Mr. Speaker, I am pleased to give this statement today to update this Honourable House and the listening public on the Government’s intentions for allowing international law firms to have a presence in Bermuda. 
 
Honouarable Members may recall that in the 2018/2019 National Budget, Government announced that we have already begun the process of making Bermuda’s economy more competitive and of stimulating additional investment in Bermuda. It was also noted that in support of this initiative this Government would be welcoming global law firms to Bermuda.  It is the Government’s view that the presence of international law firms in Bermuda will generally benefit the economy and employment prospects of Bermudians as well as enhance the national brand exposed through global channels.  
 
Mr. Speaker, to progress this proposal the Registrar of Companies (ROC) commenced consultation with the legal sector on allowing global law firms to have a presence in Bermuda. This consultation involved the ROC, on behalf of the Ministry of Finance, releasing an industry notice to key stakeholders. The stakeholders were invited to give their feedback on any concerns they may have about opening the legal market to international law firms as well as any conditions they believe should be imposed in section 114B licences in order to preserve the interests of Bermudians. Accordingly, the following key stakeholders were invited to give feedback.  

• The Bermuda Bar Council
• Each law firm listed on the Bermuda Bar Association’s website
• The Bermuda Business Development Agency
• The Business Development Unit, a section formerly of the Ministry of Economic Development and Tourism and now under the Cabinet Office, and
• The Department of Immigration. 

A summary of responses from stakeholders is as follows: 
 

• In total 28 submissions were received in response to the industry notice;  
• 18 were from various law firms and individual lawyers; 
• The Bermuda Bar Council declined to put forward a formal response, but forwarded a  a compilation of ten letters dating back to 2015 from various law firms and individual lawyers to the then Minister of Home Affairs regarding overseas firms setting up in Bermuda;
• 9 were positively in favour of allowing international law firms to enter the Bermuda legal market; citing competition, increased global exposure and investment as benefiting the economy as well as better professional development and career opportunities for Bermudian lawyers;  
• 6 expressly disapproved of allowing international law firms to enter the Bermuda legal market. The grounds of objections were that international law firms would be damaging to existing law firms and that they may simply open a ‘front’ in Bermuda by engaging the services of a ‘figurehead’ Bermudian. Concern has also been expressed that the development of international business in Bermuda has been spearheaded by the Bermudian owned legal sector. They said that the legal services sector is a major contributor to the offshore services economy, the result of 50 years of continuous investment and development of Bermuda, mostly by the private investment of law firms who have provided first class services to support the international business;  
• The BDA is strongly in favour of relaxing the law firm market and opening it up to greater competition on the ground as that will open more channels to push out positive Bermuda messaging and increased opportunities for business flow, particularly in and from Asia. 

 
Mr. Speaker, there have been several broad policy discussions, over the past eight years or so, about the formulation of a policy regarding the presence of international law firms in Bermuda.  Under the current circumstances, it is prudent for the Ministry to establish clear policies with respect to local law firms wishing to obtain a licence under section 114B of the Act in order to partner with international law firms. 
 
Mr. Speaker the ROC and Ministry of Finance have carefully considered all feedback from industry. Additionally the ROC has conducted research on how other similar jurisdictions contend with the presence of international law firms. Following this due diligence, the Ministry proposes to prudently liberalize the law firm market and open it up to international firms. Accordingly, each section 114B licence application in relation to an international law firm will be decided based on its own merit and in addition to the standard conditions imposed, each license application will be decided on the following provisional conditions which are intended to preserve the interests of Bermudians: 
 
1. The law firm will be required to have physical presence in Bermuda, i.e. it must operate from Bermuda with staff and management in Bermuda.  
 
2. Legal work involving matters of Bermuda law, originated in Bermuda, must be undertaken in Bermuda by lawyers with a current practising certificate and cannot be outsourced to lawyers and paralegals in another jurisdiction and merely rubber stamped in the Bermuda office.   
 
3. The law firm will be required to provide scholarships to Bermuda law students, recruit, train (i.e. pupillage and post pupillage professional development) and employ Bermudians at all levels as well as provide them with experience in the firm’s overseas offices.  
 
4. As part of the section 114B application, the law firm will be required to produce a five year business plan that includes (a) how it plans to increase revenue from offshore work and (b) a diversity and inclusion progression policy designed to identify and prepare candidates for partner and high level management positions that is based on ability but also mirrors the multicultural composition of the Bermuda community. 
 
5. The law firm will be required to submit an annual report to the Minister to demonstrate adherence to the business plan.  
 
Mr. Speaker, the Government is confident that this policy to relax the law firm market and open it up to international firms, along with the above mentioned licence conditions strikes the correct balance between stimulating additional investment in Bermuda and providing opportunities for Bermudian lawyers and preserving the interests of Bermudians.  

 
Thank you, Mr. Speaker