]

Thank you, Mr.
Speaker.
Mr. Speaker, I would like to associate myself
with the congratulatory remarks made to our succes sful sporting teams, as articulated by the Honourable
Member Ben Smith. But, in particular, it does my heart proud, I am bursting with pride that the 11 gold medals that were garnered in one [CARIFTA] games by
one athlete all went to my great -niece, Elan Daley.
She is absolutely fantastic. She is a beast in the pool. And I am so, so proud of her. She did send me a pi cture of her with her 11 medals around her neck, and I am surprised that she was able to stand upright. I am
so proud of these young people.
I would like, at the same time, Mr. Speaker,
while I am on my feet, to ask that this Honourable
House extend remarks of condolences to the family of Arliss [Ronald] and Arian Francis on the passing of their son, Antony; as well as to the family of the late
Eugene Bean, who was a Berkeleyite. I think he act ually served in the class with the Honourable Leader who had . . . he passed all too soon.
Obviously, we would want to be associated
with the remarks of condolences to the family of the
late Winnie Mandela, recognising and understanding
her positive contribution not just to those in South A frica, but, by example, to the world at large.
And I certainly would ask to be associated
with the remarks of condolences to the family of Ir a
Philip. Mr. Speaker, Ira Philip, I have had the pleasure
of knowing him since I was quite young. Ira Philip
spent an awful lot of time at my home. He had an i ncredible admiration for my father. And there was no event, from my father’s passing in 1955, that I can recall being present that Ira Philip did not make it a point to be there.
He was a soft -spoken gentleman. He was a
decent gentleman. He gave of himself. He took the time to ensure that our history was immortalised in many of his writings. And I can only hope that he felt that some measure of what he gave to this country had been given back to him during his lifetime. Mr. Speaker, Mr. Philip and I did not share the
same political philosophy. But I could not tell you of any person whom I know, other than Dame Lois, with whom we had had interesting exchanges on the other side of the political divide, who took the time to show me their level of admiration, their encouragement, and their degree of acceptance at the fact that, notwit hstanding I had chosen a different political path, they
wanted to encourage me. That level of encourag ement is something that will remain with me forever. I am deeply appreciative. He used to say to me that,
You are definitely a chip off the old block, referring to
his knowledge of my dad.
[
Inaudible interjection and laughter ]

Thank you, Honourable Member.
I
recognise the Honourable Deputy Premier.
Honourable Deputy, you have the floor.
Ho
n. Walter H. Roban: Thank you, Mr. Speaker.
I would like to be associated with the condolences and congratulatory remarks already given. But
I would like to give perhaps an additional word of trib-ute to, certainly, Ira Pearman Philip, a former Member of the Legislature, chairman of my beloved party, and
certainly a giant of local literature and local historical
records.
Certainly, my own experience with Mr. Philip
would not only be contained within the experience within the PLP, but also from the standpoint of my i nterest in history and interest in his writings. And cer-tainly, for me, two of his books that I would regard to be some of the best writing that I have ever exper ienced were, one, his book, Freedom Fighters: From Monk to Mazumbo, which I think is one of the best
books ever written about Bermuda history. And second of course, The History of the Bermuda Industrial
Union —both of those books, I am sure, many persons
in the community have read multiple times over, be-cause they deserve to be digested in a way that helps you to understand the experience of history, not just the words, but the experience of the history upon
which they are covering.
And Mr. Philip had a way of writing in that
way. I do not have the experience of reading his co lumns as he would have outlined in the Bermuda R ecorder, or his time at Capital Broadcasting, of which
he was a pioneer broadcaster for a black owned and
1906 27 April 2018 Official Hansard Report

Bermuda House of Assembly run broadcaster who is no longer with us, other than it
is a part of the Bermuda broadcasting family. But it is
clear that he was a giant in broadcasting, in journa lism, in the coverage of Bermuda life and history. And I do hope that we all in Bermuda continue to be i nspired by his words that he not only gave in broa dcasting, but also on paper. And so, we as a country
must ensure that this happens.
I would like to be associated with the tribute to
Mother Mandela, Winnie Mandela, for her internation-al contribution to freedom and equality in her country, but also across the globe. Those of us who witnessed
the freeing of Nelson Mandela know that she was a
soldier in that struggle to free him and her country.
She was a mother who had to take care of her family, her household, and also a party, ANC, and the nation—a lot of work for one person, if you think about it.
And we should not tag her to certain other things that
people seem to tag her to continuously. She helped
build a nation that is now functioning as best as it can
for the interests of all of its people.
And, of course, I would like to be associated
with the other condolences as given already. Thank you very much, Mr. Speaker.

Thank you.
I recognise the Honourable Member from
constituency 7. The Honourable Member Richards,
you have the floor.

Mr. Sylvan D. Richards, Jr.: Thank you, Mr. Speaker.
Mr. Speaker, I would like to be associated
with the condolences given to the son of Mr. Arliss
[Robert] and Arian Francis, a good friend of mine, Mr.
Antony Francis, fondly known as “Monty,” who was
the President of Diamond Insurance Company. He
took over hi s father’s company upon his graduation
from Howard University.
Monty was a good friend of mine. I met him
when I was around 16 years old, when he was a st udent at Berkeley Institute and I was a student at Wa rwick Academy. We struck up a friendship that lasted from then until now. Monty and I left Bermuda in 1979
together to attend the university in Washington, DC.
He was accepted into the University of the District of Columbia, and I was accepted into Howard University.
And we left Bermuda together. And we were actually
roommates for about five months, staying in a little
room in a house in Washington, DC, that was owned
by a good friend of my grandmother’s.
And we were kind of like the odd couple. We
were very different in our personalities. But we were
good friends. And we supported each other, then,
through our careers in the insurance industry. And
Monty was a cheerleader of mine, especially in the political arena. When things would get a little hot up
here and I would get myself in a little bit of a si tuation,
he would call me up with a laugh, and we would laugh and giggle about it. And then he would say, You know,
Sylvan, just continue doing what you’re doing. He was
a really, really good friend. And friends like that do not
come by every day.
And I k now that there are others here who are
going to make contributions and condolences to his family. I am going to miss him. He was a wonderful,
kind gentleman. And I will cherish his memory. And I
just want to express condolences to all of his friends
and al l of his family. Even yesterday, I was walking in
the street, and about five or six people stopped me.
And we were just talking about Monty and his untimely
passing. So, I just want to send condolences to his
family. He will be missed.

Thank you.
Any other Member?
I recognise the Honourable Minister of Sport.
Honourable Member Weeks, you have the floor.

Hon. Michael A. Weeks: Thank you, Mr. Speaker,
and good morning.
I would like to start off my remarks by assoc iating myself with the remar ks of our Honourable
Premier, especially for Mr. Ira Philip. I would like the
House to recognise that one of his sons is sitting in
the Gallery.

[Inaudible interjections]

Hon. Michael A. Weeks: And when I was in university
with the Honourable Member, MP Richards, at Ho ward University, Mr. Quidell Philip was like a big brother
to us. So, my humble condolences go out to him and
his family.
Mr. Speaker, I would also like to be associated with the remarks for Mr. Ellsworth Christopher. I did
not come up a m ember of Devonshire Rec, but I was
always out there, and Mr. Christopher was like a f ather figure to many of us who dared enter the field or club at Devonshire Rec. He was a stickler for decorum
and respect. So my condolences go out to his family
also.
Mr. Speaker, I need to be associated with the
remarks for the Francis family, Arliss Antony Francis. Like the Member who spoke before me, we were all in
DC together. Monty, whom I had met probably a year
before we went to Howard, and Sylvan, MP Richards,
I met when they were in DC. And I am trying to hold
back a smile, because the times we had.

[Inaudible interjection]

Hon. Michael A. Weeks: No, no, no.

[Laughter]



Bermuda House of Assembly Hon. Michael A. Weeks: The times we had, Mr.
Speaker, have lasted us all these years later. So, my
heart goes out to Monty.
And I would like to associate MP Foggo, and I
would like to associate the whole House. Monty was the President, as you have heard, of Diamond Insurance Company, a small black business. And he
worked at it and worked at i t, and worked at it proudly.
And when Appleby . . . I saw that system. I did. So my
heart goes out, and I will miss him. I will miss his
jokes, his demeanour and just his overall friendship. You know, he was always there when you needed a
friend. He was not always in agreement with you. He
would give you that little chuckle and tell you his point
of view.
But, Mr. Speaker, as we pause to celebrate
the passing of our friends and our elders, I want to highlight some of our younger Bermudians and their
achiev ements. I want to, first of all, welcome back
home our under -17 women’s football team, who have
returned safely to the Island after riots broke out in
Nicaragua. I spent about three days —

[Timer beeps]

Good morning, Mr. Speaker, and thank y ou.
Mr. Speaker, I would like to be associated
with the heartfelt tribute and condolences as expressed by the Premier to the respective families and
the countries which they fought so hard to engender
progress in. That would be toward Mother of the N ation, Ms. Winnie Mandela, and, of course, Mr. Ira Phi lip. At a time when Western imperialism and the no-tions of white supremacy that so informed it, created societies based around racial hierarchy, both of those
individuals in their respective countries can be rightly
deemed as revolutionaries.
I would like to note that on the motion to adjourn, with your indulgence, Mr. Speaker, I would like
to speak a little bit more fully on the contributions of the great man, Mr. Ira Philip.
Moving on very quickly, I woul d like to also
associate with the comments directed towards Mr. Ellsworth Christopher, who, while many people will know was a leading educator ––there are dwindling
numbers of black males in our education system now –
–but certainly, he was a giant and much- needed figure in the teaching profession and our education system, I
think during the 1970s and 1980s. A great man. He
also was a sportsman, of course, as one of the leading players in some of those legendary Devonshire
Rec teams. He came into the team, I believe, during the era of Mr. Charles Daulphin. They went on
throughout that decade and beyond to be one of the
dominant teams in Bermuda cricket, frequently co ntending against my Southampton Rangers, which was
my cricket team.
Lastly, I just want to cong ratulate the me mbers of PHC (Pembroke Hamilton Club) Zebras, who took four trophies this year and missed out on getting
a fifth, where they would have had . . .

[Inaudible interjection and laughter ]

Where they would have
had all five trophies. But they did take four. It was extraordinary, Mr. Speaker, and they need to be commended. It is just so unfortunate that what turned out
to be a sort of minor fracas on Reid Street that night —
no one is saying it was pleasant to watch, but it was a
fairly minor fracas —leads to the Royal Gazette initially
putting more emphasis on demonising young black men, once again, out of all proportion to what actually
took place, and ignoring the seminal achievement of that team.
Now, they did subsequent ly give a story on
the team’s achievement and a great picture. But
again, it shows where the priorities are when it comes to the Royal Gazette. And they really need to look into
the mirror, because the community is getting very tired
of that.

Thank you.
I recognise the Deputy Speaker, the Honourable Deputy Speaker.

Hon. Derrick V. Burgess, Sr.: Yes, Mr. Speaker. I
guess I am going to have to change my seat so I can
be recognised.

[Laughter]

Hon. Derrick V. Burgess, Sr.: Because I have been
up so many times that, you know, I start to get tired.
[Inaudible interjections and laughter ]

1908 27 April 2018 Official Hansard Report

Bermuda House of Assembly Hon. Der rick V. Burgess, Sr.: About 10 people have
been before me and been up.

The Speaker had a blind spot over
there this morning. Now, my apologies to you, Deputy,
but I know you are still young enough to keep jumping
up.

Hon. Derrick V. Burgess, Sr.: I will get some lights
installed in this corner.
[Laughter]

Hon. Derrick V. Burgess, Sr.: But, Mr. Speaker, I
certainly would like to associate myself with the r emarks concerning Ira Philip who, in my opinion, was
one of the best writers I have e ver read. And his
books, as the Deputy Leader of the country has said,
Freedom Fighters: Monk to Mazumbo and the History
of the Bermuda Industrial Union are two books that
everybody should have in their possession, very good
books, history told. And I woul d hope one day that
The History of the Bermuda Industrial Union is inser ted in every school —not just one copy, but copies for
the students to have and use and put in the curric ulum.
Mr. Speaker, also Mr. Christopher at the Devonshire Rec. It has been said that if Devonshire Rec
needed some runs, some quick runs, they sent Big Al in and he gave you some sixes, hit the ball from Devonshire Rec way down to the Ducking Stool.
[Laughter]

Hon. Derrick V. Burgess, Sr.: And, normally, when
he did that, Devonsh ire Rec won the game.
Mr. Speaker, I would like to send condolences
out to the family of Mr. Antony Francis, a constituent
of mine. Antony took over the business of Diamond
Insurance from his father. I am sure at the time his
father was very proud to be a ble to hand it over to
him. Antony was a well -respected citizen of this country, a good constituent, and a good son to his mother
and father, Mr. Speaker. And also, a [good] husband
to Keasha, his wife.
Mr. Speaker, Antony certainly will be missed
by ever yone because every time you saw Antony
Francis, he was the same regardless of the situation. In fact, I saw him not so long before his death. He
looked like he was beating the battle. But he fought.
He fought hard, Mr. Speaker. But I am sure his mother
and father were glad to have him as long as they did
because he was, as I said, not only a good citizen, but
a good son and a good husband to his wife. And also,
a good brother to his sister. And he certainly will be
sorely missed by all. Thank you, Mr. Speak er.

Thank you very much, Mr.
Speaker.
Mr. Speaker, I rise to associate myself with a
few comments that have already been made. First, I
would like to associate myself with the comments
made in regard to Ms. Winnie Mandela and her contributions to the development of the South Africa that we have today.
I would like to also associate myself with the
comme nts made in regard to Ira Philip. Ira Philip was
a gentleman. He was a family man. He was a man
who was committed to education and the develo pment of young people. Mr. Speaker, I first met him
when I was attending Sandys Secondary School. And
his son, Quid ell, who is in the audience today, was in
my class. And I used to go over to their house at lunchtime to share lunch with them. And that is when I
got to know that this man was a true gentleman.
And his commitment —he served many years
as the trustee at the Sandys Secondary School, and
he gave unstintingly of his life and contributions. He
and his wife were cornerstones to Sandys Secondary
School, and I applaud them for their contributions in
the development of that school. In addition, I applaud them for r aising and educating all of their seven chi ldren to place them in a position where they are ma king contributions to this country.
I would like to also commend him on his art icles that he [wrote] in the Royal Gazette on an ongoing basis. They were historic al synopses of what went
on, and he brought them to life. To me, he was one of
the best historians of Bermuda’s culture that we have
today.
Mr. Speaker, the other person whom I could
speak about is Ellsworth Christopher. Mr. Christopher
was my first teacher, first male teacher at the Furbert
School. And I would say this: By far, from my academic career, he was the best male teacher that Bermuda
has ever produced. He was committed to education.
He was committed to developing young people. He
made them feel that they all can realise their potential,
Mr. Speaker. And as a consequence, he had a lot of
success stories because he made them believe in
themselves. And that is what is needed today with our
educational system and the teachers. He was a leader
in educ ation. I commend him. I salute him. And Bermuda has lost a Trojan educator for this country.

Thank you.
I now recognise the Minister for Government
Reform. Honourable Mem ber Foggo, you have the
floor.
Hon. Lovitta F. Foggo: Thank you, Mr. Speaker.
I would like to be associated with the remarks
for Ira Philip, a gentle giant indeed. And I can say, in
his later years, he spent much time in St. George’s.
And I am not talking about where he was infirmed at
the Sylvia Richards [sic] facility.

Well . . .
Hon. Lovitta F. Foggo: I want to say that because
every time I looked, he was down there. And I also
just want to acknowledge the fact that he was a friend
of my family. And his contribution to this Island was
phenomenal. And so, he will be definitely missed by
all.
Mr. Speaker, I also want to send out condolences to the Butterfield family, the Butterfield and
Swan families. As many may know, Quinton Butterfield, who did run for the PLP . . . I would like to ass ociate Kim Swan. I would like to associate Renee Ming.
That was his mother [Eunice Alene Butterfield]. But
more importantly, St. George’s [people] all know Ms.
Eunice Butterfield as the top beautician. She had her
beauty salon for longer than many of us who sit in this room have been alive. And she was able to raise her
family and educate her children because of that pr ofession. And, indeed, she was a matriarch of St.
George’s, and she will be missed.
Mr. Speaker, the last thing that I want to
speak to is the ROV [remotely operated vehicle] com-petition, the robotics competition, that took place earlier in spring. It took place up there at the National
Stadium, and in particular, I want to acknowledge the
success of those Clearwater Middle School and Del lwood public schools that earned most of the prizes. I would like to associate our Member Tinee Furbert with these remarks. I do have to say my constituency
school, Clearwater Middle School, was the top performing. In fact, I point this out simply because their
performance allowed them to be able to go overseas and—

[Timer beeps] The Speaker: Thank you, Minister.
Hon. Lovitta F. Foggo: I have not been up for three
minutes. You forgot to change the clock.

Would any other Member wish to
speak?
I recognise the Honourable Member, Mr. Moniz. Honourable Member Moniz, you have the floor.

Hon. Trevor G. Moniz: Thank you, thank you, Mr.
Speaker.
First of all, I rise to ask to be associated with
the condolences to the fam ily of Ira Philip. He was a
very fine man, very passionate in his beliefs, a very
good writer, and produced children who are a credit to
Bermuda.
Mr. Speaker, I would like to move on. I would
like to take this opportunity to offer my congratulations
to th e next Chief Justice Narinder Hargun. I would
associate certainly all of the Members of the House.

[Inaudible interjections]

Hon. Trevor G. Moniz: Well, we will get there, Ho nourable Member.
Mr. Speaker, I have certainly known Mr. Hargun for a very lon g period of time. I went to King’s Co llege in London, and he would have been across the
street at the London School of Economics [LSE] with
Julian Hall at that time. But I did not meet him until he
came here for a visit, perhaps in the late 1970s or
very e arly 1980s, when Julian brought him here so he
could have a look at Bermuda to see if he would come
and join his law firm. So, Narinder was there at the
LSE, I think, with Cherie Blair and with Julian Hall.
Narinder stayed there and did a master’s. I think he
did an LLM before doing his bar.
He came to Bermuda, and he has been an
outstanding practitioner at the bar. He is a very kind
man, a very knowledgeable man, very well respected
in the business community for his ability at commercial litigation. He w ill do us proud as Chief Justice. I
know the other candidates who had applied, you
know, will be disappointed; but someone had to win
the job. The Government have expressed some di sappointment, but I think that will be overcome when
he comes to sit. I was proud to be a member of the
1910 27 April 2018 Official Hansard Report

Bermuda House of Assembly recommending committee, when I was president of
bar, that recommended Dr. Kawaley for post as a
puisne justice, and Charles -Etta Simmons for her post
as a puisne justice. And I know what those respons ibilities are like when you have to pick someone to
move forward.
I think that the recommending committee who
made that recommendation for Mr. Hargun did a fine job. I think he will be a worthy successor to Dr. Kaw aley. And I think the Government will rue the fact that they have expressed any reservations. He has made tremendous contributions to this country. He is a very
kind gentleman. He is a very intelligent gentleman and
will be extremely even- handed.
Thank you, Mr. Speaker.

Thank you, Honourable Member.
I recognise the Honourable Member from
constituency 36. Honourable Member Scott, you have the floor.
Hon. Michael J. Scott: Mr. Speaker, I thank you.
Mr. Speaker, the symmetry of our condolences have been focused around two persons, I have noticed— in particular , Mr. Philip, Mr. Ira Philip, the
renowned journalist. And I would like to also add my
condolences by way of association to Mrs. Dorothea Tucker. May I start with her?
So, Mrs. Tucker, as my colleague and the
Honourable Member, Mr. Simons, indicated, took the
role and was a good stewardess of the fight for the five-day week, as she worked in her working life as a
member and worker in the hotel division. This dear
lady, Mrs. Dorothea Tucker, nee Burgess, was the
widow of Mr. Keith Tucker, another great unio n man
and member of our party. Wanting to be associated
with these matters are the Deputy Premier, the Mini ster of Cultural Affairs, Mr. Tyrrell —the entire House.
[Inaudible interjections]

Hon. Michael J. Scott: So, we mourn and celebrate
the life of Dorothea Tucker. And she leaves to mourn
her devoted and regal sister, Roslyn [Minors]; and her
brother, Bernell; and her nephew, the Deputy Speaker
of this House, the Honourable Derrick Vaughn Bur-gess. So we offer condolences to the family, to J oanne and Keith and Jody, her children.
Plainly, in relation to Mr. Ira Philip —and I recognise Mr. Quidell Philip in the House— Mr. Philip and
Mrs. Ismay Philip, if I may bring her into the picture, were a dynamic team, raising seven children in the Sandys Parish community. Ira, Jr., my peer, often had
me over to the home, that incredible . . . I think it must
be a listed home. It is a typical, classic architectural
square structure sitting on the promontory of Har-mon’s Bay. I used to go over there and, as a child,
marv el at the vistas. But what I marvelled more at were the rolls
that Ismay Philip used to make and the smells that
emanated from her oven, and the times that I was
blessed with eating and tasting her fare and wares
from the oven.
These two great Somersetoni ans did an excellent job at being community minded and community
spirited persons. Ms. Philip was the prime, principal soloist —

[Timer beeps]

Hon. Michael J. Scott: Is that my time, Mr. Speaker?

Good morning.
Hon. Jeanne J. Atherden: Mr. Speaker, I would like
to have condolences sent to the family of the late Mar-ion Edith Tatem. Marion Tatem had the distinction of
being the mother of seven children, one of whom was Judy Powell Benevides. And Judy, for a lot of you who
do not know, has been one of those people who has kept the OBA family going and lots of other political
families going. And we wanted to recognise the fact
that [Mrs. Tatem] was also the mother of Sandra Bu tterfield, Patrici a Cook, Jane Smith, Deborah [Ferguson], John Powell, Frank Powell, Skipper Tatem, and
Paul Tatem.
Mrs. Tatem was that lady who, when you
were down at the KEMH [King Edward Memorial Hos-pital] at the Pink Ladies, she was at the front desk.
She made sure that any visitor who had any problem,
she made sure that she took care of them, sometimes taking them home and making sure that they did not
want for being away from their families, because she
gave them that love you that need when you are away
and you have people who are ill. So we want to make
sure that the condolences go to her family.
I would also like to have condolences sent to
the family of the late Carolyn Audrey Saltus. I knew
Carolyn because she was the mother -in-law of my
cousin, Suriellah Adderle y, but also the wife of Mel
Saltus —also the mother of Mel Saltus and June, Vi ctoria, and [June] Saltus. So, from my perspective,
when you know someone and you know that they have reached the ripe old ages, and these ladies get
up into the 90s, I keep think ing to myself, I wish I can


Bermuda House of Assembly live as long as they lived, and I wish I could do as
many things as they have done.
In addition to that, I would like to be associa ted with the remarks sent to the family of the late Elton
Eugene Bean. For me, he was always Gene.

[Inaudible interjection]
Hon. Jeanne J. Atherden: Yes. As Member Patricia
Gordon- Pamplin will say, We had some nicknames. I
will not always say these in the House.
But Gene was an individual, and some of you
might know he was down at Bermuda Aviation Services, and he had a distinguished career there. But
also, he was quite involved in charities. And we used to sit on the Board of the Bank of Bermuda Foundation. And he gave of his time generously and was a lways out there.

[Timer beeps]

Hon. Jeanne J. Atherden: Thank you, Mr. Speaker,
and I watched the time.

Good morning, Mr. Speaker and
listening audience.
I would like to, first of all, be associated with
the kind remarks for Mr. Ira Philip, whom I got to know
personally through the African Diaspora Heritage Trail; and also, for Winnie Mandela, because, being a
woman, she was truly one of those persons who i nspired me and will continue to inspire me and other
women as years go by.
I would like to extend prayers to the family of
Cora Burchall. I would like to associate MP Swan with
that. And also just to give comment and prayer to the
family of Ms. Eunice “Pinks ” Butterfield. There is not a
St. George’s darling little girl who did not have her hair
done at Mrs. Butterfield’s place over the years. I recall the hot comb being in the thing, and doing that press.
And that was the first time I ever had my hair pressed.
So there are definitely memories there. She was mar-ried to Quinton for 66 years. She was a member of the
Richard Allen AME Church. And she did her beaut ician things in St. George’s for over 60 years. So, there
is definitely some legacy and learning that could be
held there.
I would also like to do a congratulatory one to
the Kings Pilot, James “Jemmy” Darrell. His family
continue to have an annual commemorative service
for him every year. And I thank them for allowing his
legacy to live on.
And also, I have two happy birthdays. Leroy
and Lucy Frith , from St. George’s. They celebrated on
the 24
th and the 26th, when he went 90 and she is 85. And this one is a special one, to Rozzy Simmons , over there at Spotlight Cafe. I am pretty sure I
can associate all of my PLP colleagues with this.

[Desk thumping]

Thank you, Mr. Speaker,
and good morning. I will try to make this within my
three minutes.
But I would like to start off on a very happy
note by sending congratulations to my cousins Chester and F ay Wilkinson of Ferry Road, celebrating 65
years, their 65
th anniversary. Great, great people. My
mother was actually one of the bridesmaids. And just
visiting with them recently, it was very nice to see pi ctures that you might not have come across until times such as these.
I certainly would like to thank the Honourable
Member from Sandys, Member Simmons , for those
kind remarks about the celebration dinner that was held. And also, I would like, in that vein, to send congratulations to Mr. Myron “Goat” Brangman; Raoul
Ming; Ms. Darlene Rogers ; Calix Todd; Ianthia Butler ;
and brother Doc Wayne, Doc Furbert —the real
Wayne Furbert, he says —

[Laughter]

—for their good work to
put on that event. And I am sure MP Foggo and MP Ming will be associated with that.
I would like to associate myself with the co ndolences offered to the fami ly of Ms. Cora Burchall,
Ms. Eunice Butterfield, on their passing. Certainly,
some great tributes have been paid to the life of Ms.
Winnie Mandela. I certainly would like to be associated with those, as well.
And, of course, Mr. Ira Philip, who spent many
a Cup Match at my camp. And the one thing I will always say is that his writing came through his passion. Because at Cup Match, he made sure the legacy of
Champ Hunt lived. As he wrote, he spoke. And I can
tell you, I know many folks from St. George’s in p articular would attest to the contribution Champ made to
their cricket, to the demise, on many occasions, of
Somerset, which I hope returns in the spirit of Champ Hunt soon, and very soon.
1912 27 April 2018 Official Hansard Report

Bermuda House of Assembly And also, I would like to be associated with
the condolences paid t o the family of Mr. Ellsworth
Christopher. I remember as a schoolboy in 1969 –
1970 when the arguments would be between the
teams of the rec and the teams of the bridge or the teams of Rangers. And when Ellsworth hit those g igantic sixes, that certainly was the talk of the town.
And Uncle Sheridan would say, Try to just keep it on
the ground. Don’t try to be like those guys who heave
them over the boundary. But he was well respected
for his life of service as a teacher, and also his club
service. Thank you.

Thank you, Mr. Speaker.
Mr. Speaker, first of all, I would like to be associated with the condolences to the family of the late
Ira Philip. As a number of Honourable Members have
already said, I always found him to be a real gentl eman. And I think it is certainly appropriate that the
House recognise him for his strong journalistic abi lities
and historical writings.
While I am on my feet, I would like to be associated also with the condolences to the Francis family on the loss of their son, Antony, and to the family of
the late Gene Bean. I had the pleasure of working with
Gene on a number of issues some years ago, another
gentleman.
And finally, Mr. Speaker, I would like to be associated with my honourable colleague Moniz’s con-gratulations to Narinder Hargun on his appointment as
Chief Justice. Certainly, a distinguished lawyer, by
Bermuda’s standards, and from my perspective certainly up to the task. Broad experience in commercial
and other law, and I think, from my perspective, certainly a very strong appointment.
Thank you, Mr. Speaker.

Thank you, Mr. Speaker.
Mr. Speaker, I also would just like to be ass ociated with the condolences for Mr. Ira Philip. I did not
get to know him closely, as some of our other Members did. But I would like to share that he definitely made sure that I got one of his books. So, it is in my
library, along with many other great books. I would like
to encourage all of our schools to make sure that all of
them als o have one of his books in their library.
Mr. Speaker, I would just like to also continue
on with the robotics competition that was held at the National Stadium, which my honourable colleague had mentioned. I would also like to associate Minister
Diallo R abain with these comments. And just to mention that Clearwater Middle School actually did so well
that they outperformed Bermuda College students and
have the opportunity to further their achievements by travelling overseas. So, I would just like to contin ue
with congratulatories for Clearwater Middle School in
the robotics programme.
I would also like to send congratulations to the
Kappa Classics. And I was tol d by Minister Weeks to
stand to attention when I mentioned the Kappa Classics. But for anyone who has run any sort of pr ogramme or activity, there is much work that goes into
organising. And so, the Kappa Classics had over
1,225 players who were represented within the Kappa
Classics. So I would just like to congratulate all of the
teams and all of the coaches who give their time to coach our boys and girls in soccer.
I would just also like to give congratulations
to—I was invited to the prize- giving for the Tabata- Ha
Shotokan Karate- Do (I am being corrected over here),
which is the karate association which actually practi ces in my constituency. And I had the opportunity to
attend the prize- giving and would just like to bring attention to that one of my constituents, Ms . Kiyari T albot-Minors , was recognised in high achievements academic -wise, as well a s in karate, within this prizegiving.
I just wanted to also congratulate . . . I do not
know if anyone had the opportunity to attend the Bermuda Youth Sports Expo, an excellent expo that was
done in our community to be able to expose our youth to the dif ferent types of sports that are out there avai lable. I am sure Minister Weeks would like to be ass ociated with that, as well as Ben Smith. It was an excellent opportunity to see all of the types of sports that
are available to our youth. And it even provid es a platform for parents to have access to that information.
Thank you.

Good morning, colleagues.
Mr. Speaker, it would certainly have been r emiss of me not to take advantage of this opportunity to associate myself with the condolences for two men
who have had an impact on my life. The first one,
Brother Ira Philip, as I kne w him, and Ellsworth Chri stopher. Mr. Philip, Brother Philip, was a person who
was the historian of everything, almost. And when I


Bermuda House of Assembly was looking to find some background information on
my lodge, he was the one whom I was sent to to get
the history. And I sat down with him for quite a while—
such a knowledgeable person when it came to that
subject.
The other person, Mr. Ellsworth Christopher —
now that’s a strange one because I was summoned to
a meeting many years ago, what I would call by the
big three in sports in Bermuda. It was St. George’s,
Somerset , and PHC at that time; they have probably
changed now. But I was summoned to this meeting by
the heads of those clu bs to encourage me to be President of the Bermuda Football Association. So, I have
to certainly thank Ellsworth Christopher for that, be-cause I probably would not have followed this path up here, as well.
Just switching gears, Mr. Speaker, I know the
even t has not completed, but it starts this weekend,
the International Triathlon. I would like to congratulate
the organisers of that, because I know the effort that has to go into that type of event. So, I would certainly, and I associate my colleague—the ent ire House with
that.
But the point I also want to make, I want to
encourage every Bermudian this weekend to get out
on the sides of the street, encourage the athletes. B ecause I think we are putting on an event that is world
class. Thank you, Mr. Speaker.

Thank you, Mr. Speaker.
I want to stand and, on a sad note, send condolences to the family of Wayne Jackson, who lost his
life and has passed on. I would like to associate the
entire House. And I would certainly like to send warm
messages to his children, Alisa, Anthony, Joanna, and
to his wife Juliette. This man, not only was he my firs t
cousin, b ut he was an example of an exemplary ge ntleman. This is a man who started his adult life at the
Blue Ja y Restaurant , which his father owned and operated as a black Bermudian family. They thrived as a family. They overcame obstacles and hurdles w ith
dignity, and they maintained their integrity. And with
calm steadfastness, he has held the reins of the Jac kson clan for his entire life and ended his life with the
same dignity. And so, I would like the House and
Bermuda to recognise this man and his legacy.
On a happier note, I would like to recognise
the young people at the CedarBridge Academy who
travelled overseas to New York last week for a virtual
entrepreneurship competition of sorts, which the
Berkeley Institute began in their school last year , the
Virtual Entrepreneurship programme. So it is Berk eley’s second year and CedarBridge’s first year. LaToya Francis is the teacher who has been
preparing these young CedarBridge students to create
an entire organisation, including a product, and be
able to represent this company and its product to a
vast arrangement of schools and students from
around the East Coast of America, and Bermuda gets
to be included in it. And I would like to recognise
Tamiko Douglas , who is the CEO of Pink Sands,
which is the name of their product. He did a wonderful
job. He was an award- winner while they were in New
York competing with other young entrepreneurs. And I
certainly send out congratulatory messages to all of
them.
And I would like to end by just recognising the
Centre on Philanthropy. They held a Community Day
last Sunday. And this is an opportunity for all of the
charities in Bermuda to come together and share with the community what they are doing, and also just to
raise awareness and to share in the joys of what it is
to be a community. The Victoria Park was full of chi ldren.
[Timer beeps ]

Good morning, Mr.
Speaker, and good morning to the listening public.
Mr. Speaker, I would like to start off by giving
condolences to the family of Ms. Marina Ottley , who
lived to 105 years old. I would like to give birthday
greetings to the “ Big Mama of Green Acres, ” Devo nshire, Ms. Rozzy Simmons , who feeds us every week.
Mr. Speaker, I heard everybody talking about
Mr. Ellsworth Christopher and slapping sixes. Well,
they are not mentioning he comes from Devonshire.
They are not mentioning he comes from St. Kitts. So,
that is natural for us.
[Laughter]

Mr. Spe aker, I do not know
how to put this. Two months ago, I visited a gentl eman down at Dorothy Crane. And in speaking with him, he said to me, Famous, young Famous, he said,
A luta continua. The struggle continues. Essentially,
he said, Don’t let the fact that we’re Government now,
again, be the be- all to end-all. We have to move our
people forward. He went on to quote something from
1914 27 April 2018 Official Hansard Report

Bermuda House of Assembly something he wrote, in February 2013. “The status of
moving forward and uplifting the economy out of the
doldrums will require as tute leadership. We cannot go
down the path again of instituting policies which cr eate economic and social entrenchment.”
Mr. Speaker, the gentleman I am alluding to is
the great Ira Philip, someone whom everybody has
spoken about today and someone whom w e cannot
just speak about his history; we have to think about
what he set in path for us. So I would like for ever ybody to meditate on the fact that the struggle conti nues. Thank you. Mr. Speaker.

Thank you, Honourable Member.
I thought we w ere coming to a close. I reco gnise the Honourable Member from constituency 10.
Honourable Member Dunkley.

Hon. Michael H. Dunkley: Thank you, Mr. Speaker.
Maybe in three minutes, we will.
Mr. Speaker, I ask to be associated with the
most fitting tributes to Winnie Mandela [and] to the
Philip family. I recognise Mr. Philip in the C hamber
here today. To the Christopher family. Most people do not know, when I was growing up, I was a big Devonshire Rec cricket fan. To the Francis family and the
passing of Ant ony, way too young. To Mrs. Tatem. To
Gene Bean and his family. And obviously, to a stellar
gentleman, to Wayne Jackson.
Carrying on to that, Mr. Speaker, I would like
for this Honourable Chamber to send condolences to the Grant family for the passing of Marjorie Grant earlier this month, I think earlier in April. My honourable
colleague, Pat Gordon- Pamplin, and the Leader of the
Opposition, Jeanne Atherden, would like to be assoc iated with that, specifically to her two children, Sonia
Grant and Senator Mi chelle Simmons, who sits in another place.
I would also ask these Honourable Chambers
to send condolences to Teddy Chapman on the pas sing of Nancy Chapman. And my honourable col-league, Dr. Gibbons, and our honourable colleague
Cole Simons, who has put hi s hand up like he is in
school, would like to be associated, and the Oppos ition Leader, as well. Nancy Chapman––I have known the Chapman family for many years, Mr. Speaker. And like the people we have paid tributes to earlier
today, an outstanding person, married for 62 years. A
teacher, she certainly contributed greatly to our community in many ways. And so, Teddy will sorely miss
the rock in his life, Mr. Speaker.
Turning to a brighter aspect, Mr. Speaker, I
would like to be associated with the congratul ations
sent by MP Furbert to Kappa Classic. They weathered the weather up there.

Hear, hear!
Hon. Michael H. Dunkley: It was an outstanding
turnout, and the organisers need to be congratulated.
I would like to join in the congratulations by
my honourable colleague, Ben Smith, to all of our at hletes, and specifically to Flora Duffy on the Commonwealth Gold.
But, Mr. Speaker, Mr. Smith, the Honourable
Member , is too humble. I would like to send congrat ulations to him —he has taught and coached many of
the swimmers for a number of years —for his dedic ation, not only in the political field, but to the field of swimming , and our young people.

[Desk thumping]

Hon. Michael H. Dunkley: And the Honourable
Member, I think, Kim Swan, wants to be assoc iated.
Mr. Speaker, I will close by sending heartfelt,
warm congratulations to the organising team at the Ag
Show for a stupendous job. David Lopes, Jeff Sousa,
Antwan Albuoy, Peter Barrett, Talia Simmons, Kim
White, Toddy Minors, Lisa Dawson, Tanya Jones and
Kirk Kitson —excellent work! And they even got the
right weather for three days, Mr. Speaker.
And my final, closing remark is to a former
colleague of this place, Mr. Glen Smith. If I did not
announce and recognise his championship as a champion drivi ng horse, with JS Magic . . . (He would
not let me mention it.) But, Mr. Speaker, I think the
horse was pulling the carriage and Mr. Smith was just
sitting there for his looks. But, congratulations !
[Laughter]

Thank you, Honourable Member.
I think that brings us to a close of condolences
and congratulations.
But before we move on, I would just like to
add my name to a couple of comments, particularly
that to the Philip family. As much has been said, and it
is true, that Mr. Philip was tr uly a giant of his era and
will always live on for what his contribution has been to Bermuda.
I would also like to acknowledge and mention
another Somerset person, Mrs. Tucker. And Mrs. Tucker, likewise , was a member of one of those fam ilies that were inst rumental to moving things in Somerset on political and social levels.
Finally, to the family of Antony Francis, in that
on a business level we had a close relationship. And I am sure the loss to his family is dear and extreme at this time, and I would lik e to be associated with that.

ANNOUNCEMENT BY THE SPEAKER

HOUSE VISITORS

I believe we have three Bills to be i ntroduced today. And I will recognise the Deputy Premier, who is going to i ntroduce the Bill on behalf of the
Premier.

FIRST READINGS

PUBLIC SERVICE SUPERANNUATION
AMENDMENT ACT 2018

Hon. Walter H. Roban: Thank you, Mr. Speaker.
I am introducing the following Bill for its first
reading so that it may be placed on the Order P aper
for the next day of meeting: Public Service Superannuation Amendment Act 2018.
Thank you, Mr. Speaker.

Thank you, Deputy Premier.
The next Bill is in the name of the Minister of
Education, who is not present today.
So, Minister Foggo, w ould you want to intr oduce it for him? DEPARTMENT OF LIBRARIES AND ARCHIVES
(AMALGAMATION ) ACT 2018
Hon. Lovitta F. Foggo: Yes, thank you, Mr. Speaker.
Mr. Speaker, I am introducing the following
Bill for its first reading so that it may be placed on the
Order Paper for the next day of meeting: Department
of Libraries and Archives (Amalgamation) Act 2018.
Thank you, Mr. Speaker.

The last Bill to be introduced is that in
the name of the Honourable Minister Wilson.
Honourable Member.

EVIDENCE (AUDIO VISUAL LINK) ACT 2018

Hon. Kim N. Wilson: Thank you, Mr. Speaker.
I am introducing the following Bill for its first
reading so that it may be placed on the Order Paper
for the next day of meeting, namely, the Evidence
(Audio Visual Link) Act 2018.

We are now at the Orders of the Day.
With the indulgence of the House, Order No. 2 is g oing to be done first. And we will do Order No. 1 afterwards, which will be the more substantive matter.
The Honourable Junior Minister, will you do
Order No. 2?
Hon. Wayne L. Furbert: Thank you, Mr. Speaker.
Mr. Speaker, with the Governor’s recommendation, I move that the Bill entitled the Companies
Amendment Act 2018 be now read the second time.

Take your time.
BILL
SECOND READING
COMPANIES AMENDMENT ACT 2018
Hon. Wayne L. Furbert: Mr. Speaker, the Bill now
before the House is the Companies Amendment Act 2018. The Bill relates to the filing of specified compa-ny bye -law information with the Registrar of Companies [ROC] . Mr. Speaker, Honourable Members will
recall that the standard for the transparency of benef icial ownership and control of legal persons and legal arrangements is set out by the OECD Global Forum, the Revised Financial Action Task Force recommen-dations , and incorporated into the UK Exchange of
Notes Agreement.
The goal of these international standards r egarding beneficial ownership and control is to estab-lish legal and regulatory regimes that deter and pr event the misuse of legal persons and legal arrange-ments for the purpose of money laundering and f inancing terrorism.
Mr. Sp eaker, the Proceeds of Crime (Miscellaneous) Act 2018, which was debated and passed by the Legislature in March of this year, introduced a raft of legislative amendments to address certain legisla-tive gaps in Bermuda’s anti -money laundering and
anti-terror ism financing regime in preparation for the
upcoming set of mutual evaluation assessments. One such amendment relates to the filing of basic infor-mation, spe cifically company bye-laws. FATF [Fina ncial Action Task Force] requires that the basic regulat-ing powers of such companies should be held in the
central regi stry. The company memorandum of ass ociation and articles of association are generally considered by FATF to be the basic regulating powers of a company. Bermuda does not have articles of ass ociation; ho wever, the bye -laws perform similar fun ctions as articles.
Mr. Speaker, the requirements for every company to file specified bye-la w information by the Proceeds of Crime (Miscellaneous) Act 2018 followed
consulta tion with the legal profession and NAMLC
[National Anti -Money Laundering Committee]. This
legislation amended the Companies Act 1981 by adding a new subsection (g) to section 13(2), requiring
every com pany make provisions in its bye -laws for
filing with the Registrar of Companies informati on
specified in sec tion 13(2)(a), (e) and (f) of that Act.
Mr
. Speaker, following the passage of that
Act, further representations were made by the legal
profession requesting that the Companies Act itself ought to make filing of such information a requir ement
rather than a bye -law requirement. This method will
create a statutory obligation on every company to file the information specified in section 13(2)(a), (c) and (f). And that is information such as share transfer up-on death of a shareholder, the duties of the secretary of the company and how many members constitute a
quorum at a general meeting.
This way, the filing requirement will be more
cost-effective and efficient for companies and their
corporate service providers. Accordingly, this Bill r epeals section 13(2)(g) and replaces it with a new section that simply requires every company to file with the Registrar of Companies that information specified in
section 13(2)(a), (e) and (f).
Mr. Speaker, this Bill also provides a six -
months transitional period to allow companies to com-ply with this new requirement in a timely fashion, in order for the repeal of section 13(2)(g) to be replaced
with a new subsection (2)(a) , seamlessly. This Act will
be deemed to come into operation on 21
st of March
2018 —
[Inaudible interjections]
Hon. Wayne L. Furbert: —the operational date of the
Proceeds of Crime (Miscellaneous) Act 2018. Ther efore, companies will have unt il 21st of September 2018
to file the required bye-laws information.
With these brief comments, Mr. Speaker, I
invite other Honourable Members to participate.

Thank you, Mr. Speaker, and
good morning.
Mr. Speaker, as the Member has said, this is
just in keeping with all of the housekeeping work that
we are doing in respect of the CFATF review and continuing under the requirements to be transparent. The
bye-laws of a company are generally an internal governing document. And the reason, I think, that we do not want to have to file bye-laws is because they can
contain sensitive information.
So I just have a couple of questions to ask in
terms of this legislation. I am not sure what the goal is to filing the transfer of share form or the registration of estate representatives. The duties of the secretary of a company are already set out in the legislation, so I do not know what filing that document is going to achieve. And then, the other one is the quorum for a
general meeting. My question is, why these particular
documents, and what is going to be, or hoped to be, obtained by filing these particular documents?
I would also like to know whether or not there
is going to be a prescribed form for these documents. Do we have . . . sorry?


Bermuda House of Assembly [Inaudible interjections]

Thank you, Honourable Member.
Does any other Honourable Member wish to
speak?
I recognis e the Honourable Leader of the O pposition. Honourable Member, you have the floor.

Hon. Jeanne J. Atherden: Sorry, Mr. Speaker. Just a
couple of questions.
And in keeping with my colleague, we understand that some of these things are put into place b ecause of the CFATF review, and therefore, you know,
some of our questions are because we want to make
sure that, while we make sure that we are on the right
side of the review, we do not end up creating a problem with respect to the information that companies
have.
But I think the one question that we want to
ask, and I might as well ask it right now before we get into Committee, is the fact that it is indicated that this
is going to come into effect on the 21
st of March. And
although the Explanatory Memorandum says that it is
because that is the date the Proceeds of Crime (Mi scellaneous) Act [2018] came into effect, it also does
mean that it is effectively retroactive, and then the
clock starts ticking. Thank you, Mr. Speaker.

Clauses 1 through 4.
Any objection to moving clauses 1 through 4?
There appear to be none; continue.
Hon. Wayne L. Furbert: Mr. Chairman, the explanation regarding the Bill as far as . . . let me give an
overview of the order [sic].
The Companies Act 2018 amends the Companies Act 1981 (the Act) to require companies to file
with the Registrar of Companies that information that
every company is required to include in its bye- laws,
as prescribed by, what I said, section 13(2)(a), (e) and
(f). The Bill seeks to repeal the newly amended section 13(2)(g). So, clause by clause, let us look at the
clauses.
Clause 1 is the standard citation clause. I do
not think we have much problem with that.
Clause 2 amends section 13 of the Companies Act 1981 by repealing subsection (2)(g), and r epealing and replacing the existing subsection (2A) with new subsections (2A) and (2B). The new subsection (2A) requires every company to which subsection (2) applies to file with the Registrar the information that the company is required to include in its
by-laws as prescribed, as we said, to subsections
(2)(a), (e) and (f). The new subsection (2B) provides
that information obtained for the purposes of subsection (2A) shall not be made available to the public.
Clause 3 is the transitional provision, mandating that every company to which section 13(2A) of the
Act applies will have a period of six months from the
coming into operation of this Act to be in compliance with that section.
Clause 4 deems the Bill to have come into
operation on March 21, 2018 (the date on which the Proceeds of Crime (Miscellaneous) Act, being the Act
that contained the recent amendment that we made to
section 13 of the Companies Act 1981, c ame into operation). Thank you, Mr. Chairman.

Thank you.
Just going back to my questions.
One, what benefit is [there in] obtaining the i nformation requested from section 13(2)(a), (e) and (f)
of the Act?
Two, is there going to be a prescribed form for
the submission of this information? Is there going to be a filing fee for the filing of
this information?
And, will there be annual filings required, or
will filings only be required as and when there is a change to the documents, and in particular, the share
transfer or the duties of t he secretary or a change in
the quorum for a company?
There is a six -month period that the legislation
comes into operation. If the documents are not filed
within that time, is there a penalty or a consequence for not filing the documents?
And is clause 4 correct that this Act is deemed
to have come into operation on the 21
st of March
2018? And those are my questions. Thank you.

Thank you, Mr.
Chairman.
Mr. Chairman, I wonder if the Junior Minister
could respond. Given the indication that this is a retr ospective, effective retrospective or retroactive Bill, the
existing companies —will there be some oversight
coming from the Registrar to let companies know that
this is coming into effect and, therefore, this information is now needed? Or is the onus being left to the companies to tune into the fact that there have been
changes and there is something else that must be
done wi th respect to compliance?
I think it is important to know that some of the
companies, obviously, if they are unaware, there are
certain compliance functions that exist in some organ-isations. But some are not, perhaps, as robust as they
might otherwise be. So when there is something that
is required and it is retroactive, somebody needs to
trigger a notification. And I am wondering whether this is going to be done by the Registrar of Companies, or
whether the onus is going to be left to the companies
to mak e sure that they are in compliance.

Any further speakers?
There appear to be none.
Junior Minister, do you want to reply?

Hon. Wayne L. Furbert: Mr. Chairman, we are all
aware about the assessment this year. And there were certain requirements that NAMLC required. This Government believes [we were] very much involved in
consulting with the industry . . . we consulted with the
legal fraternity and those individuals involved. And
there was a group, they wanted more information to
be filed. A nd, yes, some of that information is avail able in certain areas, particularly in law firms.
But it came down to the requirement of
whether . . . timing. And so, when questions are asked
and information is needed, do we go to law firms and
say, We need cer tain information? So, by coming to
an agreement that this was the minimum that we
thought would meet the requirements that NAMLC . . .
so between NAMLC and our discussions, ROC and
the legal fraternity, we came to these particular points.
There was a lot more information that they
wanted, to be honest with you. But we felt at this time that we would just move with [this] particular information.
No, there will not be any filing fee.
Yes, we have given six months. But I believe,
at the end of the day, if an individual has not met that
six-month [deadline], there will be another grace per iod. But somewhere along the line, they will have to
file. And so, we expect that to take place.
There are always issues or problems that may
come up.
I am trying to remember another question.
Anything else I forgot?

Yes, just for clar ity. Is the Junior Minister indicating that the onus will
be on the legal representatives, the registered offices
of the companies to ensure that they, the companies,
are in compliance within the six-month period of time?
It is just important, because there are some companies that, where their registered offices are effectively
their corporate offices and they may not have the necessary liaison with the legal representation.
Obviously, if you hav e got like a Conyers or
an Appleby or whomever, who oversee their corporate structure for the companies that are registered, they
would be able to say to them, We need to ensure that
this information is available and filed within the r espective period of t ime. Outside of that, in the absence of that official structure, the onus, obviously, now, unless it is going to be driven by the Registrar of
Companies, the onus would, presumably, be on the companies themselves to know that there is legisl ation that has now been passed that requires them to do something else.
So I am curious to know how we make sure
that we catch everybody in the provision of the neces-sary information; otherwise, if there is, let us say, a random access for a sample and somebody has not
filed, then we fail. And we do not want to fail. So we
want to make sure that we include, as much as poss ible and as far as possible, the ability to make sure
that everybody is in compliance with the legislation.
And that does not happen as a matter of course, working in the corporate environment. So I am curious
to know how companies will know, if they do not have
that corporate structure with an Appleby’s or a legal
firm, to make sure that they are in compliance so that
we do not fail as a jurisdiction. B ecause that is the
critical issue.

Minister.
Hon. Wayne L. Furbert: Mr. Chairman, this is not the
first time that we have ever asked companies to make
changes. And whatever the process that we have
done in the past to ensure that those individuals who have law firms, corporate service providers, et cetera,
et cetera, et cetera, they will be informed and they will be notified that they have to make certain changes to
the ROC.

[Inaudible interjection]

Hon. Wayne L. Furbert: It answers the question.
The Member was trying to figure out whether
we will be able to get the information out there to ensure that they comply within the six months. The ROC
is well equipped to ensure that they get the information out to those particular entities to make sure that they file. And we will make sure that certain PR
work is out there to make sure that it happens.
Will one or two slip through? It is possible. But
at the end of the day , they will do whatever it takes,
and if you have not filed, then they will take the necessary steps to make sure— whether there are calls or
whatever it is —the electronic filing will take place. And
it will be done as soon as possible.

Okay.
And if you would just indulge me just as a
point of information, and I appreciate what you are
saying about the Registrar trying to get information out
to everybody.
The challenge, sometim es, though, is you
have local companies that do not have a proper ad-ministrator for them. And you have to file a Form 13
with the Registrar of Companies to let them know the
location of your registered office. And there are times
when the Form 13 is not updated. So that is the co ncern. So that there can be like a publication in the
Royal Gazette or some kind of notification so that
people actually do not miss it.
So, I think that is the point. It is not that the
Registrar is not going to expend her best ef forts to
make sure that people know. But the fact is that there
are some people who do not keep their documents and records updated. And you do not want those to
slip through the cracks.

Minister.
Hon. Wayne L. Furbert: Thank you, Member. Y our
concerns are noted.

1920 27 April 2018 Official Hansard Report

Bermuda House of Assembly The Chairman: Any further speakers?
There appear to be none.
Minister, do you want to move this Bill to be
approved?

Hon. Wayne L. Furbert: Thank you, Mr. Chairman.
I will move first that the preamble be approved.
[Inaudible i nterjection]
Hon. Wayne L. Furbert: Sorry. I forget that.
I move that clauses 1 through 4 be approved.

Any objections to the preamble being
approved?
There appear to be none; continue.
Hon. Wayne L. Furbert: I move that the Bill be r eported to the House, as printed.

The Chair man: It has been moved that the Bill be
reported to the House, as printed.
Are there any objections to that motion?
There appear to be none. The Bill will be r eported to the House, as printed.
[Motion carried: The Companies Amendment Act
2018 was considered by Committee of the whole
House and passed without amendments.]

House resumed at 12:37 pm

[Hon. Dennis P. Lister, Jr., Speaker, in the Chair]

REPORT OF COMMITTEE

COMPANIES AMENDMENT ACT 2018

Thank you.
As I indicated, we completed the earlier O rder, which was the Companies Amendment Act 2018.
We are now going to mov e on to the second item for
today’s sitting, which is the Companies and Limited
Liability Company (Initial Coin Offering) Amendment
Act 2018. And the Honourable Premier will come to
the floor so he can start the matter for us.

Hon. E. David Burt: Good aft ernoon, Mr. Speaker.

Good afternoon.



Bermuda House of Assembly Hon. E. David Burt: Mr. Speaker, before I begin my
substantive remarks on this particular Bill, I would like
to, of course, acknowledge for the House and for the
listening public the historic agreement that was just
signed earlier today with the c ompany Binance.

[Desk thumping]
Hon. E. David Burt: And while they joined us at the
Cabinet Office earlier, they are here in the Gallery t oday, and I would like to acknowledge Mr. Changpeng
Zhao and Miss He Ying, who are here today, in addition to their team. And I want to thank them for their confidence in Bermuda as we move forward in this
space.
[Desk thumping]

ANNOUNCEMENT BY THE SPEAKER

HOUSE VISITORS

While you are getting yourself together,
I will take the moment to welcome them to our Chambers. Good afternoon to you. Welcome to Bermuda
and to our parliamentary Chambers and I trust that you will find the parliamentary proceedings enlighte ning.

Hon. E. David Burt: Thank you, Mr. Speaker.
It is my intention to also have further such
announcements regarding additional investment to
Bermuda which will fulfil our promise of creating ec onomic growth and also creating jobs. It is my hope that later today I will be able to make those announcement s as well.

BILL

SECOND READING

COMPANIES AND LIMITED LIABILITY COMPANY
(INITIAL COIN OFFERING) AMENDMENT ACT 2018
Hon. E. David Burt: However, Mr. Speaker, to the
task at hand.
I am pleased to present to this Honourable
House the Companies and Limited Liability Company
(Initial Coin Offering) Amendment Act 2018.
This is landmark legislation, Mr. Speaker, and
it will make Bermuda one of the first countries of the world to implement statutory requirements for initial
coin offerings, also referred to as ICOs.
Mr. Speaker, with this Bill this Government
has chosen to be bold and to take a significant step on the world stage. Many countries are trying to figure
out how to achieve the regulation of new financial
products and services without stifling innovation. Mr. Speaker, this is an important step in delivering on this Government’s promise of economic diversification.
We are determined to once again establish Bermuda
as a centre for global leadership and set a standard
that will serve as an example to the rest of the world.
Mr. Speaker, through this Bill we demonstrate to a
growing industry that Bermuda can embrace innov ation and entrepreneurship. Even more importantly, this
will provide us with the opportunity to advance fina ncial inclusion and other opportunities that were not previously available to most people.
Mr. Speaker, the emergence of blockchain
technology has sparked a revolution amongst tec hnologists, business owners, non- traditional financiers,
and everyday people. Or, as the Deputy Speaker
would say, Mr. and Mrs. Smith. This technology has
been a catalyst for the development of virtual curre ncies and other digital assets that are revolutionising
the way in which people interact and conduct bus iness on a daily basis.
In particular, cryptocurrencies, such as
bitcoin, have provided alternative and an alternate means of payment for goods and services, thereby
establishing a new digital exchange system. Meanwhile, ICOs conducted on blockchain technology platforms have provided a new vehicle to raise funding for
businesses. Companies engaging in ICOs have experienced significant growth, increased customers, and
unlimited possibilities for new products and services,
all without the use of traditional and more expensive
third-party financiers. This new and innovative crowd
funding technique can help a business finance the
development of new products and services or [pr ovide] enhancement to existing ones.
Mr. Speaker, ICOs can also be used to co nvey interest in relations with to a physical asset, such
as the right to access or use the asset or even an
ownership right. The resulting digital representation of
any such right conveyed is considered a digital asset. Digital assets can be sold and acquired, traded or
otherwise conveyed via transactions implemented on
a blockchain technology platform.
Mr. Speaker, as the use of blockchain tec hnology becomes more and more prevalent in business
transactions we believe there is a tremendous opportunity to stand at the forefront of the legal reform that would inevit ably follow. Governments around the
world are working to keep pace with new and innov ative financial technology or FinTech products including cryptocurrencies and other digital assets. Bermuda is
in the process of building an ecosystem that is both
well-known and attractive to businesses whose oper ations include the use of blockchain technology. I have
previously stated in this House, we are looking to
bring economic growth to this country. Whether it is a start-up or previously existing business with a long -
standing history and reputation, whether small, medium, or large, our intention is to bring more busines s1922 27 April 2018 Official Hansard Report

Bermuda House of Assembly es, more jobs, better career opportunities, and more
income to Bermudians.
Mr. Speaker, the first step to building this new
ecosystem and achieving positive results is the enactment of legislation governing ICOs. To deter and
otherwise mitigate risk of illegal use of funds or other
illicit activity there must be an appropriate regime
whereby persons conducting ICOs are properly vetted
and subject to c ompliance reporting. The Bill we are
debating today will amend the Companies Act 1981 and the Limited Liability Company Act 2016 to enable entities registered under those Acts to conduct ICOs.
Pursuant to the amendments, an ICO will be
treated as a restri cted business activity that will r equire consent from the Minister of Finance. This ap-proach has been taken to help ensure that competent
regulatory authorities have sufficient access to information about the ICO and the persons who receive or
otherwise control funds raised via this funding met hod. This includes beneficial owners, directors, managers, and officers of any company or LLC conducting an ICO.
Mr. Speaker, an application for consent from
the Minister of Finance will be required to include d etails about the projects to be funded by the ICO pr oceeds, as well as other information to be prescribed in regulations. It is intended that a FinTech Advisory Committee will be appointed to assist with the initial
reviews of consent applications. To provide f lexibility
for the Minister to adjust the circumstances of the i ndividual ICO as needed, the Minister will be statutorily authorised to impose appropriate conditions on the
applicant or ICO.
Mr. Speaker, while there are different categories of digital ass ets offered for sale pursuant to an
ICO, this Bill does not establish different requirements
based on a specific category. Instead, the Bill includes
minimal requirements that would be applicable to all
ICOs regardless of the rights, functionalities, or features of the digital asset offered for sale. To the extent
that the requirements of any other law govern the
rights or features or any digital asset, such law will
continue to apply and be enforceable. For instance, if an ICO includes ownership interests in the issuing
company or LLC, beneficial ownership and/or exchange control requirements may be applicable.
For the purposes of consistency with existing
Bermuda standards for public issuances, a number of
requirements for initial public offerings of shar es have
been adopted for use with ICOs. As such, it is noted that the requirements of the Bill are applicable in rel ation to public issuances only. Offerings that are not
extended to the general public, or that satisfy specific
conditions, are excluded from the scope of this Bill.
The ICO offer document , also known as the
White Paper , must be published and filed with the
Registrar of Companies, except as otherwise provi ded. Information that must be disclosed in the offer
document includes, but is not limit ed to the following: • details regarding the ICO issuer, including
business lines and company officers;
• the target amount of funding to be raised pur-suant to the ICO;
• rights and restrictions in relation to the digital
asset issue;
• the proposed timeline for any project to be completed with ICO funds; and
• information regarding the opening and closing
of the ICO offer period.
Also required for inclusion in the offer doc ument is a general risk statement which outlines the
substantial project risk and any disclaimers of warranties or guarantees that may impact the purchases. In
the event that information in the offer document be-comes inaccurate in any material respect, the doc ument must be updated as soon as reasonably pract ical. Penalties are included for public ation of untrue
statements or misstatements that are not corrected.
Mr. Speaker, we all know that one of the most
important issues for Bermuda is compliance with standards set by global organisations, such as the Financial Action Task Force and the Organis ation for
Economic Cooperation and Development. According-ly, we must ensure that appropriate transparency and
risk mitigation measures are applicable to ICOs in r elation to both the issuer and purchasers.
In addition to restricting ICOs for use by companies or LLCs, collection, verification, and retention
of purchaser identity information will be required. The Minister of Finance will be authorised to require e nhanced customer due diligence as needed based on
consideration of Bermuda’s anti -money launderin g
and anti -terrorist financing regime and the perceived
risk of the individual ICO. The Registrar of Companies will be authorised to monitor compliance and enforce
requirements related to ICOs via the Registrar of Companies (Compliance Measures) Act 2017. This
includes the imposition of civil penalties for failure to
comply.
Mr. Speaker, we recognise that we are entering uncharted waters. However, we are doing so with
the full knowledge that businesses all over the world
are looking to conduct their operati ons in a safe and
well-regulated environment. Bermuda is poised to
provide a legal and regulatory infrastructure that will attract FinTech- related entities resulting in new employment and career and training opportunities for
Bermudians. We are poised for overall economic
growth and we intend to deliver that to the people of
this country.
Mr. Speaker, in closing, I would like to thank
the members of the Legal and Regulatory Working
Group that was established in November to advance
the Government’s FinTech initiative, the Bermuda
Monetary Authority, and our external partners for the
time and effort that they have dedicated to the FinTech initiative.



Bermuda House of Assembly [Desk thumping]

Hon. E. David Burt: I would also like to thank the i nternal government team within the Busi ness Development Unit, the Ministry of Finance, and the Attorney
General’s Chambers for every meeting, every presentation, every draft document, every late night, every
answer to the emails to make the aggressive timeline
of this Government [and] to bring this Bill to fruition.

[Desk thumping]

Hon. E. David Burt: Finally (and I see he has depar ted the Chamber, which is very unfortunate), I would
like to thank the Minister of National Security, or as I call, in many instances, “the Minister of Blockchain” —

[Laughter]

Hon. E. David Burt: —the Honourable Wayne
Caines —

Yes! Yes!

[Desk thumping]

Hon. E. David Burt: —for his unwavering support and
leadership on this initiative. There is much more to be
done, but we will continue to push forward with this
initiative because we believe in the vision of what we
can do for the people of this country.
Mr. Speaker, before I close, I welcomed in our
Gallery earlier today, when I began my speech, the
founders of Binance. But we are also joined by Dr.
Patrick Byrne, who is also here in the Gallery and who
is the CEO of Overstock.com, but who was one of the
first large companies to accept payments in digital
assets and also is (I would say) the chairman and/or
owner of . . . I am going to get it right—Medici Ve ntures. Medici Ventures will be looking to sign a Mem orandum of Understanding later today with the Government of Bermuda to create yet more jobs and more
investment into Bermuda.
[Desk thumping]
Hon. E. David Burt: Mr. Speaker, this Gov ernment is
committed to moving us forward in this space. We will
continue to work in consultation with the Opposition
and our business partners in making sure that Berm uda is a well -regulated jurisdiction in which to do bus iness and to actually, Mr. Speaker, through the new world that this technology brings, build that better and
fairer Bermuda that we promised to all of our citizens.
Thank you, Mr. Speaker.
[Desk thumping]

Thank you, Mr. Premier. Does any other Member wish to speak?
I recognise the Honourable Leader of the O pposition. Honourable Member, you have the floor.

Hon. Jeanne J. Atherden: Mr. Speaker, I think I want
to say right from the get -go that we understand, as the
Premier and Finance Minister has indicated, that the Government has said right from the get -go that it
wanted to, if you will, add another pillar to Bermuda’s
revenues and another industry. And so we understood
that the ICO was going to be something that [Go vernment] was going to add. And we also recognised,
as the Finance Minister said, that it was going to be
important that if the Government was going to generate sufficient revenues to make it viable, that we had
to get out in front of lots of other jurisdictions that are
trying to actually get into this aren a. So from that perspective we have gone at it from the point of view of
saying, Let’s look at how this impacts Bermuda, and
let’s look at how we can be supportive of the concept.
But understand that there are concerns that one must
have.
So when the Premi er talks about being bold
and taking this significant step, and when the Premier
talks about growing an industry that will embrace
Bermuda’s innovativeness and entrepreneurship, we
appreciate that. And we know that that is what Ber-mudian’s have always been known for. But there is
also the recognition that in order to do this there are
two elements that one has to worry about. One is
what I call the framework, and the other part is the
implementation. So right now we are dealing with the framework and we hav e been looking at what has
been proposed, because we totally understand that we are going to have the CFATF review, and it is going to be very important that we can demonstrate that
we have things in place to show that anybody that
enters into this arena i s going to be protected.
We understand that there is risk involved. We
also understand that it is important for us to show that whatever we have in place is going to be not only developed, but is going to also create that type of regul atory environment.
And with respect to what the Premier said, we
know, and it has been indicated here, that there are
other opportunities for bitcoin, but the Premier has
indicated, and we understand that for right now we are
just dealing with it as it relates to—
Hon. Wayne Caines: Point of order.

We will take your point of order, Mini ster.

POINT OF ORDER
[Misleading]
Hon. Wayne Caines: There has been absolutely no
mention of bitcoin. The Member is misleading the
1924 27 April 2018 Official Hansard Report

Bermuda House of Assembly House. There has been absolutely no mention of
bitcoin.

[Crosstalk]
Hon. Wayne Caines: Bitcoin is a type of currency as
opposed to a modality or a form of block. He just did not mention bitcoin in his Statement.
Hon. Jeanne J. Atherden: Mr. Speaker, if you go to
page 2 of the Minister’s Statement —

Uh-huh.

Hon. Jeanne J. Atherden: —I am reading, “In particular, cryptocurrencies, such as bitcoin, have provi ded alternative and an alternate means of payment for
goods and services thereby establishing a new [age]
digital [bartering] system.” Okay?

[Desk thumping]

Hon. Jeanne J. Atherden: So all I am just mentioning
is the fact that we do understand that there are different ways in which bitcoin can be used, but if the
Member had allowed me to continue, I was just saying
that we know that for right now all we are dealing with
is the initial coin offering and all we are going to be
dealing with is . . . as it relates to utilising it as it r elates to a digital asset. Okay? So—

I would advise you to continue on only
on the fact that once a subject has been introduced, it
is on the table. And it was introduced by the Premier
in his Statement, whether he was saying it as a sliding
glance, it was introduced. So it is on the table.
Continue on.

Hon. Jeanne J. Atherden: Thank you, Mr. Speaker.
And the only reason I am just mentioning this
is because I know, and it has been mentioned in other
places, that there are different possibilities for not only
ICOs but different possibilities for bitcoin, and we are only dealing with this par ticular one. And, sorry, I
should say blockchain. That is the word I wanted to use. We are talking about blockchain, and that we are only going to be dealing with the blockchain as it r elates to right now; this side of it . . . not the whole concept of how blockchain can be used. —

[Inaudible interjection]

Go ahead. Hon. Jeanne J. Atherden: So what I want to say is
the fact that if we talk about . . . the Premier was tal king about the first step of building this new ecosystem
and providing positive results. He indicated that the
enhancement of legislating, of governing ICOs, was very important. And I think that we all understand that.
We all understand that for two reasons. One is because we know that anybody that is out there and is
going to invest . . . there is a degree of risk and r eward. The risk has to be mitigated against and ther efore, as has been indicated, if we have a proper r egime set up for those persons who are going to offer
initial coin offerings, then it is going to be important
that they are properly vetted and subject to compl iance.
We have been looking very closely at what
has been put out in terms of how they will be vetted.
We have been looking very closely at what has been
said with respect to who might or might not get into
initial coin offerings. Therefore, it was good to hear
that for now we are just going to have it limited t o
those persons who, if you will, are knowledgeable so
that it is not (what I call) just a totally open environment. So it is going to be restricted. We recognise that
this means that the persons that get involved have a
greater degree of knowledge. And it reminded me of
years ago when we started to look at IPOs [initial pub-lic offerings] where you started to say that you would have restrictions so that those people that got into it
would not lose their shirt, but would know exactly what
they were getting i nto.
So the fact that this Bill is going to amend
these activities is important, but also the fact that the
authorities are going to be set up, that there will be
competent authorities who will be able to vet this i nformation, is very much important. With what I call the
review which is coming down it is going to be i mportant for us to be able to demonstrate not only for those companies that have already been in existence, but for the new companies that are going to come,
that we will be satisfied that the y are individuals who
have the what I call not only the business acumen, but
have the type of . . . the financial background that
people will feel confident in in saying that they should be registered in our country.
The bottom line of all of this is that we are
hoping that lots of people will register here because
that is the only way we are going to gain the revenue.
We are only going to gain the revenue by lots of people coming here. We know from looking at other juri sdictions that there have been peopl e that have regi stered and things have been lost. People have lost money. And I am not saying that this is what ha ppened because in Bermuda we always try to do things
in the way that says we have a proper regime. We
make sure that, as the Finance Minister has indicated,
Bermuda wants to have this high standard, which is good. We always try to do things in Bermuda that
have a high standard. So knowing that they will be


Bermuda House of Assembly subject to the compliance is going to be very i mportant for us.
Also, with respect to the fact that there is going to be the FinTech Advisory Committee, I think that
this is important and we will, obviously, look forward to see how this FinTech Advisory Committee will be set
up. I think that the question that came up related to
the role that th e Minister played in this process in the
sense that the Minister has indicated that to provide
flexibility, for the Minister to adjust the circumstances
of the ICO as needed, he will be able to impose ap-propriate conditions on the applicant, on the ICO. I
guess it just raises the question, and I guess we will
have to see at the point in time when this legislation is
approved and how it comes into play, what type of regime will be in place to have checks and balances
on the Minister. Because whether you like it or not,
there is an element that you want to make sure that there is a process that the Minister would be able to
make appropriate changes. But you also want to
make sure that it is set up in such a way that individ uals will feel that the way it is set up . . . that anybody
that looks at it from a regulatory perspective will feel that there is a review, there is a recommendation, and
someone has the ultimate decision- making, but the
decision -making has some checks and balances.
With respect to the Mini ster’s indication that
there were two reasons for going along this path, as I
say, one was the generation of revenue, but also the
second [reason] was the jobs that were being created.
So I guess this is where we have to look at, and the
people of Bermuda will have to be very much interes ted in how the jobs will actually come to Bermuda and
to Bermudians, because we understand and we know
that an initial coin offering is one thing. But the second
[consideration] is where will they be physically . . . sorry, you do not have to be physically located here. But
you can have your offerings around the world because
that is the virtuality of it. But there has got to be a way
that . . . we have been talking about jobs.
Now, I think, and maybe the Minister will say
later on, that some of the jobs that will come will be in
the second part of what has been talked about, which is what I call the blockchain. But it has been mentioned, and because it has been mentioned, it will be
useful to know whether the Minister believes that there are going to be some jobs that will come as a
consequence of this part of it, or whether the belief is
that the jobs will come later on when the blockchain
industry progresses in Bermuda.
Mr. Speaker, I must say this very carefully
because sometimes I might not be clear enough. We
are talking about jobs which were supposed to be
generated by this particular new industry. I am not
talking about general jobs; I am talking about jobs
which are going to come from this particular industry.

[Inau dible interjections]

Ah! Ah! Ah! Ah! Minister.

Hon. Jeanne J. Atherden: So we will be looking to
see how many jobs that the Minister thinks will come
as associated with this new ICO offering.
We will also be intrigued to see how the rev enues are going to be generated. Now, I have looked at
the legislation and I know that some of it is related to fees that will be generated. But I also understand that
some of it might be related to activities that will come
as a consequence. But for the ordinary Bermudian, recognising that we have heard, you know, [about]
millions and millions of dollars, it will be interesting if
the Finance Minister would be able to tell us into
which part of the process the Government believes
that it will collect its rev enues, whether it be the collection by the fee route or via the business activities of
the particular promoters that take advantage of the
ICOs.
With respect to the risk . . . and I think an ybody that has read it will be heartened by the fact that
the Fi nance Minister talked about the White Paper ,
and he talked about the information that will be filed
with the Registrar of Companies. I think that is all very
good information that anybody that might ultimately
invest in an ICO will be happy to know that th ere will
be information with respect to their business lines, the funding, the restrictions on the assets and also the timeline for the projects to be completed because then
you know effectively, when you are getting into it,
what you are going to get back and the time and when
you might get it. So those are all very good things that
I believe that when a regulator comes and looks at us,
and I mean the outside regulator, comes and looks at
Bermuda that they will feel that we put in things that
will make us be a step above other jurisdictions.
And I say a step above other jurisdictions because we all know, Bermuda has to know, that other
jurisdictions are racing to try and set ICOs up and set up the possibilities. And, as I say, the risk/reward
where we know the timing, and I always say that ti ming is everything. We know that the CFATF people are
coming to visit us and will be looking at this. So it is
going to be very important for us to be able to demonstrate that what we have as it relates to this fram ework is properly regulated.
There was an indication in here that not only
was there going to be this general risk statement, but as things change that information will be updated. I
think these are all very good things with respect to
showing that Bermuda’s Government is trying to make
sure that we are protecting the investor. Because the
bottom line is people are going to invest in this, as it is
an investment. Whether it is a virtual asset, et cetera,
it is still an investment.
Therefore, with respect to . . . I think there
was an indication of . . . I think I mentioned earlier
about the FinTech- related industries, and that is why I
asked the question about how many jobs, et cetera,
1926 27 April 2018 Official Hansard Report

Bermuda House of Assembly that the Government was thinking that it might actually
get.
I think, Mr. Speaker, that the only two other
observations that I wanted to make with respect to the
legislation is the fact that we know that once this legi slation comes that there are some other pieces of legi slation. We welcome the Government making us aware
of what they are trying to do. We welcome the opportunity to be able to be able to discuss some of this. I
know that there are one or two things that we are going to discuss in the actual legislation, and I know that one or two of my colleagues are going to speak about
the whole concept of ICOs. I am just reminding ever ybody that this has been discussed for a while. And I know one of my other colleagues in the past when we were the Government actually, you know, we talked
about FinTech. And I am not going to say w ho brought
it up first, et cetera, because it is never —

[Inaudible interjections]

You are.
[Inaudible interjections]

Hon. Jeanne J. Atherden: What I am trying to say is
that when Bermuda gets into new industries, and if we
are going to make this the third pillar as the Gover nment wants, we still have to make sure of all the other things that are important to a country when you establish a third pillar, which are:
1) Is it going to be sufficiently robust that it wi ll
actually be a third pillar?
2) What is it going to mean to the country as it
relates to getting jobs?
3) What type of risk is the country going to
take and [what is] the reward that is going to happen?
So I am saying that we have to look at that in
those terms. And it is never a question about who
starts; it is always the question of, when you put it in
place, making sure that it is properly put in place so that Bermuda’s reputational risk . . . reputation is always as high as it has ever been. Becaus e I think that
in anything that we do I am sure that the Government,
in the same way like when we were the Government, wanted to make sure that Bermuda’s reputation is always going to be protected. And, Mr. Speaker, I will —
[Inaudible interjections]

Hon. Jeanne J. Atherden: —make sure that —
[Inaudible interjections]

No, you still have the floor. You are all
right. Go ahead.
Hon. Jeanne J. Atherden: So I just wanted to say
that I know that there are a couple of questions that
we are going to have during the actual Bill itself. But as I say, we know why it is here. And we know why
we have rushed back to do this. And we know that we
are under this tight schedule. But I believe that there are reasons, there are opportunities, and we look forward to being able to ask the questions to make sure that it can work for the country. Thank you, Mr.
Speaker.

The S peaker: Thank you, Madam.
Does any other Member wish to speak? I recognise the Minister. Minister Caines, you have the
floor.

Hon. Wayne Caines: If it pleases you, Mr. Speaker.

Yes, go ahead. Continue on.
Hon. Wayne Caines: Sometimes you are in a pos ition, Mr. Speaker, where you can be a part of som ething great, where you can watch it from its genesis,
where you can understand the impact that it will have,
that you can look in a community and see that it is bereft of opportunity. You can l ook at a people that
have been neglected, who have not been given opportunity, and it creates an opportunity for innovation.
It creates an opportunity for opportunity, and it creates
an opportunity for people to think outside the box.
Bermuda, for a very long period of time, has
had oligarchies that have been put in place, that have kept many people in this country marginalised and on
the sidelines. There is now a form of technology called
blockchain technology that by its very nature is disruptive. The very essence of this blockchain technology is
that it allows an irrefutable way to look at data, to look at finances, that cannot be adjusted.
So if you are looking at the blockchain tec hnology from a financial standpoint, that is only one perspective. You can put the land title on there. I have
seen in Africa where they are using the blockchain to manage supply chains. To give people who do not have the opportunity to be banked, the opportunity to
have financial means of supporting their family.


Bermuda House of Assembly So the ver y genesis of this country looking to
get into this disruptive form of technology, this disruptive methodology of banking, is because we believe,
first and foremost, it can change the world. Like Chri stopher Columbus who went to Ferdinand and Isabella—and everyone at that time believed the world was
flat . . . he had to go to Ferdinand and Isabella to seek
recompense or finance to go to the New World.
We find ourselves, Mr. Speaker, in a similar
position. There are people all around the world that
understand that no matter how hard the institutions
try, no matter how [hard] banking institutions try, or
political systems try, they cannot stop this modality of
finance, of blockchain, how this “new world” is moving.
So after considering where this world is going, how the world is changing, Bermuda has made a decision
to lead.

We needed a little humour that time,
but continue on. We got our humour. You can conti nue no w.
Hon. Wayne Caines: Mr. Speaker, I am almost 50
years old. You know what happens when you start raising in age.
[Laughter]
Hon. Wayne Caines: Mr. Speaker, the opportunity
has come for Bermuda to punch above its weight, and we always have. My mind goes back to the 17
th century when they were looking for a new method of sailing
in this world. We made our living on the water. And
there was opportunity for us to develop a boat and it
was the Bermuda sloop. We developed something called the “Bermuda rig.” The cut of the jib of the boat
and the hull of the boat was more narrow, it was more sleek. It allowed us to navigate through these waters avoiding the reefs. We have always been a centre of
innovation. And what did we do with this technology?
We gave it to the world. And boats and sailboats the world over still use what? The Bermuda sloop. And
awe the Bermuda rig.

Stay focused, yes.

Hon. Wayne Caines: We then had the opportunity in
the middle of the 18
th century when things were not as
opportunistic on the water, as it were, we started to go
into the agrarian elements in our country and we went
to tobacco, lilies.
Mr. Speaker, I was recently in London, and
Her Majesty Queen Elizabeth II, in the receiving line,
thanked me for the lilies that she received from Bermuda last week.

[Inaudible interjections]

You assured her that you picked them
for her, right?
Hon. Wayne Caines: Mr. Speaker, I am not one to tell
lies.
[Laughter]

Hon. Wayne Caines: Mr. Speaker, and the onion. So
we have always had to be innovative to survive. And
so from our sailing past of the Bermuda rig, we went
directly into our agrarian past, lilies, onions and tobacco.
We then went into the next age where we
went into the iconic Bermuda shorts, Mr. Speaker, and we went into tourism. And people started flocking from
all over the world to sail and swim in our turquoise
blue waters and to frolic in our pink sand. Not just for
fun, but this was a way that we were innovative. This
was a way that we changed the world.
1928 27 April 2018 Official Hansard Report

Bermuda House of Assembly The Speaker: Mm-hmm.

Hon. Wayne Caines: In the 1960s we realised that in
order to survive we must continue to evolve and to be
innovative and we did that with the advent of our cap-tive and our reinsurance market with the financial services.
So this innovation that we see in 2018 is consistent
with this Island’s history of innovation. When we consider where we are going in this new world, there are
a few things that we must consider. We must consider
the reputation of this country. What does that mean?
People come to Bermuda because we are very well
regulated. It is not the wild, Wild West when they are
here. We have TIEAs. We have strong relationships with international and corresponding banks all around
the world. Reinsurance companies, hedge funds, they
all set up and domicile in Bermuda because of the
reputation that we have.
Make no mistake about it. The reason that the
world is starting to become so energised about being
in Bermuda is not just because of this blockchain. They are excited because we do things at a very high
standard. You can talk about Malta, you can talk
about Gibraltar, but I can tell you that they cannot li ght
a candle to the regulation of [our] beloved Islands. So
it is understanding the nature of the sanctity, the sac-rosanct nature of our pillars, that we have made the
decision to go into this business.
Every decision that we have made has been
carefully c onsidered based on our reputation, understanding that when people come to Bermuda they
think about our arbitration clauses, that they domicile and do the arbitration in Bermuda; that when they
have legal matters that it goes from our summary
courts through to our high courts and then to the highest court in this land, which is the Privy Council. We
accept and we understand that. We are not foolhardy.
We understand that the primary function of this endeavour is to make sure that it is well regulated. To
that end, we have hired the benefit of an international
regulator.
We have considered this in our working
groups, Mr. Speaker. We have had two working groups: the Legal and Regulatory Working Group and
the Business Development Working Group. The Legal and Regu latory Working Group, Mr. Speaker, consi dered all things legal. They were made up of members
of the private sector, the public sector, the blockchain
industry, and the technology industry. And what they
did from the very genesis of this endeavour, they
whiteboarded, they talked, they discussed local law,
international law, FTAF [ Financial Action Task Force]
assessment, NAMLC [ National Anti -Money Laundering Committee] —all of our assessments. We realise
that we have an assessment coming up, Mr. Speaker. We kn ow how critical it is to our infrastructure.
In 1994, Mr. Speaker, Her Majesty Queen
Elizabeth II came to Bermuda for a visit. They were building a road, and she was to use the South Shore
in Bermuda. And we made a decision to renovate and
pave the roads o n the South Shore. The good news is
that the roads were paved and the yellow line was in, but the road was finished about three weeks before the Queen came. So the people in Works and Eng ineering at the time said, Well listen, we cannot let a nybody use thi s road. After all, Her Majesty is coming.

[Laughter]

Hon. Wayne Caines: They cried out, We must block
the road off on each side because we want her to
drive on a pristine road.
Oh my goodness! The world would fall if an ybody used that road!
The Minister with responsibility for Works and
Engineering said, But after all, this is a road. Your r esponsibility is to make sure that it is well lit, that the yellow line separates the significant parts, that you put
the requisite police officers at the locations; that
somebody monitors traffic, that the people that are responsible make sure that the road is and stays in pristine condition; that if somebody is using the road
and it gets nicked, that they have the wherewithal to
go back in and correct that.
Why wou ld we, a country that is innovative,
which understands finances and have made our bread and butter, be scared of a FATF assessment? We
have to do things right. The world is moving at light
speed. We have a $2.4 billion debt. Will that pay i tself? We must be innovative. We must be hard wor king. We must keep in the forefront of our mind what
we must do—that is to be regulated, that is to have
the proper regulation, and that is to protect the infr astructure of this country, and that is what we have
done.
The legislation is fulsome. It is logistically . . .
it is legally sound, and it has kept every element in mind of what is most important to this country, and
that is our assessments. We have had NAMLC on
these committees talking with us. We have had the
guidance. The legislation, Mr. Speaker, has to be
sound. And the things that we must focus on are
what? AML, the anti -money laundering piece; and the
KYC, know your customer piece; and the American’s
ATF, anti -terrorist financing piece.
So if you look at the legislation precept upon
precept and withdraw the hype, withdraw the innuen-do, withdraw the scaremongering, you can see that
the legislation has considered the key elements. As a matter of fact, this industry wants to be regulated.
They want to have the guidelines. They want to make
sure the cowboys and the nefarious actors are not in
this space. And so what Bermuda has decided to do is
put something in place called the “Bermuda standard.”
What is the Bermuda standard? The Bermuda stand-ard is that you make sure that every element of this —
you have your KYC (know your customer), your


Bermuda House of Assembly AML—and when you look at the white paper phase,
the white paper phase articulates at every single step
what you will need. Let’s go through the phases.
Now, when people start talking about e xchanges and coins and tokens, that is not included in
this legislation. Mr. Speaker, this is the first in a series
of pieces of legislation that will be put in place. So
when we are talking about the direction that we are
going in, the first phas e is the laying of ICO legislation.
For my mother, I told her I was going away to a co nference and we were going to be discussing, amongst other things, bitcoin. When I came back, she said,
Wayne, how was the Fitbit conference?

[Laughter]

Hon. Wayne Ca ines: How was the Fitbit conference?
And, Mr. Speaker, there are two types of people in the world. People that get it and then the Fitbit
people. Right?
[Laughter]

All right.

Hon. Wayne Caines: And so the reality around it is,
Mr. Speaker, that the elements are in place to protect
the country. We have focused on the AML, the KYC pieces, and we want to have our feet held to the fire.
Let’s just talk about the collaborative nature of
this process. Oftentimes people are in spaces and
they are arrogant enough to believe that they know it
all. Well, that was not the case in these circumstances. At every stage it was collaborative. We relied on
people from a myriad of different spaces. We consul ted with the business community. We had a session
down at the Bermuda Underwater Exploration Institute
[BUEI], and over 150 members of business came and we discussed it. We shared the plan with them.
We have been on a roadshow to local law
firms. This past Monday we went to Appleby and we met with the partners and some of the people in this
space at the firm and we had discussions. We met
with the trust group and Leila Medeiros and Rod A ttride-Sterling fr om the trust organisation and we
shared with them all of the plans.

Leila Medeiros is not in the trust
industry. I believe she is in insurance and reinsurance.
[Crosstalk]

Hon. Wayne Caines: Mr. Speaker, she did not appear in behalf of that. I will get clarification from one of my colleagues and I will come back at a later minute
just to be sure. But I thank my learned friend, the
learned Member for her guidance.
Mr. Speaker, we met with ECAB. ECAB is
from the Ministry of E -Commerce. That is the board
that deals with how that particular Ministry runs. We
met with the Opposition. We had a conversation ye sterday where we shared the FinTech strategy with the
Members of the Opposition. I will say, from the outset
it was a pleasure to be in that environment with my colleagues. I believe that we had the basis of fruitful
and meaningful discussions around this legislation
and I, for one, whenever I am doing something, follow
the prescribed manner in which I did on that occasion.
Mr. Speaker, we believe that we have collab orated with people outside of Bermuda. Next week there will be some public announcements w ith reference to the consulting bodies and what they will look
like. Mr. Speaker, we have talked about the questions
that have been asked around jobs. Today we saw a press conference and Binance, one of the biggest crypto exchanges or companies on the planet —on the
planet! —has said that they want to come to Bermuda.
They did not say that they are going to bring a “chip shop” to Bermuda. They said that they are going to bring their compliance department to Bermuda, which
means if you need a job in the legal frame, or understanding how to put these companies together and do what we need, i.e., AML, KYC, ATF, well, Bermuda
will be the centre of the universe for global compl iance. So if anybody is wondering, How will Bermuda
fare? Well, we have not even announced the legisl ation and the biggest company on the planet has set up
in Bermuda!

[Desk thumping]
Hon. Wayne Caines: They believe so strongly in
what we are doing, they are saying that they want to
centre the operations for regulation in Bermuda.
The Prem ier is now meeting with one of the
most preeminent businessmen in this field. And hop efully we can give you another . . . Where are the jobs
coming from? We believe that when you are setting
up an ICO you have to use companies to set up. Those are lawyers, those are secretaries, those are
compliance officers. These companies need cybers ecurity professionals. They need CTOs, chief technical officers. They need people for a myriad of positions.
But what did we hear today? We heard that Binance will spend $10 million for educating Bermudians in the
technology space.
1930 27 April 2018 Official Hansard Report

Bermuda House of Assembly [Desk thumping]

Hon. Wayne Caines: You can say what you want.
But let me tell you what this country needs. We do not
need another industry that is only taking money out of Bermuda where [other] pe ople are benefiting. Already
with the first person that has reared their hand and
declared it, w hat do we see? We see 40 jobs and $10
million. Now, my daughter is out to study international
relations. I am going to have a call with her tonight
and say, Listen. You might have to switch to tel ecommunications, because we have somebody here
that has got $10 million available.
Mr. Speaker, when we look at the revenues,
well, it is clear where the revenues will come from. I do not want to tell tales out of school. But everybody
knows how this works. We know how the telecomm unications industry worked for a number of years. Didn’t we take a portion of the revenue from the tel ecommunication company and was that not a remi ttance to the government coffers? Well, with out telling
tales out of school, we believe that there will be oppor-tunities, and legitimate opportunities for this Gover nment to significantly collect money and to reduce the
debt to increase the Consolidated Fund. I believe that
when the time is appropri ate, we should be able to
articulate this line by line because there will be a flight
of fancy that a person wanted details on that today.
We are doing this systematically, Mr. Speaker. The first element is the ICO part. Raising . . . how
do people come . . . what is the ICO part (for my mom
who is listening)? Momma, it is a very basic concept.

[Laughter]

Hon. Wayne Caines: Yes, this is where people might
want to have an idea and they want to have a plan,
but they do not have enough money to do it. What we
are telling them is that they can come through their
ICO, mom, and they can raise a bucket load of money
in Bermuda through a prescribed method and that is
how they will be able to make money and go ahead
and do the endeavour. So the ICO, mom, is simply a way . . . Mr. Speaker . . . I’m sorry. Mr. Speaker —

[Laughter]

Go ahead.

Hon. Wayne Caines: Mr. Speaker , the ICO part is
simply . . . because people get lost in the nomencl ature. The ICO part is simply a way where you can
raise money to finance the project that you are on. And we are simply saying, Guess what? If you want to
raise that money, come to Bermuda! Welcome to
Bermuda!
Why would you come here?
You come here because we are friendly, because the country is beautiful, because we have a 60year history of being very well regulated. And this i ndustry is going to be very well regulated. Oh, Mr. Bad
Man, Oh, Mr. Nefarious Man, guess what? You are not welcome in Bermuda. And how are we going to
keep you out? Well, let’s look at the AML (anti -money
laundering) and the KYC (know your customer). We are going to put hurdles in place that if you are a bad
actor, why would you want to give all that information?
Why would you want to make all that ready? We will
put the mechanisms in place throughout this process
where the country is protected.

[Crosstalk]

Hon. Wayne Caines: Mr. Speaker —

You have not used up your half an hour
yet. You have got about another 10 minutes, or . . .
Hon. Wayne Caines: Thank you, Mr. Speaker.
Mr. Speaker, the object of this entire endeavour is to create an ecosystem. The ecosystem will
start when a person has a conceptual idea. The first
phase of it is the incubator phase where a person has
an idea or they have been given permission to set up
in Bermuda, and you want to set up a company, or
you want to do an ICO, or you want start a business.
Well, we want to have the opportunity for a person to
have an incubator in Bermuda. We are going to d evelop incubators where a business can come to Bermuda, whether that is FinTech (financial technology),
RegTech (regulation technology), ReisuranceTech
(reinsurance technology), where all these industries
could thrive and where they can grow in Bermuda.
We believe that is where the opportunity is. It
is creating an environment where new opportunities in Bermuda come to a country where the regulation is in
place, where the opportunity is in place, the likeminded people are in place, and they want to set up
their companies in Bermuda. And if they are indeed
successful through the ICO offering, through the inc ubative phas e, well, it is our hope, Mr. Speaker, that
they stay in Bermuda, that they keep their company in
Bermuda, that they launch in Bermuda.
The third pillar? If we are able to keep the educational phase with this, and keep our people getting
educated and hold t heir feet to the fire with educational results, well, we can see that this is an opportunity
not only to change this country, but to set a model for


Bermuda House of Assembly the Caribbean— Nay! For the world! —on how we can
change the life of its citizens.
Up until this morning when we signed the
MOU (Memorandum of Understanding) the pundits
would have said this was aspirational. With the sign-ing of that MOU, that is valued at $50 million, we can
see that, Mr. Speaker, it is not aspirational, that it is
indeed taking place.
The Spe aker: Mm-hmm.
Hon. Wayne Caines: The next phase, Mr. Speaker, is
the Virtual Currency Business Act. The Virtual Cur-rency Business Act coming directly after this, around
the second week in May, is the Act that will govern exchanges, tokens, how they operat e. Mr. Speaker,
this is being developed and led by the BMA [Bermuda Monetary Authority] because people ask all the time,
Where is the BMA in this? Do you have the support of
the regulator in this? Have you consulted the people
that are affected? Mr. Speaker, the answer is we have
consulted with the BMA. We have been working in
lock step. Sometimes we have been in this process
and it has been uncomfortable. The regulator does not
have friends, it does not seek favour, they are ind ependent. So, at times they have had to pull the reins
in tightly. But what is clear is that at every stage we
have worked together to get the piece of legislation
that you see today.
Should it have been a stand- alone piece of
legislation? Well, that is a matter for some. But what
we can tell you, Mr. Speaker, . . . Why did you do it
now? Some might ask, Why did you not wait until after
our assessments? Because the companies were se tting up in Bermuda. They were coming to Bermuda
and establishing ICOs. We could not stop them. So rather than as in the wild, Wild West, where ever ybody was coming to Bermuda and setting up ICOs
without it being regulated, without there being any
guidelines, this country knew that it would be unpopular in certain quarters, we knew that people would
have c hallenges, but we knew that it had to be done.
So, in the midst of all of the wahallah we decided to
go ahead and put the regulations in place by writing
this Act. And we had to get it done quickly to protect
our global reputation, to protect us from these coming
assessments. Mr. Speaker, we believe that it has
worked.
Mr. Speaker, you may or may not know, but
last week I went to Great Britain. We went to a law
firm called Mishcon De Reya . At this law firm they set
up meetings for companies that were inter ested in
setting up ICOs. There were over 20 companies in the
room, Mr. Speaker. At the end of the evening, we had
to set up another two days of meetings because so
many companies wanted to come to Bermuda to learn about our ICO process to see the draft regulations.
Would you believe, Mr. Speaker, that the Vi rtual Currency Business Act is on the BMA website where anybody can go? They can put their thoughts,
they can disagree; they can say why they do not like
it. This is unprecedented! But this Government has
stated that we know that we will not get certain things
right. And when I said “unprecedented” I saw som eone’s brow being furrowed. By “unprecedented” I
mean that we realise that this is so significant to our
country’s future that we cannot be selfish, we cannot
be partisan, that this is about Bermuda Inc. So I accept and will give Jack his jacket.
The Bermuda Business Development Agency
did go on a roadshow for about 15 months. They talked to people in California, in New York, about
these spaces. And I get that. They have worked exceedingly hard and we will continue to work with them.
So, work has been done, as our Premier has said,
and the team that you see in front of you (and some not in front of you, Mr. Speaker) has done yeoman
service to make sure that this Bill has come to fruition.
I believe that when this legislation is passed this cou ntry will sit back and see the jobs come in. And they will
realise that they have done something right. It is not a magic pill. It will not automatically bring the cure for
cancer, alleviate hunger; it will not get everyone in
Bermuda a job. But it is a step in the right direction.

Yes.
Hon. Wayne Caines: The blockchain technology, Mr.
Speaker, is revolutionary. You can say what you want about i t having a lack of discipline. And in some areas,
yes, it does. But guess what the Bermuda standard
will do, Mr. Speaker. The Bermuda standard will reg ulate. It will put the proper mechanisms in place where people can be held accountable.
This Government has been brave. We have
kept our heads. We have stayed the course. We invi ted companies to come to Bermuda and they are here. And we would like the opportunity to live up to our campaign promises to give the people of Bermuda
something that they can believ e in, tangible opportunities.
Mr. Speaker, thank you, sir.

[Desk thumping]

Thank you, Mr. Speaker.
Mr. Speaker, let me first of all start by saying
that we actually had a productive session yesterday.
And I thank the Honourable Member, Minister Caines,
for hosting a number of us with technical officers. It was about 90 minutes, and I think it was helpful in
1932 27 April 2018 Official Hansard Report

Bermuda House of Assembly terms of trying to get a better understanding of how
Government is proceeding in this particular space.
I am going to preface my remarks by quoting
Stuart Lacey, who I think many Honourable Members
will know of. If there is anybody, I think, in Bermuda who has demonstrated their ability as a FinTech entrepreneur it is Stuart Lacey with Trunomi. He has
won a number of international awards for the company he has set up, and I think he has done a really
good job of putting a Bermuda company at the for efront of I guess what you would call RegTech basically, as sort of a subset of FinTech.
I think he made some very useful comments
in the Gazette. It wasn’t very long ago, it was on
April 18
th. He said that on Bermuda’s Government’s
FinTech initiative he said he felt it was going to be,
and I quote, “ positive for the island” and “an opportunity for [Bermuda] to be able to participate seriously in
this space.”
What I found more interesting was that he, Mr.
Stuart Lac ey, went on to say, “ There is a sense out
there that there is a bit of a race to be the first jurisdi ction to get it done. ” He said, “I think it’s not about getting it done first, it’s just about getting it [done] right
. . . .” I think that is a very usef ul message for us today
and certainly for Government as well. In fact, Stuart Lacey was there yesterday, and I know that he has been sort of adding his contribution to the efforts that
the technical officers and Government have started in
this area. But I think it really is important that this is
not just a question of being first to market. It is a question of getting it done right.
We had quite a bit of discussion about
FinTech in this House. I think, certainly, the Premier is an advocate. And I do not think there is anybody who
is more of a salesman than the Honourable Member
who just took his seat. I think we have said in Throne
Speech debates and certainly in the Budget debate
last year that we believe it is important for Bermuda to be in this space f or the simple reason that it is all
around us. I do not want to disagree right off the bat
with the Minister, but I think it would be fair to say that
a lot of very large banking institutions and insurance institutions have been working in this for a number of
years now. Some of them are here. There is a huge
banking syndicate which has been looking at bloc kchain, so it is not as though this is sort of a new field
in many respects. In fact, FinTech goes back probably
as far as PayPal; maybe before that as w ell.
So, it is a question of how it is done in getting
it right. And, Mr. Speaker, I think it is important to r emind people that one of the responsibilities of the O pposition is constructive criticism. And I think you are
going to be hearing a certain amount of that today.
We would not be doing our job if we did not have, shall we say, a perspective on it, and if we did not,
where we felt it was important, make constructive crit icism. And in many respects I think you will be hearing
some of that today, an expression of it’s not all roses and sunshine. There are some concerns here and
there are some issues that I think we have to face
head on with eyes wide open.
I think both the Minister who just took his seat,
and the Premier, commented that this is, in m any r espects, a challenging area. It is new in some regard,
but it is clear that a lot of other governments and regulators are trying to grapple with the best way to facil itate this sector but, at the same time, contain the risks
both to investors and to f inancial markets. I think this
should be part of our job as well. Given that, I believe that the Government really should have set out and
looked at what I will call an impact assessment here.
And if you want to know what I mean by an impact
assessment, I think a good example in a very different
space is what we require of large infrastructure pr ojects here. We do an environmental impact asses sment to understand both what the benefits are but also what the risks are and what things need to be
mitigated.
Now, I am sure we will hear from the Government side that they have thought all about that and
it is all done, and not to worry our pretty little heads
about it. But in this case I think an economic impact
assessment would have been very useful. I think the
horse is a little bit out of the barn door at this point.
But something which sets out about the risks to Bermuda and Government’s view on the benefits with respect to the economic contributions, jobs, business
opportunities, and business opportunities and jobs for
Bermudians in particular. I think this is really important
here because in some respects this sector is tec hnical. Issues like distributed ledgers technology and
virtual currencies are not things that I think everybody has wrapped their minds ar ound in terms of how they
work and what the implications are. Obviously there
are a lot of people who have. But I think, given the
relative newness of this sector and the risks inherent
in some of this technology, it is very important for a
Government —and I will say our Government —to explain how they are going to go about doing it. And I
say that because I know the Government has met with
lots of people, we had a slide presentation yesterday,
it was useful . . . but I have also heard concerns expressed in t he business community which probably
are not going to be expressed directly to Government.
I have been in Government long enough to
know that people do not always tell you what you need to hear. They often tell you what they think you
want to hear. So there are certainly concerns expressed out there. And, as I said, it is a complicated
area. To be perfectly honest, I have done a fair
amount of reading on this and I think other jurisdi ctions have done a much better job of setting out and explaining their approach to both ICOs, the distributed
ledgers technology, and to virtual currencies as well. I
think there is an example of which I know the Go vernment does not think highly of. But I think they did a
good job. One of those was Gibraltar. They have been


Bermuda House of Assembly working on this for a couple of years now. They
passed some legislation around Christmas time. I
think Switzerland has also, through FINMA [Financial
Market Supervisory Authority], done a nice job in
terms of laying out the landscape and explaining the risks, the uncertainties, and how they are going to a pproach regulation and surveillance in this particular
area. Canada and Australia, as well. I know one of the
consultants from Government is actually from Australia.
I say that because I think in some respec ts I
understand there has been a rush to get this legisl ation to try and be there first. I am not sure we really
are there first. I think others have put in place regul ations and there is some legislation. In fact, I was reading on Bloomberg the other day that Anguilla basically
back in December set out initial coin offering legisl ation as well. And I say that because what we are also faced with today, perhaps, in an effort to get this legi slation done quickly (and the Minister gave, at least his
explanation of it), we are faced with six pages of amendments, Mr. Speaker, to this legislation, okay?
Now, six pages of amendments are quite a few
amendments to a 20- page piece of legislation. So I
think it is important in these particular things not to
make mistak es.
And I say that, to be very much upfront about
it, because I do not believe . . . and I am going to stay
pretty close to the ICO legislation for a few minutes. I
do not believe the ICO legislation before us today in
its current form is actually adequat e for the task r equired. And I am going to explain why I think that in a
few minutes. The ICO legislation, the Bill, will certainly attract ICO business. I think the Minister is a great
salesman, I think there are certainly companies here
that may wish to proceed. There are companies all
over the place that have already proceeded whether it
be the United States . . . right around the world. So I
simply think ––that being a reason to rush this is
something which I think is a little bit suspect. I think
the legislation also leaves significant risks for Berm uda unaddressed.
Bermuda, and the Government particularly,
not only has the responsibility for business develo pment, which is what we are hearing more about here, but it also has the responsibility to protec t the broader
interests of the public and Bermuda, and particularly
its hard- earned reputation as a well -regulated jurisdi ction. I say this because in some respects there is a
silver lining here. And I think, Mr. Speaker, you may
have seen it; certainly ot hers have. But the BMA r ecently published a Consultation Paper on the (and I
quote) “ Regulation of the Virtual Currency Business
.” I
think that was a really welcomed addition to this whole area. They explain in a lot of detail the role they would
play. And they did that in a way that was much more
detailed and much more transparent than what Go vernment has done so far. The BMA Cons ultation Paper, and I do not
mean to disabuse the Minister of this notion, was not unprecedented. The BMA puts out consultation p apers all the time. They are a mature regulator, they are used to doing this, and they do it for a reason. And they were doing it for a reason in this particular case
because they needed to explain to people what the
issue was, how they were going to go about it, who
would be involved, and they also expressed the context of blockchain, virtual currency space; they
touched on ICOs as well, and they expressed their concerns about the sector.
I think they also indicated very clearly what
they would refer to as the scope of their regulatory remit, what types of virtual currency business would
come under their remit, what they would require of those entities who wish to operate in this area, and they recognised in quite a bit of detail, in writing in
their consultation paper, the concerns of the FATF
[Financial Action Task Force], the CAFTF [Caribbean
Financial Action Task Force], the O ECD [ Organisation
for Economic Co- operation and Development ] and
others, about this particular sector. And I think that is important because it lays out a framework here.
I do not know whether you have seen it, Mr.
Speaker, or not, but the Consultation Pap er is actually
about 150 pages, and it is quite detailed. It lays out not only a draft Virtual Currency Business Act, it lays
out Virtual Currency Business (Cybersecurity) Rules,
Virtual Currency (Prudential Standards) Rules, Virtual
Currency (Client Discl osure) Rules, a Code of Practice
for the Virtual Currency Business Act, and a Stat ement of Principles for the Virtual Currency Business
Act. I think what is important here is that you are able
to see the whole package; you are able to understand
where they are coming from, why they are coming
from it, and a very clear indication that here is what
they are proposing to do but let us have some feedback about this.
What I think was also interesting was that they
were very clear and quick to point out that thei r remit
would not include regulation of ICOs. That was for the Registrar of Companies and the Minister of Finance. They would do the Virtual Currency Business Act and
the associated regulations associated with that. So, a
very, very different way of approaching it. And I have to say it gave me some comfort. And I am one who
has often said the BMA takes their time to do things.
They are often intransigent on certain issues. But, af-ter all, they are a regulator. But in this particular case I
think they have probably provided a lot of comfort for
people out there that this was being looked at in a careful and certainly methodical way.
So why is it important to do this right (as Mr.
Lacey would say)? Well, it is important to do this right because there are repu tational risks to Bermuda and,
by extension, to our existing international business sector, which, for a good part of our economy, is the bread and butter. We had a little bit of an explanation
1934 27 April 2018 Official Hansard Report

Bermuda House of Assembly by the Premier of what initial coin offerings, or ICOs,
are ab out. He did say ICOs are a method for raising
finance by start -ups or early stage companies. ICOs
generally involve the sale of tokens or, what the legi slation refers to as, digital assets or coins using bloc kchain or distributed ledgers technology. ICOs have
also been (and I will be very straightforward here) an
unregulated means of raising finance in an early stage
venture or project, sometimes referred to as “crow dfunding.” Often the products or services that are being proposed have not been fully define d or designed,
built or tested, and may not even be operational or
generating any revenue. Okay? So, the tokens, or
coins, that are sold in an ICO can serve as a prepa yment for access to a product or a service that will be
developed in the future using the funds raised in the
initial coin offering. In some cases, I think this is a useful way of putting it, they can be seen as a subscription, much as you have a subscription to a magazine, to use . . . it could be an app, or it could be sof tware, or a product or services in the future once it is
developed. And in a lot of cases ICOs have been
used to get around the more rigorous and regulated
capital raising procedures used by both venture cap ital groups and financial institutions.
So, these new ventures are, by nature, highly
speculative and often very risky. Most of the offerings are at a very early stage. They can be conceptual
and, to be very straightforward, may never get off the
ground. So this is an area where one has to have
eyes wide open. I think, if I may, with your permission,
Mr. Speaker, [refer to] page 6 of the BMA’s Consult ation Paper where it says about initial coin offerings,
“Token issuance is generally used to fund a start -up
business. ICO activity has commonly been associated
with insuffici ent investor information, fraud, money
launder ing, and failed projects.”
They go on to talk about some of the risks i nvolved and other things. But I am not going to go there.
It may be a bit light -hearted in a way, but I
was struck by a piece that was ac tually in the Gazette
on April 19
th. It was a Bloomberg story which the Gazette picked up. It is entitled “Investors fear for cash
as crypto founder tweets from the beach.”
Apparently this is Bloomberg in New York.
“Investors in a cryptocurrency startup [called]
Savedroid are wondering whether the founder ran off with their money, the site has been hacked, or if it’s all part of an elaborate joke. . . . founder Yassin Hankir
tweeted a picture of himself at an airport and then holding a beer at the beach sa ying, ‘Thanks guys!
Over and out . . .’”
Now, in the same article “ New York -based S atis Group found that 81 percent of ICOs are scams, according to a report [that they did] last month. ”
So, we are dealing with an area which can be
. . . and I am going to say “can be” . . . I am not trying
. . . I know I will be accused of fearmongering. But I think we have to be honest here. This can be very
risky for people going into it. So, a lot of regulators,
including the FCC [Federal Communications Commi ssion] have taken a pretty strict approach to this in
terms of particularly those coin offerings which are clearly an effort to raise equity financing or that sort of
thing. And I think as we all know, we have seen it in
the paper, there have been hacks, there have been
swindles, there has been vaporware.
So how does an investor, particularly an am ateur investor, distinguish promises from real potential?
This is a growing sector. I think the numbers I saw
suggest that there was $3.4 billion in 2017 raised by
ICOs. Tha t is more than venture capital financing occurred in 2017. So, let me try and put this into context,
because I think it is important to frame how Bermuda
thinks about this. And I know Government has proba-bly thought about it to some degree in this way as
well.
This said ICOs, crowdfunding, initial coin offerings are early -stage entities basically by definition.
Venture capital, which also plays in this space, prob ably a little bit later in this space . . . you recognise in
venture capital that probably 9 out of the 10 inves tments you make are either going to fail or not get very
far. It is only one of those that may get through. So
you are dealing with a ratio of about 1 to 10 in venture
capital. But venture capital people have an advantage that an investor in these areas does not. They are experienced. They are used to dealing with start -ups.
They get to meet the individuals who are behind the company. They get to go over the business plan in an
incredible amount of detail. They often get to check
out protot ypes, working models, and they have an
understanding of the sector and what is going on
there with respect to other competitors or other threats
to the particular proposal which is being made.
So, venture capital people do extensive due
diligence. And I sa y that having been a principal in two
venture capital funds here. So I have some bac kground and some experience in this area. Venture capitalists also have the benefit of a diversified portf olio. But they have lots of failures and lots of what are
known as “walking dead” that come out of these
things.
ICO investments are at an even earlier stage
than venture capital people will normally look at. The
business plans, if there are any, may be conceptual. No developed projects. [There are] questions about
the experience and ability of the promoters to actually
deliver. And often there is really nothing which would sort of count towards financial statements. So I think
we have to be realistic here that ICOs coming here
are going to be trading on Bermuda’s reputation as a
jurisdiction and not vice versa. Okay?
We have something to lose as a jurisdiction if
this is not done right. And when you think about . . .
and I think that my colleague, Jeanne Atherden, and
certainly both Ministers sort of referred to this. When


Bermuda House of Assembly you think about Bermuda’s existing international bus iness sector ––insurance, reinsurance, trusts, asset
management, funds ––up to this point as a jurisdiction
we have been very careful to make sure our legisl ation and regulatory infrastructure protects t he investor,
the policyholder, and that we have, for example with
Solvency II, world class equivalents. I do not believe
that this ICO legislation, the Bill before us, is actually
able to meet those standards. And I am not sure it is
adequate. I am raising my concerns —that is my job as
an Opposition Member —to address the risk for Bermuda. Let me explain why I think that.
Simply taken, Part III of the Companies Act
and the equivalent in the Limited Liability Company
Act [LLC Act], which is Part 10 (which is the Prospectuses and Public Offers section of the Companies Act
and the LLC Act), is being used to provide for initial
coin offerings. Now, admittedly, there are some definitions and some customisation to address the special
nature of initial coin offerings. It is a very efficient way
to do it. What Government has done is simply repur-pose Part III, created Part IIIA, customise it to some
degree for initial coin offerings with some additional
ramifications in there. But at the end of the day, and
the Minister basically said this to us yesterday, this is
a buyer beware approach. The idea is, let the investors decide for themselves once they have the infor-mation. That is what this is doing.
Now, what is the challenge here? Look, I u nderstand we are trying to fi nd a balance between too
much regulation and not enough regulation. But what
is the problem here? We are taking a piece of the
Companies and LLC Acts which are designed for f inancing later stage companies and applying it to
ICOs, which are very early stage and have a much
greater risk profile. In my view, the amended legisl ation is not robust enough to do this adequately.
Now, I understand the FinTech Advisory
Committee is intended to assist the Minister of F inance and the Registrar of Companies to act as a gatekeeper and try to keep out (as we heard earlier)
the bad actors and the scams, and those ICOs which
are clearly . . . I will just say vaporware, basically. This
will happen before the Minister (and this makes
sense) gives consent to the ICO company. The Bill
also is requiring an ICO document to provide infor-mation on the ICO which is required to set out the
risks to the investor that may prevent the company
from achieving its objectives for which it is raising f inance. But at the end of the day, even after this series of steps is taken, by their nature we are still left with
ICO companies that are likely to fail.
So, for the Government in Bermuda, we are
going to have to deal with the fallout —potentially a lot
of disappointed investors. And, dare I sa y, some of
them will probably be Bermudian investors as well.
And it is fair enough to say, Look, you are dealing in
financial markets to some degree. You know, Buyer
beware. You know, You have to make up your own mind. If you can’t afford to lose the rent money, don’t
put it in there. But on the other hand, we are dealing
with a very, I will just say irrational exuberance right
now in this particular area. We are dealing with what I
think anybody in the financial markets would call a “bubble.”
And as far as I am aware, there has really
been no reputational risk or impact analysis for Ber-muda if we have a whole series of these companies
which by their nature are going to be destined to fai lure. Sure, some of them may go through. Venture
capitalists take thi s risk every day.

[Inaudible interjection]

Sorry? Oh, five minutes.
Thank you.
So, what I found encouraging was the BMA
have taken a more rigorous and robust approach in
their draft Virtual Currency Act. And there is a very
sharp contrast between where the Government is in
their approach and where the BMA is. There are some
real philosophical differences there.
I think what is important here in terms of the
Government’s rush to get the ICO legislation out there is that there needs to be, I think, better coordination
between how the BMA is approaching it ––and I know
Government will say, Well, they are a regulator; they
are not going to be able to facilitate this. But there
needs to be a whole package here where these pieces nee d to fit together very well.
My sense would be, my recommendation to
Government would be to not proceed with this legisl ation, bringing it into force, until the Virtual Currency
Business Act is brought in with all the attendant rules
and protections and guidance notes that are there. I
think this is something that is going to help to effectively do a better job in terms of protecting Bermuda’s
regulation.
So, I will finish on this note. I think Cayman
have taken a very interesting approach, given their
strength in the fund sector and management sectors.
They are proposing that they have a jurisdictional platform for asset management in the digital age. They
are looking at things like digital identities, something which I think the Government is also having a look at
here. They have a very large working group of about
100 members. But they have been issuing advisories
as the BMA has in terms of some of the ICO issues.
Now, what I do find interesting is that (and I
do have some connections here) Cayman Enterprise City already has about 50 companies which are
FinTech related companies. Many of them have a lready done ICOs there to fund raise. They have not
done it under essentially the Cayman investment
business legislation. But they are catching securities
issues on their legislation as well.

Hon. Wayne Caines: Point of order.
1936 27 April 2018 Official Hansard Report

Bermuda House of Assembly The Speaker: Yield a minute. We will take the point of
order.

POINT OF ORDER
[Misleading]

Hon. Wayne Caines: Only because you are limited,
Mr. Speaker, . . . because I am limited in ho w I can do
this point of order. This Member is misleading the
House. He has not declared his interests and there
are clear interests that we all know that he must, based on this, he must declare.

[Inaudible interjection]

Hon. Wayne Caines: He must declare his interests in
Cayman. He must!

Okay. So, those have
very littl e relevance here. I am not promoting Cayman;
all I am saying is that I think it is an interesting parallel
in many respects.
But what I think is more interesting is that
these companies have very little presence there. Most of the work is actually done somewhere else. And I think when we look at what the jobs are that will be
created here, I think we have to make sure that this is
not going to work like permit companies where you may have a token presence but most of the stuff is
done somewhere else.
Now, I know we heard a lot of potential i nvestment and the rest of it. But I think Bermuda still
has a way to go before sufficient Bermudians are
trained. There is not a lot of this particular skill set here right now. So I think this issue of jobs and future
potential is still very much optimistic. I think we will
have to see how this works out.
I think there are a lot of other questions which
we can get to when we get to the actual Bill itself in terms of tax and other issues, and also in terms of
how Gove rnment is going to pay for this. You know, in the insurance, trusts, and other areas we have a lot of
funding for the BMA which actually comes out of the
companies themselves. So those are issues in terms
of budgeting for the Registrar of Companies and act ually for Government in terms of the cost of doing this
regulation and this ongoing oversight.
So, in closing, Mr. Speaker (because I know
you are looking at me with your eye on the clock) we need to have a much clearer sense of how all these
pieces are going to fit together. We need to have a
clearer sense of whether there is going to be sufficient protection here for the investor. We need to have a
clear understanding of what the downside risks may
be to Bermuda as a jurisdiction. And I think that is the
only responsible thing we can say.
Thank you, Mr. Speaker.

Thank you, Honourable Member.
Does any other Member wish to speak?
I recognise the Honourable Member from
constituency 36. Honourable Member Scott, you have
the floor.

Hon. Mich ael J. Scott: Mr. Speaker, my contribution
to the general discussion of the ICO Bill will focus on
giving back to Bermuda the elements of this exciting
initiative connected with the Bermuda digital exchange
system which has been introduced by the Minister of
Finance and Premier in his remarks, which has been
evangelised, led, and driven by the Minister of National Security, the Honourable Wayne Caines who sits
near to me, bringing us to this singular place today.
So the heading is how this space, notwit hstanding its millions, as we just heard, the capacity for
millions of dollars being brought into the consolidated
fund and deployed into education in our community,
gang reduction, and it has this marvellous sweet spot of a community involvement.
Now, I did not hear the former Minister of
Economic Development, Dr. Gibbons, address these soft issues. That is not the type of person he is. Frankly, his presentation, I say with the greatest of respect,
was dinosaur -ish. And he is protecting the dinosaur
elements . And I am saying that not wishing to bring
him to his feet.
Mr. Speaker, Dr. Gibbons, the Honourable
Member, speaks to—

Thank you, sir.
The Honourable Member is imputing improper
motive. I think that is most inappropriate at this time.


Bermuda House of Assembly The Honourable Member is not being dinosaur -ish; I
believe that the Member has taken very careful pains
to be able to articulate the concerns that have come
from our side. And I think that the Honourable Member is imputing improper motives.

Hon. Michael J. Scott: I am not imputing improper
motives.

Thank you, Honourable Member.
Member, just be careful of the guidelines so
you do not impute any unnecessary comments t owards any Member.

Hon. Michael J. Scott: Mr. Speaker, thank you. I am
grateful for your guidance.
Dinosaurism is a metaphor for following
something that is fairly ancient. It is the old way of doing things. And we all know that Dr. Gibbons is the
singular protector of that system in our country. He
has to be. That is why he remains here—

Honourable Member, we ar e trying to
keep a tone that does not get us down into a lower
level. I think this debate today, the matter that is before us, is a very serious matter, it is a great turn for
the country, it is a high road for the country. Let’s keep
the debate on a high road.

Hon. Michael J. Scott: Thank you, Mr. Speaker.
So, the standard of Bermuda in this country in
the space of trust, management of trust and finance,
is the standard of Bermuda. But when it is under the management of the former Minister of Economic D evelopment, Dr. Grant Gibbons, it is fine. But when it is
under the administration and management of a PLP
Minister of Economic Development, or the Finance
Minister, it is risky. And I deprecate the speech made
by Dr. Gibbons —

Member, Member, let me help . . . ah,
ah, ah . . . Member, let me help you out.
I think you have a good contribution to make.
Let’s move on to the real gist of what your contribution
can be, and not get distracted with this line of co mments.

Hon. Michael J. Scott: Mr. Speaker, as a Member
listening to another Member of this House from the
Opposition make the kind of speech he made . . . my
role here i s to respond to it. In addition, to make my
presentation as I intend to, as a Member that was a ppointed to the legal and regulatory sector.

Yes, you have every right to make your
point. And I agree with that. But let’s not try and get it
into a level that is lower than what the debate requires
at this point.

Hon. Michael J. Scott: And so the standard of Bermuda in this space of our reputation for being a juri sdiction that is well regulated is the standard of Berm uda. The administrators of it, the civil servants, the
consultants who manage and administer it, are the
same today as they were when the OBA were managing our standard.
And so I deprecate the analysis that there is
some risk and that we should withhold the Bill and
wait for the Virtu al Currency Bill to come. It is co mpletely inane, irrelevant, and makes no sense that this
one Bill that is coming will be an answer to the concerns even raised in the speech by Dr. Gibbons. Just the fact that it comes will not address the kind of attack t hat he made. So, it is just that. It is an attack. It
is an attack.
In his final observation, which is that this is a
case of our model being involved with buyer beware,
and that there is not a presence of the intended onboarders in this country being here, Dr. Gibbons, the
1938 27 April 2018 Official Hansard Report

Bermuda House of Assembly Honourable Member, does not understand, or has not
looked at this carefully enough, I believe. The space —

The Honourable
Member is misleading the House. The reference that
the Honourable Member made in terms of buyer beware was a term that was introduced in the consult ation session yesterday by the Minister, that the Government’s approach was that of caveat emptor . So
that is the reference.

Hon. Michael J. Scott: Mr. Speaker, this was a tir esome intervention because that is not what I said.

[Inaudible interjections ]

Hon. Michael J. Scott: I referenced what Dr. Gibbons
raised, buyer beware. I was not saying that it was not
a part of the set up. I was not saying that. I merely
repeated his words. What he added was the question
of the presence, of the absence of presence, is a feature that he was singling out as a way of raising his
concerns, and the concerns of those to whom he has
spoken, about the risk concern connected with this
initiative.
And really, the reason I said that he has not
studied this area carefully enough ––as the chief executive, the CEO of Binance has just finishe d saying,
Mr. Zhao, just finished saying to me privately, this space is about hubs that are globally disbursed. The
idea is not to have a singular presence in one partic ular place, but to have a presence across hubs global-ly. Now, we will have to get used to this kind of set up.
And this Bill has attracted Binance as being a legisl ative structure that is reasonable and flexible (his
words) enough to make it attractive. And that is what
the headline should be.
But I cannot allow an assault on what has
been a piece of parliamentary skill, evolved into a Bill
by Mrs. Welsh , and in time I will name the entire team
which has contributed to where we are today. When I
first read this Bill that Dr. Gibbons says is exposing us
to risk and has not been well thought out, I had, as a
person who is completely familiar with (as we all are) drafting of legislation, I had the same sense that Mr.
Zhao had. It was a good, it was, indeed, an excellent,
skilful, thoughtful Bill that we have here today.
The Bill seeks to amend the Companies Act,
with your permission, Mr. Speaker, and the Limited Liability Company Act to provide a framework for Initial Coin Offerings (ICOs ) in or from Bermuda. The framework will be implemented primarily through this
Bill, and its associated regul ations and Code of Conduct. So that is the structure. And in the midst of its
triggery we have already seen the interest to inwardly
attract investment. In addition, it tells a story and a llows us to tell the story, the softest story, about how
this new in dustry . . . and I heard someone describe it
as the new pillar. Just because the new loaf of bread
is going to challenge the old bread, the old loaf of
bread, that is the trust management business and the
banking business with which Dr. Gibbons is so fami liar, just because it challenges it does not make it di smissible.
As a matter of fact, we have gone this way
before. Mr. Caines talked about the history of the
sloop. Countries, societies, do experience, if we are
lucky and blessed by the Lord, to experience new trends and new waves. Now, we hope and we pray
that this is such a new trend and a new wave. And we
do wish from the Progressive Labour Party management and administration of it, and certainly from the
executive, control of it by Minister Caines, the National Security Minister, and the Minister of Finance, to control it and to manage it to the best interests of persons
heretofore sidelined. Now, that is the great story that
is going on, and the one that I wish to address.
There is something special about today, Mr.
Speaker, in that a piece of legislation would, in tan-dem and immediately, attract the presence of, not one
$10 million or $50 million player, but two on our
shores —

Meeting.
Hon. Michael J. Scott: Meeting (exactly) . . . meeting
with the executive of this country. There is something
special about it.
And what I find most heartening about it, and I
am grateful that the Minister of Finance and Minister
Caines, the National Security Minister, were kind
enough to invite me t o contribute to the legal and regulatory team. Now, that team, Mr. Speaker . . . and it
must reflect the quality of that team. It was led by Ms. Lydia Dickens, a bright, disciplined chairman of the
working group. And she sat at our initial meetings. I reme mber the first one. I was struck by her knowledge
of the subject, her control of the number of people in
the room, particularly when at our second meeting,
the Minister of National Security arrived, fresh from
the exhilaration of the Alps of Switzerland, and sat
down with us and gave us timelines that made our hair blow back, gave us evangelism that made us sit
up and say we are getting a passion here and we are
getting a story about a real prospect here. It drove
chairman Dickens and her loyal assistant, Ms. Maxine
Binns, to respond. And we all responded.
In particular I single out the response of Ms.
Tyndale, who was our majordomo, ensuring that we were not forgetting the regulatory space and the pr oBermuda House of Assembly tection of our reputation, and ensuring that at the top
of the configuration of our work was know your customer , all of the standards that are normal and credible to the work that we do and have been doing which has given us the reputation that we have.
It was in symmetry, Mr. Speaker, in work that
was dynamic daily, when the Minister came and then
brought blockchain engineers, Ms. Loretta Joseph, who is connected deeply and integrally with FATA and
knows its chair, works with the OECD, and we happened to have been blessed by a synergistic exper ience and the in put of skill and knowledge that resulted
in—no wonder —a document (which I contrast with Dr.
Gibbons’ characterisation of it) . . . with an excellent
Bill that is fit for purpose. The fact that it has a number of amendments . . . may I address that for a moment?
We will pass this Bill today, Mr. Speaker. And
I was saying to Lydia Dickens earlier . . . I was trying
to remember the thesis about the pace of change of
technology. I remember it coming across my mind
when I held the desk of telecommunications and was trying to understand this pace. So it is Moore’s law —
not Brownian law, but Moore’s law. And it was a si mple proposition that the information technology space
moves and changes at a promethium rate; it is changing now.
So, when we have passed this Bi ll today it will
require amendments even five minutes after we have passed it. I am not concerned, nor do I take the characterisation of the last speaker, that amendments are
an indication of lack of preparation. The space makes
up for the need to be responsive, flexible (the word of
Mr. Zhao, of Binance), and reasonable. So the Bill is
fit for purpose. So I contradict and contrast that view,
to which Dr. Gibbons is entitled.
And may I say, when the BMA and all of the
publications that he has presented now , when they
have hit Hansard, the publications from the BMA, that is the role of the regulator —to publish concerns and
warnings. But they must not be interpreted as a cease and desist declaration. This is why I wish to commend
Minister Caines and the Minis ter of Finance for acknowledging, taking advice, taking guidance, and for
Mrs. Welsh, who, having had that kind of warning and
concerns expressed, express it in parliamentary lan-guage in a Bill that addresses it.
Mr. Speaker, as I indicated, I was on the
group . . . I do not think we have disbanded it, so I
think I remain on it. I was minded on the day, I think before the Minister got there, because I knew that this
space was a space for Millennials . . . it is the new
way. It is the new way that we will have, as the Premier indicated this morning, the use of mediums of exchange. And as I understood it occurred to me and
struck me with some force, that young people are going to be managing this in the future. And they are managing it now. These engineers are all under 20,
not even 30 yet. So, I spoke in the meeting, and I believe our
chairperson Ms. Dickens made a note of it, and said it
is important that we have the youth perspective right
in the midst of our work. And Minister Caines inserted
young Glenn Simmons into the position. And he was
there—Wakanda . He was there throughout all of our
work and he has been stellar. And he knows his stuff.
He came into it not as a novice, but he came in with a
great, great . . . and I am made to understand that
young Mr. Glenn Simmons is here—

[Desk thumping]

Hon. Michael J. Scott: Thank you. Thank you, Glenn.
So that part was comforting to me. And then,
having met and worked with some of these players, if
you all google Paycase, for example, this is a compa-ny that has raised . . . again to Dr. Gibbons’ point. I
mean, the reason we have structured this legislation
with such regulatory force is because we do, as I
acknowledged the statement that was read by the
Honourable Member, that there are a lot of bad pla yers out there, and they need to be corralled by good
statutory language so that we know our customer,
know who we are dealing with and they declared
through the White Paper in their statement of intention
who we are dealing with. This is part of the Bermuda standard, and it is no less aptly or actually applied
under a Progressive Labour Party administration than
it would be under a former administration.
But, these young players, these Millennials ,
this new generation, have a deep social conscience,
and a deep social centre. They believe in giving back.
They believe in moving away from the status quo of greed. And that part, when we introduce . . . and it
was the Minister of National Security who brought up
in the midst of all of our blue, sticky papers and whit eboarding, the piece of education, of community, of
support . . . of the implication of gang initiatives. When
that piece was brought up, and I think it came up in
the specific context of 30 per cent of our young, black
males do not matriculate through our education sy stem—

Half.

Hon. Michael J. Scott: Half? (It is the Mincy Report, I
am being advised.)
Everybody in the room was attentive to this
information. All of us were Bermudian, including Mr.
Stuart Lacey, who was there, and we were attentive
and knew of this. And we all with one accord agreed
that this has a proper place in the muscle of the ICO
space, the FinTech space that we seek to attract to
our country.
Mr. Speaker, may I pause here? As the Mini ster indicated, we actually acc ept that we are capable
of addressing the Bermudian issues of joblessness,
immigration reform that makes it possible for us to say
1940 27 April 2018 Official Hansard Report

Bermuda House of Assembly that we are putting Bermudians first. And those points
of policy and those initiatives of policy will go and
must go in tandem with the blockchain initiative. And
for those who are listening, including the Minister’s
mother who has got Fitbit analyses on her mind and
may not be understanding how this all works, save
with a few more classes . . . be aware, Mrs. Caines,
that we ar e still addressing what I know you tell your
son needs to be done by this Government —address
unemployment, deal with the education, deal with vi olence in our community, but, above all . . . I held a
youth summit to thank voters of my constituency earl ier in the month. Things came forward in that discussion with them, such as we can’t leave our parish because of gang considerations to find work.
And what was interesting, I say to my colleague, Mr. Commissiong, I had the women’s perspective, the young, black females’ perspective, who
said, you know, we qualify in a particular trade. But
the foreign worker, who will work for seven days a week out -competes us. I have a three- year old child. I
can’t be out seven days a week. So I am reduced to
doing something el se other than something I trained
for, such as cosmetology, or . . . and, you know, this is
not the female or male that trained as nurses. They
would all be at the Bermuda Hospitals Board. But
these are just young women starting on a trade and hoping in our country that they have a fair shake at
supporting their three- year old kid, or more than one
kid. And they suffer.
Thank God, Minister Caines, that this initiative
has linked into that space in a fulsome way. And it is
not driven only . . . this is not a Bermuda model, having heard the Binance CEO. They have a charitable
foundation. And having experienced it myself . . . I
talked with Loretta Joseph and Joseph Weinberg, and
I talked with Ms. Ferguson, a brilliant engineer. They
all speak without prompting about reaching out to help
those less fortunate. So this is a good story, Mr. Speaker.
This is an excellent story today, and it has d ynamics that cut across dealing with our Consolidated Fund issue . . . not our Consolidated Fund, but our
debt issue; dealing with the raising of taxes in a signi ficant way, in dealing with the deficit, but also, in tan-dem, dealing with our community educational and training modalities. And again, you know, there is
space. The concierge possibilities and opportunities in
transportation, in cabling, in food production, in entertainment, in housing . . . these are opportunities that
our young people, unemployed people, can find new
opportunities for work (if you understand what I mean by “concierge”).
So, provided that the onboarding comes and
continues at the pace and in the quality that we have seen today with the MOU signed with Binance, new entrants, and this certainly deals with the presence,
Dr. Gibbons, of people. Their presence will drive the
need for housing and food pr oduction and food deli v-ery and food purchasing, cabling to their homes,
transportation across, whether by pedal cycle or by
drone, and it is going to drive opportunities for Berm udians to offer these services. And it will not be excl usively to the blockchain industry. They will find that we will start using these services.
These are the dynamisms of this story today.
Those who deserve our fulsome thanks and praise, I have mentioned our Chairperson, Ms. Lydia Dickens;
Ms. Maxine Binns; Ms. Paula Tyndale, who covered
the FATF space for us; Mr. Stephen Gift, of the Mini stry of Finance; Mr. John Narraway, who is an expert in the information technology space, who offered us excellent input on structuring the very IT footprint for this
Bill and for our exchanges; Chris Garrod, an attorney
at Conyers, Dill; Kevin Anderson of the BMA, they were always in the room, Mr. Speaker, and giving their input; Myron Simmons, of Chambers; Sean
Smatt; and Stuart Lacey. And then we were joined by
our overseas guests.
These persons worked at these aggressive
timelines, laid down by Minister Caines for us, without
complaint and without flinching away from the task.
And all good stories have a beginning, a middle and
climax, if it is a good story, and then an end. And we
are certainl y not at the end. We are certainly not at the
beginning of the end. But we certainly are at the end of the beginning in this space of the Bermuda digital exchange system. And the players, we actually made
jokes that this was a movie in the making with the
number of things that were happening, the players
who were getting involved.
So I wish to commend and thank Chairman
Lydia Dickens and her entire team for the work and leadership she has displayed, and getting us to what
we knew was going to be this Bill s o that Minister
Caines could now take to the road on roadshows and wave the flag that Bermuda is now an officially legisl atively regulated area in ICOs. It is a good story to tell.
That is the story that we will, no matter what reserv ations . . . and we we lcome the reservations. But they
should be put in place as reservations; they ought not to be put in place as stopping the initiative. I am
astounded.
We have much to do and to respond to. The
immigration space, the management of it, the man-agement of ref orm, the getting of jobs, the creation of
jobs at Tucker’s Point or in St. George’s, where it is up
there on the top of the hill and in Morgan’s Point, Mr.
Speaker, creating jobs and managing these areas for
the benefit of Bermudians. That will be done. But I believe we have been terribly blessed to have this
initiative dovetail and in tandem take its place on our
shores.
Mr. Speaker —

Honourable Member, you have got
about 40 seconds left.



Bermuda House of Assembly Hon. Michael J. Scott: Oh, well, then, Mr. Speaker,
there is a sandbox that Ms. Dickens developed. Pla yers were on board into the sandbox. They will operate
in it. Once they have operated and shown that they
are ready to emerge and settle in Bermuda as an i ncorporated entity, which will derive legal services and
accounting services, they will be allowed to leave the
sandbox. Others will enter it.
Thank you, Mr. Speaker, for this opportunity
to speak to this most significant and important initi ative.

Thank you, Mr. Speaker.
Mr. Speaker, I have to admit that I am a
blockhead when it comes to blockchain. So, first of all,
I would like to thank Ms. Lydia Dickens for taking my telephone call last night to go through the amendments to the legislation with me, and also for her p atience when she met with me two weeks ago to talk
about blockchain and all of the legislation. And I sat
there with my eyes pretty much glazed over and pr etended that I knew what she was talking about. And I
had read, I think, every definition, every article. I have
surfed [and] googled to [the point that] when I sit down
at my computer, it brings up blockchain on its own.

[Laughter]

And I still do not get it.
So I am not going to speak long. I am going to
speak shorter than my customary three minutes, be-cause this is something that I know absolutely nothing
about, other than in terms of the legislation and how I
feel the legislation is drafted.
The reality is, Mr. Speaker, that our insurance
industry is shrinking. Companies are merging, people
are losing jobs, and we do need another area of rev enue. So I understand the need to get this legislation
passed. I understand that we need to get it done
quickly. And I appreciate the position that we are in.
And, to be honest, what I did not realise was
that blockchain technology and offerings had been
going on since 2014. However, I do not feel so bad,
because the Motley Fool did a survey of some exec utives of US corporations, and 39 per cent of the executives did not know about blockchain technology e ither. So, I am glad to know that I am not alone.
I am not happy about the legisl ation in terms
of—and I shared this with Lydia —embedding legisl ation into existing legislation. I do think that this legisl ation is important enough to stand on its own. I also
made that same comment to the Minister, and he explained to me that the subsequent legislation that is
coming along are all going to be on their own. But I do have concerns, because when you kind of overlay
new legislation on top of existing legislation, then the
law of unintended consequences can come into play.
I appreciate that, as I said, this is the begi nning of the FinTech legislation. I appreciate that we are going to be granted a consultation process with
the other legislation. So, as I wear two hats, both as
the President of BALT [Bermuda Association of Licensed Trustees] and as an MP, you know, I have a
double interest. My interest is in ensuring that the j urisdiction is as good as it can be. And I know that we
have suffered a barrage of all kinds of regulatory i mpositions by FATF and OECD, and we are trying to do
the best t hat we can to manage the regulatory pr ocess, but also maintain that we are open for business
and open to business. And I think that we are doing a
good job.
I will have some technical issues . . . not i ssues, but concerns that I would like to raise when w e
go into Committee, to just talk about with the legisl ation. But at the end of the day, if this is going to create jobs, it is going to educate our young people, if it is going to do positive things for the people of Bermuda
and allow them to maintain or restore their dignity and
integrity, then I am all for it.
I think that we do have to be concerned about
the upcoming FATF review, not in terms of utilising
scaremongering or fear tactics, but to just be cogni-sant of the fact that we need to have a good as sessment because it will impact the jurisdiction no matter
what innovative legislation we have. So, it is important
to just keep that on the horizon.
The other thing is that one of the things that I
found most interesting about blockchain, and the Mi nister mentioned it, is that it can be used for land title
registration. And in doing all of the reading that I did, I
read about a woman who lived in the Honduras. And
she had a house. And she had the title to that house.
And the law enforcement agents came to her and tried to kick her out of her house. And she was able to ev idence that she had title. But there was another person
who also said that they had title to the property. They
engaged in a huge legal dispute. At the end of the
day, she ended up losing the house by the time they
proved that she did have the title to it.
And so blockchain, from what I understand in
my reading, is something that could assist in land title
registration so that incidents like that would not happen. I know that the legislation as it is currently drafted
is only in respect of digital assets. But I am hoping
that it will be expanded or additional legislation will be put in place to expand the utilisation of blockchain.
I think that is all I have to say. I will wait until
Committee. As I said, I have some comments on the legislation itself. So when we get into Committee, I will
discuss that. Thank you, Mr. Speaker.

Well, thank you,
Mr. Speaker.
It gives me pleasure to be able to contribute to
this debate. We had the opportunity yesterday, and
we were very appreciative of it, to have a roundtable
with th e Minister and the technical officers in which
the intent of the Government and the underlying concept, for those of us who may not have understood
and just to reaffirm the knowledge that some of us may have had, was able to be articulated again yesterday. And that was a situation in which we apprec iate the opportunity to listen and to hear.
There were some things that arose as a result
of that meeting and, obviously, things that when we
have concerns . . . It is interesting that when anything
is expressed that is not in absolute lockstep with what
the Government anticipates hearing we hear sighs
and Oh, you can’t be serious! and stuff. But I think we
would be remiss in our responsibility if we did not
point out areas with which we had concern. And that
is our duty and our responsibility as the Members of
the Opposition.
Let me say at the outset that I probably am
one of those who had almost been blessed, by default, with some knowledge with respect to not just
blockchain, but also with cryptocurrency. I think an ybody who is a parent of one of the Millennials would have some indication that they dance to the tune of a
different drum than we do as their parents. And when
you have a now -33-year-old, whose life has been e ngaged and engrossed with computers, and everything
related thereto, and things like coding and stuff that, to
my mind coming along may have been foreign, it is to
them the way that you operate. I believe my son was
14 years old as a student at Saltus at the time when
they actually introduced th eir entire curriculum on laptop computers.
Well, in our day, we actually had, you know,
pencil and paper. And do not talk about having a calculator because that was non- existent in our learning
and educational experience. Our young people had
better expos ure. My older son certainly would have
had better exposure to technology than I did. And I did
not learn much about computers until I actually went to college as a mature student. But with our young
people, when they start to talk, they all have little laptops, they all have little iPads, they have all kinds of things with which they engage. Therefore, their level
of understanding is a little bit deeper than might be the
norm for us.
So, when it comes to cryptocurrencies and
what an ICO will do, enabling t he technology in order
to be able to advance the concept of cryptocurrencies,
the first thing that came to my mind was recognising
that the concept of virtual currencies was effectively
advanced because there were those who did not wish
to operate in the t raditional banking fiat currency env ironment, and there was a way around that. And this
legislation will enable companies to establish the
technology that would support that extra traditional
banking environment.
Now, the one thing that I did express to t he
Minister yesterday when we had the opportunity was
my concern for the integration between the normal currencies that we are accustomed to and that which
obtains on the virtual currency spectrum, because at
some point in time, money will come out. You wi ll
have your virtual; and then you cash it in. The money
will come back in. So, having an ICO is important; having the legislation that surrounds ICO companies
and corporations is going to be critical in order to ensure that we do not have w ild, Wild West , and that we
have the ability to weed out any players in this space
who may bring negativity to the reputation that we
have developed as a mature jurisdiction.
One of the things that I think it is important to
mention is that Bermuda stands out as a matur e,
regulated jurisdiction. And it has done basically from
the year dot. Because I think that founding fathers, forefathers, those who came before us had a signif icant recognition as to the limitations that we had as a country, in terms of our geographical size, as we
punch in higher -weight categories. And in so doing, I
believe they recognise that if we have a pristine juri sdiction of which we can be tremendously proud, then we can be the example for the world to be able to of-fer a product and to have peopl e pounding a path to
our doors. And I believe that that is what we have
been able to do.
Now, the one thing that I found curious with
this legislation was the cost of engagement. As I
spoke to the Minister yesterday when he talked about establishing another pillar of the economy and reco gnising that, ultimately, we will have significant debt . . .
we have, not we will have . . . we have significant
debt. And, ultimately, we need to, as a Government,
ensure that there are processes and procedures and
situat ions in place to help us to pay down on that i ndebtedness.
And what I found very interesting, when the
Minister said it would be $5,000 for a company to op-erate or to register under this ICO, I looked at him and
I said, Minister, this is a matter of multi plication. It is
going to take an awful lot of companies at $5,000 in
order to start to make a dent on our $2 billion debt that we have. So, I think that the reality of what we are


Bermuda House of Assembly doing, recognising that we want to create an environment in which we are able to embrace as many legit imate operations as possible in this space, we also
want to ensure that we are not giving away our services.
You know, I think when you start to think the
cost is almost $5,000 when you think in terms of insuring your house, that is going to cost you $5,000 ann ually. So when you think in terms of a company esta blishing itself, and with the potential of the amount that
is likely to be raised in terms of revenues on an ICO, we are not talking peanuts. And I think that we need to
consider whether, in fact, the amount that we now
have as the entry fee (if I could put it that way) is a ppropriate.
We heard the Minister indicate that there is a
company (citing an MOU) . . . that there are $10 mi llion available from them for education. W hen companies have that kind of expendable income and they
want to go into this space . . . and I am glad to know
that it is only going to be a legislative, regulated com-pany, that this whole technology is deemed to be, I
think the Minister called it restr icted, as the Premier
called it a restricted business activity. And that is a
good thing to know, that the activity is restricted.
So, it is important also to recognise that, notwithstanding the peripheral benefits that will enure to
Mr. and Mrs. Bermuda, this ICO legislation is not
speaking to that ilk. It is not speaking to the person . . . Because Mr. and Mrs. Bermuda . . . I, as Pat Gordon-Pamplin from Loyal Hill, am not likely to go to the
Registrar of Companies asking to be registered with my white p aper that is necessary for an ICO, because
that is just not where I would participate in that env ironment. Where I may be able to participate and
where some of my friends and fellow Bermudians may
be able to participate is in some of the ensuing jobs
that might be created.
And we did ask the question. I think the Mini ster indicated that his perception, at least initially,
would be that in the compliance sector. And he gave
the example of some of his colleagues who may have
studied law who may not now still be operating in that
space because of various circumstances. And they
find themselves in a position to be able to take advantage of a compliance job and opportunity. Well, clearly, compliance is something that is critical to the
success of any legislation that we bring as far as the
company is concerned.
But I was interested to know how we were going to meander in and out of fiat currency versus vi rtual currency. And notwithstanding that I also recognise that the Virtual Currency Business Act (which is
comi ng next) is going to give us the meat behind
those bones, I think a debate of this sort, which enables the money to be raised or the value to be raised, digital assets to be raised, we cannot have this debate
without ignoring what will come next. And we ne ed to
make sure that we protect our jurisdiction, as has been done since the beginning of time. And I think
that is critical, and it is most important. (I think my ot her colleague will speak to that. I am going to leave that
comment.)
We recognise that AML, KYC and ATF are
critical elements that must be considered when we are talking about the preservation of our jurisdictional reputation. So AML, which is anti -money laundering;
KYC, which is know your customer ; and ATF, anti -
terrorist financing, are critic al elements of what we
wish to ensure that we guard against in order to be
able to keep our reputation intact. And under those
circumstances we also have to look at the manner in
which our existing institutions will, in fact, interact with
customers who op erate in a virtual currency space,
which will be enabled by this ICO legislation, to en-sure that they are not discounted from their ability to have their normal banking regulation defended and
protected.
Notwithstanding, as much as we would like to
believe that virtual currency, which is the cutting edge,
and as the Minister indicated, we are going to have
new regulations . . . We are going to have new legisl ation. We are going to have amendments to what we
are doing today because of the rapid pace of the
changes that exist in this particular space. But we
want to make sure that when we do so we recognise that everybody is not going to want to go down that path. You know, as one who is tremendously risk -
averse and very, very cautious as an individual, as I
explained to somebody the other day, I want to be
able to take my sixpence to the bank, give them my
passbook for them to deposit my sixpence, and I want
to go back in six months’ time, take out my
threepence and show evidence of it on my passbook.

[Inaudi ble interjections and laughter ]

But that is the kind
of risk avers ion that people may have. As the Minister
indicated that the whole concept of virtual currencies
is a caveat emptor environment, it effectively is saying
that, you know, everybody is not going to want to op1944 27 April 2018 Official Hansard Report

Bermuda House of Assembly erate in that space, notwithstanding that the technol ogy and the availability will be rapidly evolving. But I
think it is important to note that there are traditionalists
who will continue to operate in the manner in which
they presently operate. We want to ensure that, for
those who want to think that I can be a little bit off the
edge , people who think that there is a possibility to be
half-pregnant, that you could sort of step—
[Inaudible interjection]

So, in this env ironment there are those who would want to say, I
want to try this. But I will reserve this. We just want to
make sure that the protections are there. And I know that that will come under the Virtual Currency Bus iness Act, at that point in time, for protections.
But the actual start -ups that we have, the u nfortunate history of some of the non- traditional fun draising IPOs and now also some ICOs, we have found
the history that . . . research (I should not say history,
but the research) is showing us that some of them
may be prone to failure. And that goes for any inves tment that one would make. So I think that it is i mportant that we have the oversight that effectively says that before you are able to operate in this jurisdict ion
in Bermuda, in this space, in this virtual currency
space requiring an ICO, we are going to make sure that at the very least, at the outset, you present the
necessary documentation that we are able to examine
and to at least minimise the possibility that there will
be risk or harm financially to those who might invest in
your ICO. I think that is critical for us to find ourselves
protected, from that perspective. And, clearly, we want
to ensure that we protect our people.
I wanted to speak to the BMA a nd its consultation paper. The Minister indicated that this was per-haps unprecedented and unheralded for this level of consultation paper to be out there. I believe my honourable colleague from constituency 22 may have
mentioned it. But when one operates i n the environment in which I do, in which regulation is the key to
the success of our jurisdiction and has been so for a
significant period of time, one will be fully cognisant of
and familiar with, and having the pains of, the consultative process that has been engaged upon by the
BMA. [Coughing] Excuse me.

It is because you
have to let people know what it is that you are attempt ing to do, what it is that you have in mind and
how can we enhance this so that, once the final product is completed, then you know that what you have
got is something that is effective and able to be i mplemented. So, that is the key that we have been able to enjoy as a business environment and as a sophist icated jurisdiction.
I think it is also important for people to understand that this ICO legislation is perhaps not th e area
that we can sort of hitch our cart to, to say that this horse is leaving the station, it is out of town, I want to make sure that I jump on. Ultimately, it is the structure
that enables the next step. And I think that if I get
nothing else across today, it would be that this is not
what the Minister indicated earlier . . . and I am not
trying to discount his comments. But for Mr. and Mrs.
Bermuda, this is not the space that they are likely to want to be engaged in or that they are likely to be e ngage d in at this sophisticated level.
So when you have corporations wanting to set
up here, obviously it is better to have some legislation that surrounds it than to have none. If there are co mpanies who are operating or who are established with the intent of operating in this arena, you certainly want
to make sure we do have ourselves subjected to the
CFATF review that they do not find us, as a jurisdi ction, being deficient —which is one of the comments
that I made in an earlier debate. And not intending to reflect, but I think it is important for us to realise that
we have an obligation as a jurisdiction to pass our
investigation. It is not that we can sort of say, Oh, well,
if this doesn’t happen ( as the Junior Minister indicated
this mor ning), we’ll give people more time.
We have to make sure that we minimise the
possibilities of failure. And while the Junior Minister
may have taken exception to my comments indicating
that I wanted to ensure, to be helpful at the outset,
that if there are likely to be pitfalls we want to identify
them, minimise them and eliminate them, that it is because our responsibility as an effective Opposition is
to be able to say, We see that this is a challenge. As
somebody who works in industry, we see that these can be problems, and therefore we want to eliminate
them. And let us work together to do so—as opposed
to people taking a defensive position.
So I did want to highlight, Mr. Speaker, that,
obviously, job creation is critical. You know, we can hear all kinds of cynical comments coming from the

B ermuda House of Assembly other side of the aisle to ask, Well, what has happened over time? We also have comments that can
come from this side of the aisle, saying, When you’re
talking about the concerns for Mr. and Mrs. Bermuda,
what policies and programmes were implemented dur-ing the 14 years of the prior administration? But looking back is a lot easier than looking forward.
So my belief is that looking forward we have a
responsibility to work together as Members of this Honourable House to determine that which is best for the country. And if the Government believes that this ICO legislation is the best that we could do at the moment, and I say that respectfully, because ideally,
we would have, as my honourable colleague indicated, a stand- alone piece of legislation. Obviously, wit hin the time frame that has been afforded to be able to put this legislation in place it was easier to be able to append it to an existing piece of legislation. But what would have been ideal, given that this was an intent
from day one of the new administration, [is if] they
would have started to work on this from day one. Because the companies that have formed who have
come to Bermuda to start to form, to operate in this space, obviously they have been under the purview of
the Registrar of Companies because they would have
had to register with the Registrar of Companies.
So we want to make sure that step by step by
step, not only can we oversee what is happening, but we can control what is happening for the benefit and for the preservation of the risks that our reputation
might face if we do not get it right.
Those are my comments, Mr. Speaker. Thank
you very much.

Thank you, Mr. Speaker.
Mr. Speaker, it is a great day for Bermuda! I
mean, the opinion received by Standard & Poor’s, u pgrading Bermuda’s rating, followed by the news that we got as per the press conference a little while ago,
Mr. Speaker, with the Premier concerning the MOU
with Binance headed by Mr. Changpeng Zhao, orig inally a native of Shanghai, China, is big. And the
commitment of $10 million to fund technological ed ucation of our young people is really good.
I might just remind people, only a few days
ago, we heard of the investment put into or allocated at BHS [Bermuda High School]. And I spoke about the digital vibe that this is likely to exacerbate. This can help to redress that by pouring money into those ar eas and into those student bodies that have been too deprived to get on top of this train, this revolution. Mr. Speaker, you may remember that in 2015
I had a take note motion in this House talking about technology, its impact, automation, robotics, on our labour markets. And that was in 2015. Mr. Speaker, if I may, I just want to open up here formally with some comments in my opening around that motion.

I said then, or wrote, “The
ancient Greeks had two words to denote time.
Chronos, which speaks to the steady drumbeat of
mundane time, the artificial passing of seconds, minutes, hours, days, months, and years, ad infinitum
onto seeming eternity —time as defined by man. And
then there is kairos, which refers to the quintessential
moment, a definitive event, which represents a trans-formative moment of opportunity that ushers in the
new. Therefore, kairos is pregnant with destiny, the
transcendent moment which, seemingly, stops the mundane time of chronos in its tracks. Perhaps it is
vote by declaration of war, or the moment the last bu llet was shot in anger and the battlefield fell silent, or at
the micro or personal level by the white body of a f emale dancer as her performance produces the deep and profound sense of catharsis and tears in the eyes of the discerning viewer at that precise moment.”
Mr. Speaker, I contend that this has been a
historic d ay for Bermuda in this sense: I remember
reading as a younger man in 1988 or 1989, or som ewhere around that time, in perhaps Newsweek or
Times . . . back then, people went to those hard copy
magazines to get information as opposed to Google. And I remember that you had the economist Milton
Friedman giving an interview where he said that, I magine that one day in the future, a place like Bermuda— which even then was burnishing its offshore reputation— issued its own virtual currency. This was in the
late 1980s. Look what has happened now.

Look at what has happened
now, Mr. Speaker. Milton Friedman. This is a historic
first for Bermuda, but not only for Bermuda, for the world. And I am sure that we are prepared to take ad-vantage of it.
Mr. S peaker, I hear d of t he H onourable Mini ster w ho . . . first I w ant to say b oth he, t he Premier an d
the Minister . . . I am tellin g you, as youn g men black
men in this c ountry, they are qualified, t hey ar e the
spearheads who have be en able to take that baton
from ear lier leaders of our par ty and of our c ountry
and help lead us int o the 21st century. That i s what
they have done. And they both need to be commended for the work that has just been done.
[Desk thumping]
1946 27 April 2018 Official Hansard Report
B ermuda House of Assembly Mr. Rolfe Commis siong: And believe me, this work
shows great promise. And we will grow from there.
Mr. Speaker, what is FinTech? FinTech, sim ply put, is an economic industry composed of companies that use technologies to make financial systems more efficient. And in this House, Mr. Speaker, I hear
people talking about the BEDC [Bermuda Economic
Development Corporation] trumpeting FinTech some
years ago. But I know, and you know, that in this
House many of us only heard that term FinTech in this
House when we were in Oppos ition, going back about
close to four years ago, largely from our former Leader, who is no longer in the House right now. That is
where we first heard about FinTech. This party has
been talking about these issues since we were in O pposition.
Now, I know t hat there are people out there,
and we heard it from the Opposition, and it is a valid
argument, [asking], What is in it for Bermudians? How
can this industry do what the previous iteration of i nternational business as it was established over four decades ago (let us say, benchmark 1988) did not do
for many Bermudians, particularly Bermudians of col-our? Particularly our educated people? And what I
mean by that is, as many of you will know, we have in
the international business sector which currently ex-ists reinsurance and insurance, et cetera. We have an
industry where there is only one Mr. Patrick Tannock, after four decades. By this time, we should have had at least 30 or 40 Patrick Tannocks.
What led to the underdevelopment of one
segment of our community to such an extent that they still play only a marginal role in Bermuda’s most lucr ative industry? Meanwhile, within Bermuda’s public sector they are all over the place. Our most able and most educated black Bermudians have dominated the
public sector. It did not happen by happenstance. It
did not! This was put in place, this structure, during
the same time when we were transitioning to a more democratic Bermuda. It was reported to Henry Tucker, in the celebrated conversation with the Governor, who
was getting increasingly concerned about the ongoing
unrest, the ongoing what people say were distur bances that were occurring, the struggle for civil rights, for racial justice in the country, for labour rights in the country . . .
When asked by the Governor, because of the
British concern, what was he going to do to provide good- paying jobs for those educated black Bermudians, he replied (he was then the Government Leader),
Well, we can put them in the public sector, but the
private sector, our people are not r eady. And thus you
see the roots of the current bifurcation along racial
lines in this society! And we paid a big price. When I
say “we,” I am not just talking about black Bermudi-ans. White Bermudians, too! The country paid a big price for this.
Well, this Government is not going to let this
happen with respect to this new opportunity with this new economy we are creating. We are not going to let
this happen. Mr. Speaker, I was so enthusiastic. I felt
so proud of this young man right here. And even if this
thing does not go anywhere tomorrow, he has already earned a place, I think, in one of the pantheons of one of our great leaders. He tells me he went to a very well-known law firm. And they had a young black pr ofessional woman there. But, of course, she was b ehind all the other leaders in that law firm’s office. She was there to provide a token presence. But he made sure that she was not going to be an afterthought, a token presence, and made sure he brought her to the front. And her colleagues had to allow her to exercise
the undoubted talent she had and the leadership she
possessed.

And she is now going to
play a frontline role in that private sector company. That is what we are talking about. Okay? So people
ask, What’s in this for Bermudians? And what they are
saying in coded language is, What’s in it for black
Bermudians?
Keep your eye on this space. Because leaders like David Burt, the Honourable Leader, Premier of this country, and Minister Wayne Caines, National Security [Minister] are going to ensure . . . and this
PLP Government is going to ensure that 30 years from now we are not going to see replicated what took
place with respect to the current IB [international bus iness] ecosystem that we have inherited.

So, I just want to say this,
Mr. Speaker. We want a collaborative relationship with
these cutting- edge innovators from wherever they
come. We are not going to discriminate against them; but they must understand that we are doing business
the new way, that we are looking for companies that
are going to be diverse, that are going to eventually
help Bermudians, assist Bermudians, help educate Bermudians. And the actions of Mr. Changpeng Zhao and his [Binance] are a fine example of the sort of collaboration we are looking for.
When our National Security Minister came
back from Switzerland, went over to Davos, and of course, I was jealous —never been to Davos yet.
(When will I be able to go to D avos?) Anyway, when
he came back, and I heard [a comment] someone had made earlier to my honourable and learned colleague (I know, Mr. Speaker, you have issues about calling
him “ learned, ” but he is learned, in my eyes). Michael
Scott talked about his evangelism around this issue.
And I listened to him. And he is perfectly right. That is
about the most apt word he could have used, the most accurate description.


Bermuda House of Assembly The Minister says that he found another, what
I would call alternative “Davos” taking place not too far
from the main event. And that place was all these
young entrepreneurs who had been pioneers in terms
of blockchain and, more particularly, the digital asset revolution. And he came back —wow! His mind, as he
said . . . I am going to age myself here. I am 61 years
old now as of another two weeks. He came back with his mind blown and told us about this great new o pportunity. And he has been persistent in pursuing that opportunity, not for himself, but for Bermuda. This is going to be one of the more significant
moments in Bermuda’s history as a country in terms
of finally being able . . . still early days yet. But all ind icators are that we are finally going to be able to bring
some degree of diversification, in real terms, to this
economy. How many y ears now have we been crying
about that? Ah, too dependent on reinsurance and
insurance . The hotel industry has been in structural
decline for over three decades, and we need to diver-sify this economy. Both parties have been singing this
song for the last five years, as my colleague from
constituency 26, Mr. Neville Tyrrell, would tell you.
Well, it looks like we are at least going to be able to
say we are bringing a level of diversification.
Now, getting back to this canard about . . .
well, I was just going to . . . sort of cynicism, I heard
someone say . . . Well, I am going to use it too, surrounding these types of initiatives, about, you know,
will Bermud ians benefit . What we are going to make
sure of in a tangible way . . . let me tell you what we
are going to do. We are going to have a host of opportunities in what is known as providing concierge services to these business entrepreneurs and companies
that are on- boarding, who are coming to this safe haven. And we are going to make sure that those persons who organise and who provide those goods and
services for these companies and the individuals wit hin them are going to be people who look like Berm uda.
So, the days when all the cream is going to
one sector of our community, which has led to a host
of major social problems —let us be honest about it —
are over. They are over. Okay?
Now, on the same issue of diversification, for
example, insurance- linked securities, many of us naively thought that this would be the ticket that would
help to offer . . . ev en though within the insurance/reinsurance matrix it became a tremendously
successful new iteration of how insurance is provided
. . . but it provided little in the way of jobs and real,
real benefit overall for Bermuda. But this is going to be
different.
Second, I hear people talk about potential
reputational risk or harm to Bermuda. Well, let me tell you something. Under the previous Government, and I will be honest, even under the previous PLP Gover nment, we had a ticking time bomb that continues to tick. And I am hoping that we address it. And that is those companies like the Apple’s and Google’s, who,
through tax arbitrage, have been successfully using
Bermuda to avoid billions of dollars in taxes in their
home countries.
Hey, the bottom line is they have been doing it
without having a physical presence here; or any real tangible benefit to Bermuda. And over the last four or
five years . . . as a Member of the Opposition then, I
remember every year, or when international global
organisations called us out on that, saying, Hey, look.
Either we need to close down that particular line of
business (although the law firms and the entrenched
law, the big ones, were crying murder if we decided to
go down that road ), or at least charge them a fee that
begins t o compensate us for the damage that they are
causing to us reputationally, globally!
For example, when the Premier went over to
the conference (what was it, just after we won the
election?) and the EU, the only area that they could
move in a way that prod uced some vulnerability and
threat for us was to say, You’re having companies that
are, basically, in some computer file in your domicile,
but they have no physical presence—the same co mpanies we are talking about. That is where the reput ational risk has c ome. And we need to be very careful
and ensure that these players have a presence and
are going to produce jobs, but also help to insulate us from that type of global threat.
Now, the investment in education needs to
proceed. As I alluded to earlier, we w ere the ones in
this House who not only talked about FinTech, we talked about STEM and STEAM education. We need to move in that space. Mr. Zhao has talked about that
$10 million. We need to ensure that the work of Cora
Wells, Connectech, working in collaboration with the
Ministry of Education and the Minister in ensuring that
Bermudian children, seven, eight, nine, ten, eleven
years old —a lot of them from low -income families,
many of them I represent or I represent their parents
in places like Middletown, C urving Avenue, and all
around that region and other parts of the country —
learn how to code.
And then, some of those will then learn how to
programme. Because it is not just the jobs that are going to be available now —for example, within compliance. But ho w we can ensure that 10 years from
now those seven- or eight - or ten- or twelve- year-olds
are able to move into significant positions in this i ndustry, because this industry has to be sustainable if it
is really going to be worth anything to Bermuda? It
has to be one that 15, 20, 25 years from now is still here and our children’s successive generations, Mr.
Speaker, are moving into those positions.
Compliance. After high school, we have an
excellent programme up in the Bermuda College. And I can talk to th e Member from constituency 22. He
was one, as well. We have a man, Mr. George Thomas, the son of Dr. George Thomas (now deceased),
who sat in this House. He has been one of the major
1948 27 April 2018 Official Hansard Report

Bermuda House of Assembly spearheads. He is now living back in Bermuda, at
PwC ensuring that a compliance course be established at the Bermuda College. The course is called
the RCA Bermuda Compliance Certification Pr ogramme. And it is not onerous in terms of providing
the tools by which our young Bermudians of college
age or older, even those who are in another profession can now go back and get the tools to become
certified compliance officers.
I believe, and somebody can please, . . . a
point of order maybe from the Member from constit uency 22 . . . I am even talking about maybe a year -
and-a-half cour se, something like that.

[Inaudible interjection]

Probably less. We have
heard from both the Premier and the Minister of N ational Security that, at least in the short term, that is where the desperate need is. So, we have a course
that, perhaps in 11, 12, or 9 months, we can get them
at least level -one ready to take some of these jobs.
We also know that there are a number, a score of compliance officers who, due to the recession, have
been unemployed or underemployed. And we need t o
get them back in the industry actually servicing this
need.
Mr. Speaker, how much time do I have left,
please?

No, I know I do not. I do
not.
Now, Mr. Speaker, I talked about the potential
this has in a very real way for jobs, for training, for education. But let me say this. One of the biggest fai lures in the previous PLP Government, not theirs
alone, between 1998 and 2007 or 2008, was that
while facilitating and shepherding the greatest ec onomic boom in Bermuda’s history we were blind, as
were the previous UBP Governments before that, to
the great damage that unfettered economic expansion
was doing, particularly to low -income, lower -middleincome Bermudians. Again, the reality of Bermuda—mostly we are talking about black Bermudians —the
rampant inflation in the economy, housing going up
through the roof, housing costs and all other types of
costs.
My only caveat here is that if this is the real
boom that we are looking at, then we need to really
accelerate the implementation of certain public policy
objectives to be able to ameliorate the potential da mage that this cycle of rapid econom ic expansion is go-ing to represent to vulnerable Bermudians, econom ically. And how do we do that? We have already got
three principal initiatives entrain. And they all need to
come to the table. Mea culpa. The Living Wage
Committee, that committee’s work i s nearly done. We
are determined (Mr. Speaker, I am not going to turn
this into some interim report) to have it before this
House for a robust debate before we break for the
summer. It is only a matter of weeks.
Secondly, the work of the Cost of Living
[Commission], headed by Senator Richardson. And
thirdly, the work of the Tax Reform Commission. B ecause we are going to need those public policies to be
put in place, Minister of National Security, to, again,
ameliorate the effects of having Bermuda produce
another economic round of activity on steroids. That is
my one caveat. So it is not just good enough having this new industry come in and all these great players
worth hundreds of millions and even billions of dollars.
We also have to learn from our mistak es of the past
and ensure that those public policy niches —and there
are one or two others I have not called, reform of
health care, of all that —are in train, Mr. Speaker, running on the same track.
Lastly, let me just say this, Mr. Speaker, about
blockchain. And for my mother out there, okay, and
dear Ms. Caines, my constituent, imagine blockchain
as the train tracks upon which applications, such as the digital assets, the ICOs that we are talking about
here, those exchanges, run upon. But it is not the only
application for blockchain, as was noted earlier by a
number of speakers who were talking about distrib ution networks, where you are talking about settl ements, when you are talking about the ledgers that can be used in terms of property. All those are s ome
of the expanding ecosystems, to use that buzzword
again, that are tied into this basic application.
Mr. Speaker, we had a company here. I do
not know if they are still domiciled here, the Transport Minister can probably confirm that. We are talking
about Moller -Maersk, the shipping—

[Inaudible interjection]

They are still here? This is
the power, the potential power of blockchain.
Mr. Speaker, if I may, again this is quoting
from Bloomberg, an article written by Kyunghee Park .
And again, it was in Bloomberg. And I will just give a
couple of excerpts: “Globalization has brought the
most advanced trading networks the world has seen, with the biggest, fastest vessels, robot -operated ports,
and vast computer databases tracking car goes. But it
all still relies on millions and millions of paper doc uments.
“The last throwback to 19th century trade is
about to fall. A. P. Moeller -Maersk” (again, a Berm uda-domiciled company) “A/S and other container
shipping lines have teamed up” (in other words, they


Bermuda House of Assembly have formed a consortium. You have got FinTech; I
guess now you have maritime tech) “with technology
companies to upgrade the world’s most complex logi stics network.
“The prize is a revolution” (listen to this, now)
“in world trade on a s cale not seen since the move to
standard containers in the 1960s —a change that us hered in the age of globalization. But the undertaking is as big as the potential upheaval it will cause. To make
it work, dozens of shipping lines and thousands of
related businesses around the world —including
manu facturers, banks, insurers, brokers, and port authorities —will have to work out a protocol that can i ntegrate all the new systems onto one vast platform.”
I will wrap up here with this, Mr. Speaker.
They say this would be the biggest innovation in the
industry since containerisation. And what makes it all
work is the blockchain. That is where we are heading,
Mr. Speaker.
So, Mr. Speaker, this Government has hit the
ground running for the last five or (what is it now ) seven months . . . eight months? No, actually it is a little longer than that, under 200 days. And again, with this
young, dynamic leadership, I am sure that persons
like the lamented Ira Philip, Eugene Blakeney, Freddie
Wade, and all those great giants who contributed so
much to this country . . . these are early days yet, but I
have seen a sense of optimism in the country and a growing confidence about what we all can achieve, all
of us together.
And I want to thank you for your time, Mr.
Speaker.

Thank you, Honourable Member.
Does any other Honourable Member wish to
speak?
No other Honourable Member wishes to
speak. Premier.
Hon. E. David Burt: Mr. Speaker, I would like to
thank Honourable Members for their comments. And I would like t o thank the Opposition for their tacit su pport in this endeavour.
As the Minister of National Security explained,
this is the first step in a number to come. It is complex.
It is not easy. And it is not easy to understand.
Imagine if you were living in the 1800s and
someone told you about this thing called “ electricity. ”
And you just could not wrap your head around how something could work without someone pushing it.
But it just does. And you cannot actually explain it except for saying, It just does. Or imagine, in the advent
of the telephone, when no one can actually explain it,
that you can say, Guess what? You can talk to someone who is 100 miles away and talk to them intimat ely. And you will not be able to explain it, but you just
say, It just does .
Or with the invention of the Internet, which,
Mr. Speaker, was invented 50 years ago. The Speaker: Yes.

Hon. E. David Burt: And 50 years later, we are se eing the transformational power of which it has. There
are persons, Mr. Speaker, who are far smarter than I
in the area of technology who have stated that this
invention, this creation, this new protocol will change
the way in which business is done, which will change
the way in which economies will work.
If we look at the top companies in the world,
Mr. Speaker, the richest and largest companies in the
world, Mr. Speaker, they are now all Internet companies. Twenty years ago the top companies in the
world did not exist.

Yes

Hon. E. David Burt: In 20 years, Mr. Speaker, we
may not know what that looks like. But this Gover nment is determined to make sure that as this new i ndustry develops Bermuda is able to play a part.
Now I hear, Mr. Speaker, the concerns. And I
hear the statements from the other side expressing
caution, making sure that we understand the risk. Mr.
Speaker, we get it. And when I meet with persons,
whether they be in the business community, both here
and overseas, or whether I meet with people in my constituency, I make it very clear that this Government understands the res ponsibility of which it has to the
future of this country.
I make it very clear that this Government understands the responsibility of which it has to the f uture of this country, because the economy which we
have right now was not built overnight, and we are not
going to do things that are going to risk it. And that is
the precise reason, Mr. Speaker, why we have this
today, because unlike other countries where this acti vity is taking place with no regulation whatsoever, we
are going to make sure that we pr otect the economy
which we have. And so as we go forward with these
items —and the next item is set to be tabled on May
11
th—we will continue to consult with stakeholders.
We will continue to consult with the Opposition. We will continue to consult with the BMA and we will continue to ensure that there is buy -in for the direction of
which we wish to go, Mr. Speaker . But make no mi stake—
[Timer beeps ]

Hon. E. David Burt: —this Government will lead on
this initiative. This Government will make sure that
Berm uda is ready for the future, Mr. Speaker, and this
Government will —and it is this Bill and future Bills —
ensure that we have a flexible framework in which to
make sure that Bermuda participates in what the f uture economy will look like.
And with that, Mr. Speaker, I move that the
Bill be read a second time and committed.
1950 27 April 2018 Official Hansard Report

Bermuda House of Assembly The Speaker: Any objections to that? No?
Mr. Deputy [Speaker], would you like to assume the chair?

House in Committee at 5: 12 pm

[Hon. Derrick V. Burgess, Sr., Chairman]

COMMITTEE ON B ILL

COMPANIES AND LIMITED LIABILITY COMPANY
(INITIAL COIN OFFERING) AMENDMENT ACT 2018

Honourable Members, we are now in
Committee of the whole [House] for further consider ation of the Bill entitled
Companies and Limited Liability
Company (Initial Coin Offer ing) Amendment Act 2018 .
Mr. Premier, you have the floor.
Hon. E. David Burt: Thank you very much, Mr.
Chairman.
Mr. Chairman, as we are now in Committee of
the whole, I wish to move clauses 1, 2, and 3.

Any objections to moving clauses 1
through 3?
No objections.
Continue, Mr. Premier.
Hon. E. David Burt: Thank you very much, Mr.
Chairman. As was indicated in the general debate,
there are without question amendments —a number of
amendments to clauses 4, 11, and 14, which I believe have been circulated to all Members.
Thank you very much. Mr. Chairman.
Clause 1 provides that this Bill shall be cited
as the Companies and Limited Liability Company (In itial Coin Offering) Amendment Act 2018.
Clause 2 amends section 2 of the Companies
Act 1981 (the “Companies Act”) to insert new defin itions to aid in the interpretation of new provisions.
Clause 3 amends section 4A of the Companies Act to insert a new subsection (3A) to designate an Initial Coin Offering as a restricted business activity for which consent is required. Such consents may be
granted subject to conditions as the Minister respon-sible for Companies may consider appropriate.

Any objections to approving clauses 1
through 3? There appear to be none.
Approved.
[Motion carried: Clauses 1 through 3 passed.]

Hon. E. David Burt: Thank you very much, Mr.
Chairman.
Mr. Chairman, I will now move on to clause 4,
and I am going to read through . . . there are a number of amendments to clause 4. The document that . .
. both Members of the Opposition who are h andling
this Bill have the Brief that I have in front of me, Mr. Chairman, and I am just going to read through clause
4 which will reference the various amendments, if I may, Mr. Chairman.

AMENDMENTS TO CLAUSE 4

Hon. E. David Burt: Mr. Chairman, clause 4 inserts
new Part IIIA in the Companies Act setting forth new
sections 34A to 34P as follows:
Section 34A inserts definitions specifically for
the interpretation of this new Part IIIA.
The [amendment] reads:

“Clause 4 [is amended as follows:]

“(a) in section 34A” (which is the definition of
distributed ledger technology) “by inserting in the appropriate alphabetical order the following: ‘distributive
ledger technology’ means a database [system] in
which —
“(a) information is recorded and consensually
shared and synchronized across a network or multiple nodes; and
“(b) all copies of the database are regarded as
equally authentic.’”

“(b) [by inserting after section 34A the follo wing—
“Restriction on issuing Initial Coin Offering.
“34B Subject to the provisions of [section] 4A, no persons shall issue an Initial Coin
Offering in or from within Bermuda unless that person is a company to which this Act
applies and is for the time being registered
with the Registrar of Companies in this Act.”

“(c) by ren umbering the remaining provisions
and” the various cross references.

Section 34C, as renumbered, requires a company that receives consent to offer digital assets to
the public publish an ICO offer document in electronic
form on the ICO platform and to f ile such offer doc ument with the Registrar of Companies. That filing must be accompanied by a certification from an attorney or officer of the company stating that it complies with
applicable statutory requirements for the ICO offer


Bermuda House of Assembly documents. Each of the directors or promoters who
fail to comply with this provision shall be liable to civil
penalties.
Section 34D, as renumbered, provides a list of
required information that must be included in the ICO offer document or other requisite accompanying document ation. Such pertinent particulars include, but are
limited to, the name and address of the registered office of the promoters, a description of the project and
the proposed timeline for the project, the amount of
money that the ICO is intending to raise, r ights and
restrictions attached to the digital assets on offer, the
opening and closing date of the offer, a statement as
to how personal information will be used, and a general risk warning.
Section 34E, as renumbered, requires any
company that offers di gital assets to the public to update their offering document with supplementary pr ovisions as soon as reasonably practical. If the details
in the ICO offer document cease to be accurate, fai lure to comply with this section attracts a civil penalty.
Secti on 34F, as renumbered, requires the
promoter to provide an electronic facility for communication regarding the ICO by participants and the company or other service providers. This section also pr ovides a three- day time frame within which a person
may withdraw from the ICO together with requir ements for specific instructions and means for wit hdrawal.
Mr. Chairman, in [amendment] 1(d), amends
the renumbered 34F(1)(a), by deleting the words “ICO
offer document” where they appear the second time
and substitut ing the words “ICO platform.”
Section 34G, as renumbered, requires that a
general warning regarding risk to participants be
prominently displayed on the ICO offer platform at all
times.
Section 34H, as renumbered, requires a company to ensure that appropr iate measures are taken
with respect to identification and verification of the
identity of persons who participate in its ICO.
In section 34H, Mr. Chairman, we also have
[amendment] 1(e) and that reads “in the renumbered
section 34H(1), by inserting after the words ‘verific ation of’ the words ‘the identity of.’
We will now move on to section 34I, as r enumbered, Mr. Chairman, which requires the promoter
to ensure that appropriate mechanisms are in place
with respect to the security of issued digital assets,
confidentiality, disclosure of information, and any ot her concerned matters. It also requires the promoter to comply with applicable Bermuda laws in this respect.
Section 34J, as renumbered, provides for offences relating to the issue of an ICO offer docu ment.
[Amendment] 1(f) in the attached sheet amends the
renumbered 34J by substituting a new provision. [Amendment 1](f) deletes the renumbered section 34J
and substitutes it with the following:
“Offences relating to the issue of an Initial Coin Offering
“34J (1) Any person who
“(a) contravenes section 34B; or
“(b) who makes or authorizes the making
of an untrue statement in an ICO offer
document unless he proves either that the
statement was immaterial or that at the
time he made the statement he had reasonable grounds to believe it was true,
“commits an offence.

“(2) A person convicted of an offence under
subsection (1), shall be liable—
“(a) on summary conviction, to a fine not exceeding $50,000 or to imprisonment for
a period of one year or to both such fine
and imprisonment;
“(b) on conviction on indictment, to a fine
not exceeding $250,000 or imprisonment
for a period of five years or to both such f ine and imprisonment.”
Moving on to section 34K, Mr. Chairman. Se ction 34K, as renumbered, provides for circumstances
under which persons may be civilly liable to ICO participants.
[Amendment] 1(g) amends clause 4, renumbered to [section] 34K(2)(c). In [section] 34K(2)(c), Mr.
Chairman, we are inserting . . . we are moving to
amend section 34[K](2)(c ) by inserting after the words
“any issue” the words “of digital assets.”
Mr. Chairman, section 34L, as renumbered,
provides exceptions from liability for experts.
Section 34M, as renumbered, provides that
the Minister make regulations for the purposes of this
new Part IIIA.
Section 34N, as renumbered, provides for the
issuance of a code of conduct by the Minister in co nsultation with the FinTech Advisory Committee with respect to initial coin offerings. The code of conduct is
intended to provide guidance on requirements and
principles to be observed by persons in the conduct of
an ICO.
[Amendment] 1(h), Mr. Chairman, amends
clause 4 of the renumbered 34N. And in that we are looking to amend the renumbered 34N by deleting the
word “shall” and substituti ng the word “may.”
Mr. Chairman, those are the . . . that is clause
4 with the requisite amendments, and I move that
clause 4 . . . I move that the amendments to clause 4
be approved.

Thank you and, first of all, the
Premier was not in the Chamber when I spoke.
1952 27 April 2018 Official Hansard Report

Bermuda House of Assembly Sir, I would like to say thank you for providing
me with your brief. I appreciate it and for accomm odating our request to meet.
I have a comm ent on [clause 4, new section]
34A(1), the definition of “digital assets.”
The concern is that it might actually catch
things that are not ICOs, and the definition has some
undefined terms that might result in uncertainty when
an application is made.
So, say I want to start up an IT company and I
am not going to create a Bermuda company, if it is unclear whether the product that I am going to be sel ling, if my business model that I am using is adopting a
digital asset that requires compliance with the IC O. So
does this definition apply to like iTunes cards? Just
asking, because they are a medium of exchange, and
if they were offering iTunes cards using blockchain
technology, would they be caught by 34A(1)(c), I think
. . . sorry . . .

Yes, thank you, Mr.
Chairman, I was trying to make it easier for the Premier by sort of doing this one at a time.
The question I have actually is on page 3 of —
this is the tabled document —I think it is probably pretty close. Let us see . . . it is under the definition of
“digital assets.” So, it is 34A, digital asset . . . 34A a
digital asset, it is (b) there, and it says . . . it includes
under the umbrella of digital asset “means anything that exists in binary format [and] comes with the right
to use it and includes a digital representation of value
that—” and it is letter (b) which I am interested in. It
says, “is intended to represent assets such as debt or
equity in the promoter.”
I am sure there must have been some disc ussion on this particular one. A lot of jurisdictions bas ically will segment ICOs into those that are actually
providing ownership or debt in the company versus
those that are providing a commodity like a product, or
use, or a subscription of some sort. We have included
here debt or equity, and I am just curious as to what the rationale was here, because I know other jurisdi ctions have excluded that.
The US has been particularly pointed about
anything which is trying to raise capital which repr esents where an ICO or a coin or a token actually re presents debt or equity be excluded. And I just wanted
to get a sense of what the Honourable Member ’s pe rspective was on that. Thank you.

[Clause 4, new section]
34B(2) says, “It is not necessary to file an ICO offer
document under subsection (1), at any time or in any
circumstances, where — [(a)] the digital assets are
listed on an appointed stock exchange—

POINT OF CLARIFICATION

Hon. E. David Burt: Point of clarification, please. Can
you repeat . . . Mr. Chairman, I just want to find the
section he is speaking to.

You have the floor, Mr. Premier.

Hon. E. David Burt: Thank you very much, Mr.
Chairman. I will begin to start to answer the questions.
The first question that was asked was from
the Honourable Deputy Leader of the Opposition who
asked a question regarding something about iTunes
cards or if they are building assets or all the rest. The
fact is that this only applies to things which are offered
to the public. The question about iTunes cards are specifically addressed down in the next section in (e)
and (f) which state: does not include a digital repr esentation of value issued by or on behalf of the publisher and used within an online game, game platform,
or family of games or cannot be taken or exchanged
with the person for legal tender. So, that sets to carve out those types of things for iTunes cards, et cetera.
More specifically to the broader question
which was asked about the definition of “digital as-sets” and things which may be brought, I think it is
important to realise that it says that anything that exists in bina ry format and comes with the right to use it
and a digital representation of that value. So the i nstance which you are talking about —about a computBermuda House of Assembly er that someone programmed and putting that toget her—you are not offering said digital asset to someone
else from that perspective.
The question which came from the Honour able Grant Gibbons regarding section 34A(b) which
spoke about the issue of intended to represent assets
such as debt or equity in the promoter. I think during
the general debate we made it ver y clear that unlike
other jurisdictions that may treat things separately as
securities and otherwise and different things because
there is coin offerings, utility tokens, securitised t okens, et cetera, we are having a broad umbrella piece
of legislation that is flexible, that allows us to apply the
appropriate scrutiny out to all the rest.
What we are finding in this world— which I
think, with the education of which we are getting as
we travel to learn more about this particular item —is
that utility tokens being the first thing are those things
which do not actually represent a claim on debt and/or
assets. But where we are merging to now is sec uritised tokens. And in order to make sure that we can
govern securitised tokens we have to make sure that
our legis lation makes allowance for that.
So we are not trying to legislate for the past.
We are trying to legislate for the future. What Dr. Gi bbons is talking about is how certain companies, or
countries, such as the United States and the Secur ities and Exchange Commission, or the Commodity
Futures Trading Commission or otherwise, have spe-cific definitions on the use of virtual currencies and
digital assets and how they are used. What we are
saying in this particular issue is, unlike the other juri sdictions, we are going to have one Act which governs
all which will be flexible enough to say that if you want
to issue an ICO for just a utility token you can do that.
If you want to use the Bermuda platform for the iss uing of a digital asset in order to represent equi ty or
debt, insofar as raising capital for your project, you can do that as well, with the protections underneath
this Act.
So, other countries where they have no regulation . . . then you will see inside the United States
where the SEC is saying, Well yo u cannot do that because that is a security , what we are saying is we are
broadly defining all of these particular items to fall under it. And the flexibility with the conditions which can be set by the Minister underneath the Act allow us to
be flexible t o allow all the different types of things
which may be happening now or different things which
may be coming as this industry is increasing, is modernising, very quickly.
The next question, I think, was on Initial Coin
Offering. I think that was from the Deputy Leader of
the Opposition as well, who says . . . “means an offer
by a company to the public to purchase or otherwise
acquire digital assets.” I think that might be legal speak to make sure you catch it all. So, if it purchased, or otherwise, or exchanged—just to make sure that you lawyers do this stuff incredibly well, and
I did have . . . okay.
I think it was a question from the Honourable
Member for constituency 8, the Honourable Member
Mr. Cole Simons who had asked about 34B(2). And it
said it is not necessary to file an ICO document under
subsection (1) anytime there are circumstances where
the digital assets are listed on an appointed stock ex-change. The reference to an appointed stock exchange is made in clause 2, which we did before.

The Cha irman: Any further speakers?
The Chair recognises the Honourable Member Leah Scott.

Okay. What does “of the same
class” mean in relation to digital assets?
Could I avoid the legislation by giving away
one token of insignificant value to anyone who visits a
certain website, like a cookie, and then when that person visits the offering site to buy tokens they already
have a digital asset of the same class which ultimately
allows me to avoid the ICO legislation?
[Section] 34A(4)(c) —can you explain what an
offer . . . “having a private character” is? What is “a
private character”?
[Section] 34A(4)(d) —why do we have this exception and what is the exception intended to catch?
Hon. E. David Burt: Stop there.

Stop there? Okay.

Hon. E. David Burt: While I wait for some answers to
the questions.
While I wait for some answers to questions,
allow me to go on the second question which was
1954 27 April 2018 Official Hansard Report

Bermuda House of Assembly posed by the Honourable Member , and that was an
offer having “a private character.” Again, I think it was
stated that if they are not offering it to the public, if it is
just, you know, all the rest, then that is the issue of the
document. So, if you are not offering it to the public, like someone may be doing, a capital raise via digital
assets on a private placement basis where they may
come to family offices such as the ones that you represent to raise the money there.
So, it is not something that is going out to . . .
it is not something that is going out to the public and,
so, the protections that are there.
The question about section 34[A](2) shall not
be taken as requiring any Initial Coin Offering or inv itation to be treated as made by the public if an offer
by the promoter to existing holders of digital ass ets in
the same class of digital assets complies as the office.
[Pause and crosstalk]
Hon. E. David Burt: The final question was in section
[34A(4)(d)], it says shall not be treated if “an offer certified in writing by an officer of the company on behal f
of the board of directors to be an offer which the board
considers as not being calculated to result, directly or
indirectly, in digital assets becoming available to persons other than persons whose ordinary business i nvolves the acquisition, disposal or holding of digital
assets, whether as principal or agent.”
I will seek clarification on that before I give an
incorrect answer. I am relatively certain I know what it
is because we have to remember there is a difference
between, you know, offers to the p ublic and offers in
the exact same thing when we are talking about on a
closed basis. And as we know what is going to be
happening with the virtual, sorry, with the Act that is
going to be coming from the BMA which is actually
going to regulate companies t hat provide ICO services. There will be people who provide ICO services specifically as opposed to things that are going out to
public.
So, the purpose of this for the public prov isions are to protect consumers, to protect those persons who may be going and doing things in the public
as opposed to professional institutional investors, br oker dealers, et cetera, who will be doing some of the
private placements for these particular digital assets.
And I will stand by for more questions to
come, answers to c ome. Any other? Okay. I nailed it
apparently.

[Laughter]

Okay. [Section] 34C(1), the “Co ntents of an ICO [offer] document.” Just in terms of the
information that is required, why is there no request for or no requirement for any financial information to
be provided? [Subsections] (a) and (b) refer to the promoters, but (c) refers to the company. So, should
(a) and (b) also include the word—

[Inaudible interjection]

Yes.

Hon. E. David Burt: —allow these particular items.
The first question was in regard to whether or
not subsections (a) and (b) of 34C(1) should have the
company reference in them. The answer to the question is no. The reason why it is the regi stered office or
principal office of the promoters, the name, description
of the promoters and the business or the proposed
business of the company. So, these people are pr omoting it which may or may not be the company —it
could be an individual —but then th ere is the name of
the business or company there.
Regarding the question about financial information and why that is not included in there . . . I do
believe that financial information is required in [sub-section] (f).



Bermuda House of Assembly [Inaudible interjections]

The Chai rman: Oh, I am sorry. The Chair will recognise the Honourable Member Grant Gibbons.

Thank you, Mr. Chai rman.
I am on page 4 and I will try and stick to the
red-lined version. It is 34A(4)(b)(ii) . This is the section
which basic ally exempts as being made to the public if
in this particular case, in the case an exempted company or permit company to more than 35 persons.
I guess the question I have for you is . . . obviously, we would like to do everything we can to have some sort of physical presence here with these companies. And I know it is in the Companies Act, and this
has been taken from Part III of the Companies Act. It
just seemed to me that including a permit company
here, where they are not even basically here, they are
somewhere else and they are using Bermuda . . . in
fact, one of your colleagues earlier on, the Honourable Member Mr. Commissiong, was belabouring the permit companies that are using Bermuda’s good reput ation.
It just seemed to me that including a permit
company here, although I know it is a wider ambit, may be something you wish to exclude for the simple reason that I think what you really want to do is make
these companies have as close an attachment to
Bermuda as possible. And I think this may give you
what I will call a bigger problem in the future, given the
issues we have discussed over the last couple of
years on permit companies here.
The other area that I was interested in is . . .
and I am going to flip over to 34C (it is now 34D) and
this is th e area which talks about the contents of an
ICO offer document. One of the questions that I had is in the Companies Act Part III. There are a couple of
sections which have been dropped. One is 27(1)(c) in
the Companies Act, where the document is asked to
give the minimum subscription that the promoter i ntends to raise. Okay? That has been dropped. And the
other, which I think is also a useful thing here in terms of information is 28(1), which is what is known as the
use of funds. What will the funds that ar e being raised
be used for? And in a prospectus, or whatever, that is
part of the requirement. It just seems to me that those
are two useful pieces of information.
So, I will leave it there, Mr. Chairman.

Any further questions?
Mr. Premier?

Hon. E. David Burt: I will try to tackle those two. The
first one in the reordered section that the Honourable
Member raised regarding permit companies, the question he raised is an interesting one and one which I
will take under advisement and further review. Regarding the issue of why those particular
sections were dropped, from my knowledge of that, it
was something that was not considered to be necessary here. We do know what the funds are going to be
used for. The funds are going to be used for the pla tform as spelled out in the White Paper document.
White paper documents basically talk about what the
company is going to do, and it is for the development
of the platform. If they are utility tokens, they will be
able to be used on the platform.
The best example, or the most recent example, that I can give is the company that was here t oday, Binance. They issue utility tokens that can only
be used on their platform, and those tokens can be
used to pay for trading fees on their particular platform. So these capital raises are raised for things to
be used inside of the platform for utility tokens. Ho wever, inside of this capital raised, the white paper ba-sically spells out what the funds will be used for.

Yes, thank you, and I
appreciate the Premier’s answer there.
Having done a couple of prospectuses myself,
I think one of the reasons I am raising that on the use
of funds is because certainly we know the funds will be going to develop the product or whatever else. O ften what is useful here in terms of what I will call r emoving those that are a little more fraudulent is, will those funds be used to hire people? Will they be used for, you know, software developm ent? Will they be
used to buy a boat, you know, for the promoter? I am being a little facetious here, but I think having a little
bit more information on where those funds will be actually allocated . . . it may be considered bureaucratic
but it does give both the, Minister who is going to have
to consent to this, and also the FinTech Advisory Committee, a little bit more data on whether this is (I
will say) frivolous, or whether this is somebody who
has really thought through how, let us say, if they are
trying to raise $1 million, how that $1 million will be
spent and whether it looks like it is going to be all ocated to stuff which is real as opposed to stuff which may be trips to Brazil for the promoter. Thank you.

Oh, sorry.

Hon. E. David Burt: Mr. Chairman, if the Opposition
would please work with me and if we can go section
1956 27 April 2018 Official Hansard Report

Bermuda House of Assembly by section. Just so . . . so, I think we are now on and
we are going to go with original sections so, even
though Grant has got the revised sections, we are
going to go with original sections. I have both in front
of me, so it is fine. So i f you say you are going from
the original or the revised I am able to do both. Yes, I
am able to do both.
But from the original section . . . and I believe
there was the question of what the items would be used for. I think that would be . . . I think as I said before, inside of the actual White Paper , those are the
things of which those things are spelled out. And if you have read ICO white papers, they are reasonably
detailed, talking about the number of people that they
are looking to hire, looking at t he number of people
they have to do. But we also have to remember that
there are regulations that are going to be coming out
that will specify.
There is going to be a FinTech Advisory
Committee that is going to look at something. So, if we see something t hat is going to be composed of a
panel of experts that does not even anywhere near
pass the smell test, it is like go back. The one thing of
which we have to remember, that I want Honourable
Member s and also the listening public to recognise, is
that we re alise there are certain people who believe
that ICOs and these types of issuances are the wild,
Wild West. And guess what? In some places it is. The
one place where it will not be the wild, Wild West is in
Bermuda.
We will have a committee that will vet t hese
items and if there is something that is not going to pass the smell test, we are not going to do it. And the particular reason why that is so is that we are not g oing to be the ones who are going to put our global
economy at risk, or our local economy and our international economy at risk. So those are the things which will be . . . without question, that will be analysed by the advisory group. Thank you.

Original, thank you. Sorry about
that.
So, section 34D, companies offering digital
assets to the public, and section 34D(1)(a) says “pu blish supplementary particulars disclosing the material
changes.” What is published? It is published in the
official Gazette ? Can you stick it on the website? Can
you walk around with a sign? What do you mean by publish?
Section 34D(2), should you include the word
“promoter” in addition to the company?
[Section] 34E —
[Inaudible inter jections] Ms. Leah K. Scott: Sorry. Oh, okay.

Mr. Premier?
Hon. E. David Burt: I am good, but I am not that
good right now.
On 34D the question about, she said, publish
and what does publish mean? I do not believe there is
a necessary definition of publish, but I think there is
probably a common law definition for publish. And so,
we are looking here and it says, “publish supplemen-tary particulars disclosing the material changes.” My
assumption would be, and this is just —and they will
correct me if I am wrong —is if they are doing an ICO
offer document, for instance, and there was an up-date, then you would publish it in the same manner
that you published it before.

Okay.
Just going back to the publish, usually in the
Companies Act if you are going to publish something it will say it should be published in the official Gazette .
So, I guess that is my question . Does it have to be
published in an official Gazette , or where do you publish it? If you publish . . . if you are making changes,
are you publishing it to the Registrar of Companies?
Who are you publishing . . . are you publishing it to whoever the partic ipants are? Who are you publishing
it to?

Mr. Premier?

Hon. E. David Burt: (It is the same answer I gave
before?)
I am being advised by the technical officers
that it is the same answer that I gave before regarding
that publish is a common law . . . there is just understanding . . . publish, and it would be in the same
method of which was done. And the issue here on
34D is that, as you will note, it will be on the site or the
offer platform which was filed with the ROC. So, in this whole iss ue there is going to be an offer platform with
the ROC where the ICO documents will be published
and this will be published there.

Okay. In the title you refer to
“cooling- off rights,” and that seems to be related to the
application under 34E(2). What is an application?
And then 34E(3) refers to the withdrawal of an
application pursuant to subsection (1), but subsection
(1) does not talk about an application.
And then in 34E(1)(a), could I suggest that after the words “offer document” you insert the words
“and any supplementary particulars” just for clarific ation?

Hon. E. David Burt: Okay, so we are on the original
version on 34E.

Yes, right. 34E refers to “coolingoff rights” and these cooling- off rights, I guess, pertain
to an application in 34E(2), which says, “If a person in
relation to an Initial Coin Offering makes an applic ation pursuant to the Initial Coin Offering, the person
may withdraw the application within three business
days after the application is made.”
Subsection (1) does not talk about . . . it refers
to subsection (1). Clause 34E(3) refers back to 34E(1)
in respect of the application, but (1) does not talk
about an application. So do we need to insert some
wording there about talking about the application?
And then in 34E(1)(a) after the words “offer
document” I would suggest insert ing the words “and
any supplementary particulars .”
Hon. E. David Burt: Honourable Member . . . Mr.
Chairman, can I ask the Honourable Member just . . .
you are querying subsection (3) which says the wit hdrawal of an applicati on pursuant to subsection (1),
and you were saying there is no reference to an appl ication in subsection (1). I jus t want to make sure I understand your question.

[Inaudible interjections]
Hon. E. David Burt: And, if I may . . . that is helpful,
thank you, because in that very long list of amendments of which I just gave, I do believe the amendment to this section, w hich is [amendment] 1(d) . . .
and if we look at amendment (d), page 2, all the
amendments are . . . the amendments, if you look at
the sheet of amendments which have been circulated . . . yes.

[Inaudible interjections]

Hon. E. David Burt: We have copies . We can give
you one.

[Crosstalk]

Hon. E. David Burt: Can you stand by for one second?

[Pause]

DRAFTING ERROR IN 34E(3) CORRECTED

Hon. E. David Burt: It is good to see how democracy
works, Mr. Chairman.
If I may move to amend the clause as it is
originally written, 34E(3), and the amendment that I
would make (although the technical officers say this
can be made as a simple switch) . . . I just want to let them know . . . and I would ask that all House Members will accept that in subsection (3) of 34E we
change . . . it says “The withdrawal of an application
pursuant to subsection (1).” It should read “The wit hdrawal of an application pursuant to subsection (2).”
And I would ask that we can approve that
amendment.

Thank you, Mr.
Chairman.
Mr. Chairman, it is just that the Premier has
just created a little bit of confusion now, becaus e under the revised version the new 34F —which was the
old 34E —they have actually inserted through the ICO
platform, and (c) . . . sorry, clause 3 relating to that
speaks to the ICO platform pursuant to subsection (1).
1958 27 April 2018 Official Hansard Report

Bermuda House of Assembly And that is now in subsection (1) havi ng mentioned
through the ICO platform. So, I am just wondering
whether . . . it is just a little confusing to amend the
amendment.

Hon. E. David Burt: Just so we are clear, in here it
makes a reference to subsection (1) and it really should be just refer ring to subsection (2). So, we are
just changing the (1) to the (2).

[Inaudible interjections]

Hon. E. David Burt: Again, subsection (3) says wit hdrawal of an application—
[Inaudible interjections]
Hon. E. David Burt: And subsection (2) can only be
made by a method specified on the ICO platform and the ICO platform must include specific instructions
and a means to withdraw.
So, the Honourable Member caught a mistake
in drafting. That is the reason why we go through these things clause by clause
The Ch airman: Any objections to that approval?
No objections.
Approved.
[Motion carried: Drafting error at clause 4, new section
34E (3), corrected.]

[Inaudible interjection]
Hon. E. David Burt: Thank you, Honourable Member.

On 34E(1)(a), would you consider
adding the words “and any supplementary particulars”
after the words “offer document”, just because it is
kind of a catch- all phrase.

Hon. E. David Burt: Mr. Chairman, we are not i nclined to make that change at this time. But I am sure
the technical officers will take it under advisement.
They believe that it is broad enough.

The Chair man: Any further questions?
There appear to be none.
Mr. Premier?
[Inaudible interjections]

Okay. Thank you, Mr. Chairman.
I think we are almost done. So, 34G talks about the identification of persons in relation to the ICO, and “[( 1)] A company shall,
in relation to an Initial Coin Offering, ensure that it applies appropriate measures relating to identification
and verification of persons participating in the Initial Coin Offering.”
What are you identifying as appropriate
measures? Because I know that in other legislation it
sets out what you are required to do in terms of getting information— your CDD and your EDD and what
KYC you are going to require. So what . . . the challenge is that if we come in like . . . if the BMA comes
in for an on- site and they are going to say, Well, how
are you acquiring your KYC ? How do you know your
client ? What are the appropriate measures so that we
that are providing the service to anybody that does an
ICO can make sure that we are taking the right steps?

Hon. E. David Burt: Thank you, Mr. Chairman.
Mr. Chairman, subsection (2) in that same
clause states “For the purposes of subsection (1), the
Minister may make such regulations, subject to the negative resolution procedure, as he considers appropr iate.” So, regulations will be made for that.

Okay.

Hon. E. David Burt: Thank you very much, Mr.
Chairman.
This is a very extensive set of amendments to
clause 4. I appreciate the indulgence of the Oppos ition for these amendments and with that we have di scussed . . . the Opposition, I believ e, is satisfied with
clause 4, which is inserting this section 34A and . . .
sorry, the items under 34, so what I will ask, Mr.
Chairman, is that the amendments which have been
placed and circulated to all Members in addition to the amendment that we had p reviously approved for the
renumbering, the change from subsection (1) to su bsection (2), I would ask that the amendments be ap-proved.


Bermuda House of Assembly The Chairman: Any objections to the amendments
being approved?
No objections.
Approved.

[Motion carried: Amendments to clause 4 passed.]

Hon. E. David Burt: I move that clause 4, as amended, be part of the Bill.

[Clauses] 5 through 10. Continue.

Hon. E. David Burt: Thank you very much, Mr.
Chairman.
Clause 5 inserts a new Part (oh, dear —I am
just going to call it) XI VC into the Companies Act relating to the establishment of a FinTech Advisory Committee.
Clause 6 amends section 287A of the Companies Act by deleting the words “affirmative” and
substituting the word “negative” in relation to the Mi nister’s regulating pow er.
Clause 7 amends section 289 of the Companies Act to provide for savings provisions in relation to
laws governing securities, foreign exchange control,
or other applicable law.
Clause 8 amends the Ninth Schedule to the
Companies Act to include Initial C oin Offerings as a
restricted activity. That was clause 8.
Clause 9 . . . and I am just going in this area,
Mr. Chairman, but just the clauses before were
amendments to the Companies Act, now we are moving on to the amendments to the Limited Liability Company Act.
Clause 9, Mr. Chairman, amends section 2 of
the interpretation of Limited Liability Company Act [2016] [“LLC Act”] to insert new definitions for the pr oposed Part 10A.
Clause 10 inserts a new subsection (3A) in
section 67 of the LLC Act to include Initial Coin Offe rings as a restricted business activity for which the consent of the Minister is required under section 67.

Thank you, Mr. Chai rman, just a couple of questions. I am going to start with clause 5, which is the
FinTech Advisory Committee. I think we are under the
understanding that, obviously, the function here is fai rly broad—advise the Minister in any matter relating to FinTech or the development of FinTech industry.
Would it be fair to say that the FinTech Advisory
Committee is going to be the one that vets the ICO
applications before the Minister decides whether or
not to give their consent?
What will be the role of the Registrar of Companies in here? Are they going to be sort of doing a dual function here? Do they have any role in terms of
advising the Minister with respect to these applic ations that they fall more directly, I think, under the
Companies Act? So, that is sort of one question.
The next question that I have is actually
clause 6. I had a quick look at this, but this amends section 287A of the Companies Act, and this is, if I
understand it correctly, quite a reach. What this is doing is saying that any regul ations under the Companies Act will now be switched from affirmative resol ution to negative resolution, that includes anything in
the Companies Act. Is my understanding correct? And
is that not a bit of a reach here?
Are there not aspects of the Companies Act
which really require parliamentary oversight as opposed to simply passing through on a negative resol ution?
Thank you.

Any further speakers?
Mr. Premier?

Hon. E. David Burt: Thank you, Mr. Chairman.
Mr. Chairman, in regard to the question from
the Honourable Member on the first issue— yes, the
FinTech Advisory Committee will be the group that will
be the ones that are reviewing those items and to be
adding the . . . will be responsible for providing advice
to the Minister of Finance i n this particular issue.
There was a question as to what would the
Registrar of Companies be doing . . . the Registrar of
Companies during this . . . I do not want to say purely
administrative, but from the administering portion of this provision the issues insofar as the approval for these items, or the vetting of these items, will be with
the FinTech Advisory Committee which will more than
likely have a representative from the Registrar of
[Companies] on that particular matter.
The issue when it comes t o negative resol ution, Mr. Chairman, is that at this amendment to the
Companies Act we are making the provisions the
same as they are in the Limited Liability Company
Act—the Limited Liability Company Act 2016 which
was piloted through this House by none other than the
Honourable Member who asked the question.

Thank you, Mr.
Chairman.
Mr. Chairman, in light of the Premier’s r esponse in terms of the question from the Honourable
Member from [constituency] 22 on section 272F, the
FinTech Advisory Committee, since part of their functions will have the responsibility for vetting the applic ation process for ICOs, might it be useful to specify, as
opposed to leaving it as general, to say that, you
know, the responsibility of the FinTech Advisory Committee, whose primary function shall be to advise
the Minister on any matter relating to FinTech. But I
think we specifically want to know that there is som eone who can be held accountable for the vetting of the
applications in resp ect of the ICOs, and would it be
useful to, as opposed to just saying any matter which
the Minister may refer to it, could include words such
as “and shall have responsibility for vetting the appl ication process for ICOs” —would that be useful?

Hon. E. Dav id Burt: I thank the Member for her question.
The reason why it is there is for broad and
general. I understand we were talking about the var ious provisions. But I can assure you that the Minister
of Finance either present and/or future would not put the country at risk in attempting to try to look at these
things themselves. That is the purpose of the FinTech Advisory Committee, and why the FinTech Advisory Committee was written in there. But I recognise the
statement of which you are saying, and if there is an
opportunity to revisit this, if we want to make it more
specific, I will see if we can do that.
In regard to the question that was asked by
the Honourable Member Leah Scott, it would seem as
though the One Bermuda Alliance Government
thought that t here should be negative resolution po wers for the Government, the Companies Act, the LLC.
And we are taking this opportunity to make sure that both Acts mirror each other.

The Chair recognises the Honourable
Deputy . . . the Leader of the Opposition, Ms.
Atherden.

Hon. Jeanne J. Atherden: Mr. Chairman, in respect
to the statement that the Premier just made that he
was changing . . . I am talking about the amendment
to section 287A, and turning around and making this
negative resolution because it is in line with what is in
the Companies Act . . . I guess I want to ask the question . . . the Limited Liability Act. I guess I want to ask the question, recognising that we are using these
changes to reflect what we want to have with respect
to ICO s, and that is really what we should be looking
at regardless of which Act it is being put in to. I just
wondered, in other jurisdictions where I know there is
always a concern about . . . you have the FinTech
Advisory Committee to make sure that they are looking at things to make sure that it is properly done. In
other jurisdictions where you have seen the regul ations, has the Minister who is responsible for these
ICOs not had some sort of . . . not . . . I mean, by
making a negative resolution you effecti vely do not
allow, let us say, like the Parliament or whatever else,
to have any oversight. So, in other jurisdictions is that
the way that it has normally been done?

Hon. E. David Burt: Mr. Chairman, what I will say to
this is that I think Honourable Member s will recall that
the last time this House sat we tabled, I think, 22 negative resolutions. And what I will say is, Mr. Chairman,
and I am trying my best not to be nakedly political,
although as most people know that is in my nature.
There were many p oints in time where the party opposite did not submit items to Parliament’s scrutiny and we had to search on websites to see negative
resolutions which were passed.
The Attorney General and the statements of
the Cabinet Secretary made aware that any time there
is a negative resolution item that is passed it will be
tabled in this House because we have to follow the
law. That was not what they did. That is what we are
doing, and that is the commitment.
But it is not correct for the Opposition Leader
to say it does not have parliamentary oversight. Negative resolutions under the Interpretation Act, of course,
have parliamentary oversight. And any Member can
raise those issues or take up those issues at any point
in time. The commitment that I will give to Members is
that we will follow the law and we will table the negative resolutions. And you have seen that we have t abled all the backlog of negative resolutions, and we
will continue to bring negative resolutions to this
House in concert with as the law stat es.
[Desk thumping]
[Inaudible interjections]



Bermuda House of Assembly Hon. E. David Burt: Mr. Chairman, seeing no further
statements on clauses 5 through 10, I move that
clauses 5 through 10 be approved.

Carry on.

AMENDMENTS TO CLAUSE 11

Hon. E. David Burt: Mr. Chairman, it is my hope that
the amendments to clause 11 may go a little quicker
than the amendments to clause 4, as they are substantially similar to the amendments which were made
to clause 4 as they are substantially similar pos itions —one in the Companies Act and the other one in
the Limited Liability Company Act. But I will read
through them nonetheless, Mr. Chairman, as they
have to be read for the record. But all Members do
have the amendments to clause 11, which do start on
page 3 and go all the way through page 5.
Clause 11 inserts a new Part 10A into the LLC
Act relating to ICOs that offer digital assets. The new
sections 85A through O provide as follows:
Section 85A inserts definitions for the interpr etation of the new Part 10A.
And now, Mr. Chairman, regarding the
amendments which we have in front of us, [amendment] 2(a) amends section 85A by amending subsection (1), in the definition of “distributed ledger technology,” by deleting the word “ decentralised”; in subsection 4(b) by deleting the word “managers,” and subst ituting the word “members”; and in subsection 4(b) by deleting the word “board considers,” and substituting
the words “managers consider.”
[Amendment] 2(b) inserts a new section 85B
and the new section 85B is a move to amend clause
11 by inserting after section 85 the following: “R estriction on issuing Initial Coin Offering,” which will
read:
“85B Subject to the provisions of section 67,
no person shall issue an Initial Coin Offering
in or from within Bermuda unless that person
is a limited liability company to which this Act applies and for which is at the time being registered with the Registrar of Companies under
this Act.”

[Amendment] 2(c) is to renumber the remai ning provisions and references accordingly.
I will keep going through.
Section 85C, as renumbered, requires an LLC
that receives consent to offer digital assets to the pub-lic to publish an ICO offer document in the same manner as is required for a company.
There is [amendment] 2(d), Mr. Chairman,
which is in section 85C, and in the renumbered section 85C it is deleting subsection (5).
Section 85D, as renumbered, provides a list of
required information that must be included in the ICO
document.
[Amendment] 2(e) amends the renumbered
section 85D, and in the renumbered section 85D the
amendment is as follows:

“(i) in subsection (1), by deleting paragraph (f)
and substituting the following:

“(f) the disclosure as to the allocation of the amounts intended to be raised amongst the classes of any issuance (pre- sale,
post-Initial Coin Offering etc.);

“(ii) in subsection (2), by inserting after the words “prescr ibed by” the words “regulations
or.”

Section 85E, as renumbered, requires updates to the published ICO offer document if the details cease to be accurate. Failure to comply with this section attracts a civil penalty.
Section 85F, as renumbered, requir es a pr omoter to provide an electronic facility for communic ation regarding the ICO by participants and the compa-ny or other service providers. This section also pr ovides for withdrawal from the participation in the ICO.
Section 85G, as renumbered, provides r equirements relating to disclosure of a general risk
warning.
Section 85H, as renumbered, requires a li mited liability company to ensure that appropriate
measures are taken with respect to identification and verification of the identity of the persons who will participate in its ICO.
Mr. Chairman, amendment 2(f) which is located on page 4 of the sheet of amendments amends
clause 11, renumbered to 85H(1), and in the renumbered section 85H(1), by inserting the words “verific ation” . . . sorry, by insert ing after the words “verification
of” the words “the identity of.”
Section 85I, as renumbered, requires the
promoter to ensure that he has the appropriate mec hanisms in place with respect to security of issued dig ital assets, confidentiality, disclosure of information and any other connected matters. It also requires the
promoter to comply with applicable Bermuda laws in
this respect.
Section 85J, as renumbered, provides for offences relating to the issue of an ICO offer document .
[Amendment] (g) amends the renumbered
section 85J by substituting a new section 85J and
therefore in [amendment] (g) it reads as follows: It is
1962 27 April 2018 Official Hansard Report

Bermuda House of Assembly moved to amend deleting the renumbered section 85J
and substituting the following:
“Offences relating to the issue of an Initial
Coin O ffering
“85J (1) Any person who—
“(a) contravenes section 85B; or
“(b) makes or authorizes the making of an untrue statement in an ICO offer
document unless he proves either
that the statement was immaterial or
that at the time he made the stat ement he had reasonable grounds to
believe it was true,

“commits an offence.
“(2) A person convicted of an offence
under subsection (1), shall be liable —
“(a) on summary conviction, to a fine
not exceeding $50,000 or to impri sonment for a period of one year or to
both such fine and imprisonment;
“(b) on conviction on indictment, to a
fine not exceeding $250,000 or i mprisonment for a period of five years
or to both such fine and imprisonment."

Section 84K [sic], as renumbered, provides
the circumstances under whi ch a person may be civi lly liable to ICO participants.

Yes.
Hon. E. David Burt: Provides the circumstanc es under which persons may be civilly liable to ICO partic ipants.
[Amendment] 2(h) amends the renumbered
section 85K, and it states that in the renumbered sec-tion in subsection (1) it is requested to be amended by
deleting the word “can” and in subsection (2)(c), by
inserting after the words “any issue” the words “of digi-tal assets.”
Section 85L, as renumbered, provides exceptions from liability for experts .
Section 85M, as renumbered, provides the
issuance of a Code of Conduct by the Minister, in
consul tation with the FinTech Advisory Committee
with respect to Initial Coin Offerings.
And the final amendment in this clause, Mr.
Chairman, is [amendment] 2(i) which amends the r e-numbered section 85M, and in the renumbered section 85M it is moved to amend t his subsection . . . so rry, this section, by deleting subsection (4).

All right, Bat Man.

[Laughter]

Hon. E. David Burt: I will, Mr. Chairman, because the
keen- eyed lawyer that the Deputy Opposition Leader
is has —

[Laughter]

Hon. E. David Burt: She has been reading a whole
lot of trust documents, and what she is making sure
that takes place (as she stated) is that in the renumbered section 85F, subsection (3), it is additionally
moved to amend subsection (3) that says withdrawal
of an application pursuant to subsection (1) and to
change subsection (1) to subsection (2).

Thank you, Mr.
Chairman.
Mr. Chairman, I just wonder if the Honourable
Minister in respect of renumbered section 85J, on In itial Coin Offering on page 20 of the renumbered document . . . it has an (a) and a (b) basically talking
about the penalties on summary conviction or convi ction on indictment. [I ask] whether we might consi der
including a disqualification from further participation as a separate clause?
And the idea of that being that we believe that
this whole construct is so important to our reputation
that if somebody gets out there and they say, Okay,
got a summary conv iction, I will pay $50,000— which
is just a drop in the bucket. You know, I do not want to
go to jail but I could pay $250,000 because this is an
either or . But I think that if we have a further penali sing capacity to say that they will be precluded from
further participation in any form of ICO engagement,
then I think that this will sort of highlight the i mportance we place on making sure that our reputation


Bermuda House of Assembly remains pristine. I wonder whether the Minister would
consider that as an addition.

Mr. Premier.

Hon. E. David Burt: Thank you, Mr. Chairman. I will
answer both questions. I will answer the last question
first.
In the original 85G, the renumbered 85H,
subsec tion (2) says for the purposes of subsection (1)
the Minister shall make such regulations subject to the
negative resolution procedure as he considers appr opriate. Those items will be covered in the regulations.
And the first question, which was asked by , I
think, the Deputy Opposition Leader . . . oh no, sorry,
the Honourable Member for constituency 23, I will
take the specific recommendation under advisement
for any possible future amendments.
What I will say, however, is that of course the
Minister of Finance can refuse any additional consent.
I think that any Minister of Finance will be crazy to
possibly allow someone who has a conviction of possibly doing something fraudulent to an ICO to [then]
do another one. But I will take that under advisement as to something that could be clarified in law as well
because it may be something that may tighten up
things for any assessment. So, I appreciate that
comment.

Any objections to approving clause
11? There appear to be none.
Approved.
[Motion carried: Clause 11 passed as amended.]

Hon. E. David Burt: Thank you very much, Mr.
Chairman.
Mr. Chairman, I will now move on to clauses
12 and 13. I move that clauses 12 and 13 be approved and I will read the m. Thank you, Mr. Chai rman.
Clause 12 amends section 255 of the LLC Act
to extend the Minister’s regulation power in relation to
an application for consent to an ICO.
Clause 13 amends section 257 of the LLC Act
to provide for savings.

Any objections to the approval of
clauses 12 and 13?
There appear to be none.
Approved.
[Motion carried: Clause 12 and 13 passed.]

AMENDMENT TO CLAUSE 14
Hon. E. David Burt: Thank you very much, Mr.
Chairman. I will now ask that we now move to clause
14.
Clause 14 amends the Government Fees
Regulations 197 6 to provide for new fees in relation to
an ICO. And there is an [amendment] to this as well, a
motion to amend. And that motion which has been
circulated is saying that clause 14 is deleted and the
following is submitted.

“Amends Government Fee Regulati ons 1976

“14 The Government Fees Regulations 1976
are amended in the Schedule as follows —

“(a) in Head 16, by inserting after paragraph 39 the following—

39A Application by a company
under section 4A for consent of the Minister to an
ICO


$5,000
39B Filing an ICO offer doc ument under section 34C
$95

1964 27 April 2018 Official Hansard Report

Bermuda House of Assembly ” “(b) in Head 40, by inserting after paragraph
15 the following—

15A Application for consent of the
Minister under section 67 to
an ICO

$5,000
15B Filing an ICO offer document
under section 85C
$95

Thank you Mr.
Chairman.
Mr. Chairman, I am particularly mindful in this
particular clause. As I mentioned in the general debate we seem to be giving away the shop in terms of
the cost of registration. And I am looking at $5,000 as
a fee, and recognising that this probably accounts for
maybe two hours of civil servants’ time for three people, and then you are done. So the reality is . . . the
question is, can we really consider a fee that is far
more commensurate with the responsibility of
(a) protecting our jurisdiction; and (b) the work that
has to go into vetting and verifying these particular
applications and something that really makes it . . . I
would not say that it penalises anybody, but it just makes them recognise that we have to do our due
diligence on their applications.
It is going to take resources, and I think
$5,000 is basically giving away the shop. It is nowhere
near enough.

Thank you very much Mr.
Chairman.
Mr. Chairman, I note the comments from the
Honourable Member for the Opposition, and, as I
would say, as we continue to go through this process
if there are revisions that are needed to be made r egarding these fees, we shall so make them. And I accept the recommendations and the comments which were made and we will examine and adjust appropr iately.
Thank you very much. Mr. Chairman, I move
that clause 14 be approved.

Any objections to the approval of
clauses 15 and 16?
There appear to be none.
Approved.
[Motion carried: Clauses 15 and 16 passed.]
Hon. E. David Burt: Thank you very much, Mr.
Chairman. I move that the preamble be approved.

The Ch airman: Any objections to approving the pr eamble?
There appear to be none.
Approved.

Hon. E. David Burt: Thank you, Mr. Chairman.
I move that the Bill be reported to the House
as amended.

It has been moved that the Bill be
reported to the House as printed—as amended, sorry.
Is there any objection to that?
None.

Hon. E. David Burt: Thank you, Mr. Chairman.

[Motion carried: The Companies and Limited Liability
Company (Initial Coin Offering) Amendment Act 2018
was considered by a Commit tee of the whole House
and passed with amendments.]

House resumed at 6:35 pm
[Hon. Dennis P. Lister, Jr., Speaker, in the Chair]

REPORT OF COMMITTEE


B ermuda House of Assembly COMPANIES AND LIMITED LIABILITY COMPANY
(INITIAL COIN OFFERING) AMENDMENT ACT 2018

Good evening, Members.
Are there any objections to the Bill entitled t he
Companies and Limited Liability Company (Initial Coin
Offering) Amendment Act 2018 being reported to the
House as amended?
No objections. So moved.
I believe that brings us to the end of the O rders of the day. Yes?
Third readings.
SUSPENSION OF STANDING ORDER 21
Hon. Wayne L. Furbert: Thank you, Mr. Speaker.
I move that Standing Order 21 be suspended
to enable me to move that the Bill entitled the Compa-nies Amendment Act 2018 be now read for the third
time by its title only.

Mr. Speaker, I rise this
morning . . . I rise this evening— it is evening, it has
been a long day. I rise this evening on what I would
call a bittersweet note. This will be my last sitting of
the House. I will be forwarding my formal resignation
as an MP to you, Mr. Speaker, effective the 30th of
April—Monday.

This is my 25
th year as a
parliamentarian. And I can say that I have enjoyed
every one of them —although I must admit there are
some years that I have enjoyed more than others.
It has been a privilege to carry out the people’s business. I would particularly like to thank the
constituents of Paget East for their continuing trust
and support over the l ast 24 years. I have enjoyed
advocating on their behalf and assisting them with
everything from pensions and roadworks to dog i ssues. I hope they feel that I have served them well
and made a positive contribution to Bermuda during
my time as an elected Mem ber.
A few colleagues may recall that I started my
time as a parliamentary member in the Senate, the other place, following the general election in 1993. I
was subsequently elected to represent Paget East in
the July 1994 bye- election, and became Sir John
Swan’s running mate under the dual constituencies that were in place at the time.
Premier Swan appointed me to Cabinet in
January of 1994 to manage the portfolio of Management and Technology. I remember, Mr. Speaker, my
first piece of legislation— an amendment to the O bscene Publications Act. Hardly an auspicious start, but the first of many more significant pieces of legislation I
introduced as a Cabinet Minister over the years.
Looking back, Mr. Speaker, I believe I had the
privilege of being directly involved in many positive
social and economic advancements in Bermuda. I do not have the time to speak about all of them tonight,
but I hope you will indulge me to mention a few of
them.
Under Sir John I led the bases transition effort
starting in 1994, w ith the departure of the US Navy
and the return of the US base lands to Bermuda. Fol-lowing negotiations, as some Members may recall, with the US Navy, Congress, and the Pentagon, the
airport and its operations were transferred successful-ly to Bermuda in 15 months. The base lands project
involved a thorough legal and environmental study,
the formation of the Bermuda Land Development Corporation, and a reuse plan for the return of roughly
10 per cent of Bermuda’s land area.
As Minister responsible for telec ommunic ations I initiated the deregulation of the monopoly -
controlled telecom sector in June of 1995 paving the way for the entry of competition and the dramatic lo wering of long distance phone charges which saved residents and businesses tens of millions of dollars in
fees over succeeding years.
In 1996, as Minister of Finance, I had the
privilege of hosting and co- chairing the Commonwealth Finance Ministers meeting with UK Chancellor Kenneth Clarke
. This was actually the seventh and
last time the meeting was held in Bermuda.
During the 1990s it was clear that Bermuda’s
pension provisions were inadequate to meet the
needs of our retirees. I had responsibility for developing and piloting the Bermuda’s National Occupational
Pensions legislation through Par liament in 1998. This
landmark legislation provided the basis for our current
pension system which ensures that Bermudians have
a solid financial nest egg for retirement, and it r emoved, as Honourable Member s will know, the need
to rely solely on social in surance benefits for retir ement.
More recently, Mr. Speaker, as Minister of
Economic Development in the OBA Government, I
was proud to have contributed to the economic revitalisation of Bermuda that was so desperately needed, in
2012. One of the first steps was establishing the Cabinet committee on Economic Development which faci litated significant tourism investment and infrastructure
development over the last five years.
In April of 2013 we achieved the successful
transfer of the satellite EchoStar 6 in to Bermuda’s orbital slot just days before the expiration of Bermuda’s rights to the slot. After many years of frustration and
disappointment, this was a key step in Bermuda’s . . .
that was actually begun by Dr. John Stubbs in the
1980s to enable Bermuda to benefit commercially
from the space sector.
Following the launch of the Regulatory A uthority in January of 2013 the Ministry of Economic
Development introduced the 2015 Electricity National
Policy followed by the Electricity Act in 2016. This key
legislation enabled, after more than a century, competition in the electricity sector and opened the door to the broader use of renewables and potentially less costly, cleaner and more secure energy sources for
the Island. As part of this effort I initiated the first utility
scale solar PV tender for the unused land at the ai rport Finger which, in its initial phase, I hope will pr ovide up to 6 per cent of Bermuda’s peak load at a
much lower cost than fossil fuels.
Mr. Speaker, the Ministry of Economic Development was responsible for the Personal Information


Bermuda House of Assembly Protection Act of 2016 which, when brought into force,
will provide privacy and much- needed protection for
Bermuda’s residents’ personal information.
I was also pleased to introduce the Limited
Liability Co mpany Act 2016, the first new corporate
vehicle in Bermuda in more than 100 years that will
provide a flexible and attractive corporate framework
for local and international business firms.
Finally, Mr. Speaker, I was incredibly proud to
have led the Berm uda bid team that successfully
brought the 35th America’s Cup to Bermuda, and the
superb team that delivered such a successful event.
Hosting AC35 put Bermuda on the world
stage, created hundreds of jobs, helped to rejuvenate
tourism and jump- started Ber muda’s struggling economy by adding over $330 million to Bermuda’s GDP . It
also demonstrated, Mr. Speaker, the remarkable abi lity to rai se Bermuda to the occasion and work toget her to achieve extraordinary results.
So now, Mr. Speaker, as my political to -do list
comes to an end, let me briefly comment on what I
have observed during my time in Parliament.
There have been many changes over the past
few years —some for the better and some for the
worst. Perhaps it is less obvious to new Members, but I believ e that in the last few years the tone of debate
and personal conduct have deteriorated. Unfortunat ely, Bermuda is not alone in the degradation of political discourse. We have only to look to our neighbour to
the west to see divisiveness and bad behaviour
demonstrated on almost a daily basis.
Perhaps this has been exacerbated by unre gulated social media and the ability of bad actors to
disrupt democratic systems, something that Gover nment and the community may have to address more effectively. But in Bermuda this is particularly unfort unate, because parliamentarians who are leaders and
role models in our community set the tone for the rest
of the Island. A deteriorating tone in Parliament undermines the public credibility and makes it more diff icult to find new candidates for political office—
something we clearly need. Younger Bermudians, particularly those with established careers, will feel they have better options than to deal with the socalled cut and thrust on the Hill.
Finally, given the serious iss ues Bermuda will
continue to face as a small community with a fragile
economy, we need more cooperation and far less partisan rancour.
Let me end, Mr. Speaker, by saying it is not
often that one gets to leave an elected position on one’s own terms. So again, I would like to express my appreciation to my constituents in Paget East for their
support through many elections. But it is time to go.
It is time to make way for new blood, som eone who is prepared to make the commitment, who
can bring substance and passion, and who will have
Paget [East] and Bermuda’s best interests at heart.
Before any Honourable Member s or political commen-tators outside these walls try to twist my resignation
into something it is not for political purposes, let me
confirm that I r emain a member and supporter of the
One Bermuda Alliance and what it stands for. I will
remain a member of the One Bermuda Alliance, a lthough recent unanticipated events may now influence the impact of my decision on public opinion.
I can assure Honourabl e Member s in this
House and the public that my decisions to retire from
politics , and then when to retire from politics , were
made long ago. I look forward to continuing my fam ily’s legacy of public service—just not as an elected Member.
So let me thank m y party colleagues, both
past and present, for their friendship, counsel, and support. I would also like to extend my sincere appr eciation to the many capable civil servants that I have
had the pleasure of working with over the years. Let
me thank my fello w parliamentarians for their collegiality.
Finally, and most importantly, I am indebted to
my own family for their unstinted support —particularly
my wife, Kathy, my partner in this exercise, who has been a tremendous resource and confidant throughout the political highs and lows, and my two sons who
have had to put up with a semi -absent father for many
years. It has been an extraordinary experience.
Thank you all.

[Desk thumping]

Thank you. Thank you, Honourable
Member , and we do recognis e that the service in this
House comes with both good and bad— and you have
given long service to the country and we honourably
accept your resignation.
We now recognise the Honourable Member
from constituency 10, the Honourable Member
Dunkley. You have th e floor.

Hon. Michael H. Dunkley: Thank you, Mr. Speaker .
Mr. Speaker, that is a tough act to follow. I
have to say that I am not surprised at the retirement,
but certainly surprised at the timing of the announc ement.
Dr. Gibbons has served in this legislature for
25 years, since January of 1994, with distinction. So, it
is no surprise after such tireless service that he might
want to step down. In fact, Mr. Speaker, there was a
bit of arm twisting for Dr. Gibbons to run at the last election in July of last year.
For as long as I have known Dr. Gibbons, Mr.
Speaker, he has been a man of a tireless work ethic. I
have always found him to be prepared, calm, cool ,
and collected. And, Mr. Speaker, in recent years he
has also developed somewhat of a sense of humo ur,
which I think we have seen on the House of Asse mbly. So I guess it shows if you serve a long time you
1968 27 April 2018 Official Hansard Report

Bermuda House of Assembly can develop a sense of humour. And maybe that is
what politics does to you.
No doubt , Mr. Speaker , Dr. Gibbons is one of
the most accomplished people ever to serve in this
Honourable Chamber earning a Bachelor of Science
from Brown in 19 74. H e attended Oxford as a Rhodes
Scholar from 1974 to 1976 and was awarded a M aster
of Arts in philosophy, politics , and economics. He
studied organic chemistry at Harvard (whatever that
is, Mr. Speaker ), for which he received a PhD in 1982,
and then s erved as a teaching Fellow during that per iod of 1976 to 19 81 and 19 81 to 1982.
He came to this House of Assembly after r eturning to serve in the numerous business es that the
family had. And, certainly, Mr. Speaker, Dr. Gibbons
gave an outline of his service starting in 1994 when he
was appointed to the Senate and then became a
Member of the House of Assembly with the byeelection. He continued to get elected in Paget East
through the years. And following the 1998 election in
2001 he became the Leader of the Opposition for about five years. Also at that time he was Chairman of
the Public Accounts Committee, which we know the
Minister of Finance normally takes over.
Mr. Speaker, I have always found Dr. Gibbons
to be a man who gives it his all. In the Cabinet that I served in, and then became the Premier, I found Dr. Gibbons to be perhaps the most effective Minister of
Education that we ever had. And he was an excellen t
Minister of Economic Development.
Dr. Gibbons had direct responsibility, as he
said, for the America’s Cup. And no doubt his excellent work and guidance, Mr. Speaker, played a large
part in exceeding every expectation we had, and coming in under budget.
In addition to his stellar political career, there
is no doubt that Dr. Gibbons has had a tremendous
success in family business and in the community work
that he has done.
Mr. Speaker, it has been an honour for me to
have known Dr. Gibbons and his family for many,
many years. And it has been a pleasure to serve with
him since 1998. During our time together in service, I have many fond memories of working with a true gentleman . . . a true gentleman, Mr. Speaker, who I
served with, I served under, and then had the pleasure of sitting in Cabinet with.
Mr. Speaker, I think many will agree that Dr.
Gibbons was not your natural politician. But he ded icated 25 years of service to our beautiful Island; service which, no doubt, helped immensely in so many
ways. He was excellent. He excelled in everything he
did from the start as the Minister of Management and
Technology through to the Minister of Finance. The
base transition, to which Dr. Gibbons referred briefly,
was a tremendous challenge we faced in the mid- to
late 1990s and Dr. Gibbons took it on with the full vim
and vigour that he has always been known to have. He served well as an Opposition Leader and
as Chairman of the Public Accounts Committee, and then as a Minister in the OBA Government when this
countr y faced significant challenges.
Mr. Speaker, the party, the United Bermuda
Party, the OBA, this House, and the country lose the outstanding service and commitment of Dr. Gibbons.
But, in my humble opinion, Mr. Speaker, he leaves
behind a legacy that will a lways live on, an example
for generations that come behind, an achievement
that has rarely been matched and perhaps never ex-ceeded to this date.
Mr. Speaker, I say thank you, thank you to a
man of impeccable character, a man of integrity, a friend, a ment or, an advisor, and a class act.
Mr. Speaker, I say to Dr. Gibbons directly: My
brother, from the bottom of my heart I thank you. And I want to thank Kathy for standing with you all this time
because beside every good man there is a woman
just as strong. So, to you and your lovely wife, best
wishes in whatever you decide to do and know that
you have left a large footprint in the sands of Bermuda history with your service. Let your service be the sti mulus for others to step forward and follow in your footsteps.
Mr. Speaker, I say best wishes to a good
friend and please do not change your telephone number.

[Laughter]
[Desk thumping]

Thank you, Honourable Member . Mr.
Premier?

Hon. E. David Burt: Thank you very much, Mr.
Speaker .
Mr. Speaker , today has, without question,
been a monumental day for a number of particular reasons. And I would say that when Dr. Gibbons got
up and gave his speech, it became even more mem orable. When the former Premier got up to speak, I
thought that we were probab ly going to get another
one.
That much being said, the sentiments that
were stated by the former Premier, though he knows
Dr. Gibbons in a different capacity than those of us on
this side, what we can say, Mr. Speaker, is one thing:
All of us who sit in t his House recognise the pains and
travails of service. And despite which side you sit on, despite the items of which you put forward, we serve.
And service is not easy. Service takes time from your
family. Service takes time from your friends. Service
some times makes what would be routine trips to the
supermarket far less than routine. But that is the job of which those of us who sit in this House have signed up for.


Bermuda House of Assembly So, yes, Mr. Speaker, the Honourable Grant
Gibbons, E. G. G. G., has given his last speech in this
House. But he will be remembered. And so, on behalf
of my colleagues, I wish him all the best in his endeavours. There will be many times that we did fight, whether we sat on this side or the other side. But at
the end of the day he has served the country very
long, and he should be thanked and recognised for his
service.
Mr. Speaker, what I will say in closing, as I
started, is that it has been a very monumental day. We have seen the passage of legislation which will
put Bermuda on the map in reg ard to the new digital
economy. We have seen an announcement made
earlier today with a promise of investment, a promise of jobs, a promise of stimulation for entrepreneurs
and, what is most remarkable, $10 million for Berm udians to become educated to parti cipate inside of this
industry, Mr. Speaker .
This, Mr. Speaker, is what this Government
has set out to do. We hear the complaints —
sometimes we will call them cynical— of those who
wonder why we get on planes. We hear the complaints from those who wonder wh y we continue to
push these particular efforts. These efforts, Mr.
Speaker, are pushed by the vision that this Gover nment has, the vision that will ensure that we will deli ver for the people of which we serve.
Today, Mr. Speaker, is a proud day for the
Progressive Labour Party. But, in my opinion, Mr.
Speaker, it should without question be a proud day for
all of Bermuda.
Thank you, Mr. Speaker .

[Desk thumping]