The 'Bermuda Scheme' & the 'UK Transfer'
The previous Club structure utilised three companies, UK Bermuda, UK Europe, and IPIR. UK Bermuda was the holding company and the Club of which all insureds are Members.
Although many Members were insured directly by UK Bermuda, (through its respective branches in the UK, Hong Kong, Singapore, and Japan), substantial numbers were already insured by the subsidiary, UK Europe. Originally, both UK Bermuda and UK Europe were reinsured by the UK Club’s wholly owned subsidiary International P&I Reinsurance Company (IPIR).
In September 2012, Members received a package of information explaining both the Bermuda Scheme and the UK Transfer. Examples of the documents contained in that package are found below. To aid understanding a set of ‘frequently asked questions’ were also published. These “FAQs” are also provided below.
As UK Bermuda is a company incorporated in Bermuda, the transfer had to be sanctioned by the Supreme Court of Bermuda. Under the terms of the Bermuda Scheme current and past Members who were creditors of UK Bermuda were invited to support the Scheme by voting (by proxy or in person) at a meeting on 29 October 2012. Their individual voting entitlement was calculated by reference to a pre-populated claims form.
In respect of UK Bermuda’s UK branch the transfer used a court-approved scheme under Part VII of the Financial Services and Markets Act 2000. This UK Transfer did not require any action unless a Member wished to object.
Members approved the re-structure at the Club’s Annual General Meeting held in Paris on 29 October 2013. The sanctioning of the UK Transfer by the High Court under the Part VII process was granted on the 31st October. On the 9th November the Supreme Court in Bermuda also sanctioned the transfer of UK Club (Bermuda)’s business to UK Club (Europe).
Further information regarding the UK Transfer and the Bermuda Scheme can be found below.
The restructure process for the ‘Bermuda Scheme’ and the ‘UK Transfer’ broadly followed the following key steps of consultation, review, documentation and legal oversight.
1. Initial phase
Discussions with regulators
Appointment of independent expert
Preparation of legal documents
Independent expert’s report
3. Preliminary court hearing
4. Consultation period
Approximately eight week period
5. Final court hearing
6. Transfer becomes effective 20th February 2013