FRIDAY, FEB. 24: Premier Paula Cox fired a shot across the bows of rival offshore destination the Caymans.
Ms Cox said that comments by Cayman Premier McKeeva Bush aimed at taking business from Bermuda were “not befitting of a statesman.
“My view is that everyone looks at Bermuda with a lean and hungry look — that’s why we can’t be complacent and take our eyes off the ball.
“We know that people are very jealous of what Bermuda has.”
Mr Bush, quoted in the Caymanian Compass, took aim at Bermuda’s reinsurance business — and said the Caymans offered a better deal for companies.
Mr Bush said: “Perhaps that’s what my friend in the middle of the Atlantic does not realise. We have space.”
He added that “zero payroll taxes”, cheaper operating costs and the right to buy property were all available in the Caymans.
And he said: “We have shown that we can grow without the malice, without the inhibitions of race, without the inhibitions of transport ...”
But Ms Cox warned the Caribbean UK Overseas Territory not to mistake “kindness and softness for weakness” and said Bermuda would fight to protect its turf against competitors.
Ms Cox accused shadow Finance Minister Bob Richards of a lack of patriotism and siding with “the leader of a competitor jurisdiction against his own.”
But Mr Richards hit back and said: “I guess that depends on her definition of patriotism. If her definition means we have to lie, then I’m guilty because I am not going to lie.”
Ms Cox said: “The OBA instead sides with Cayman and wishes for Bermuda to ignore the key organisations like the OECD (Organisation for Economic Cooperation and Development) and initiatives like the EU’s solvency II initiative and they want the voting public to buy in to a flawed model of fostering international business growth with the hallmark being light or no touch supervision.
“Bermuda’s national interest should always come before partisan warfare. These most recent utterances causes one to question how far the OBA is willing to go to score political points. We have to be better than that.”
Mr Richards said: “What I was talking about was the truths Mr McKeeva Bush was saying about Bermuda.”
Mr Richards said Mr Bush had highlighted that his government had reduced fees — while Bermuda had said it “may reduce fees.”
And he said that Mr Bush had also said that Bermuda “was still talking about their immigration policy and making long statements but not actually doing anything.”
Mr Richards added: “These inhibitions, that malice and that racial rhetoric was directed at us and there’s nobody in this island who can say that’s not true. It is true.
“I didn’t take it to the international stage — I was commenting on something which appeared in the local press and in this day and age of the Internet, everything is international.”
Ms Cox added that Bermuda would not adopt the Brussels-based European Union’s Solvency II directive — which is aimed at ensuring insurers closely match the amount of capital they hold to the risk on their balance sheets.
She said that Bermuda would develop its own supervisory framework tailored to conditions on the island.
Ms Cox explained: “The Bermuda Monetary Authority’s view is that adopting a one size fits all approach is simply inappropriate, both for the regulators and the regulated.
“Bermuda has been very clear that, while it seeks equivalence under the Solvency II directive for its large internationally-active insurers and reinsurers, this must be a practical form of equivalence.
“It must be one that is appropriate and relevant and which works not just for Brussels but also for the entire Bermuda market.
“We should stress here that equivalent supervision is not the same as identical supervision.”
Ms Cox said that not all Bermuda-based insurers wanted to carry out business either with or in the EU .
She added: “However, for those who do wish to conduct business in Europe this would mean an approved insurer in one participating European country would not have to spend the time, energy and money to seek a license in another.
“Accordingly, the Bermuda Monetary Authority has sought and been granted permission to segment its risk industry into large commercial entities which desire equivalence and those that do not.
“In practical terms, this means that most of Bermuda’s special purpose or captive insurance company market will be largely unaffected by Solvency II requirements.”
Mr Richards said he had never spoken out against Government’s attempts to come up with an equivalent to the EU rules on solvency.
He added: “It’s causing problems for us, but I don’t see any other way we can go. Our Class Four insurance companies, who are our major players, they want it and if they don’t get it they will have to leave Bermuda and we don’t want that.”