The Bermuda Monetary Authority (BMA) published a consultation paper proposing enhancements to Bermuda’s investment funds framework that would introduce more prescriptive sustainability-related disclosures for funds making sustainability claims and prohibit the use of misleading fund names. The proposals apply to Bermuda-registered and authorised funds, with designated overseas funds explicitly out of scope. On disclosures, the BMA proposes expanding definitions in the Investment Funds Act 2006 and enhancing the Investment Fund Offering Document Rules 2019 so that sustainability-related claims are accurate, clear, complete and substantiated. Product-level disclosures would cover investment focus and objectives, investment strategy and sustainability criteria used (including minimum asset allocation linked to the sustainability focus), sustainability-related risks and limitations, use of reference benchmarks for sustainability focus and financial performance, valuation practices for sustainable assets, conflicts of interest, and the nature and frequency of sustainability-related ad hoc reporting. If a fund’s investment objectives cease to include sustainability-related considerations, this would be treated as a material change requiring notification to the BMA and investors. On fund names, amendments to the Investment Fund Rules 2019 would prohibit names that do not accurately reflect a fund’s business activities, including the use of sustainability-related terminology or references to insurance-linked securities where the strategy does not align. The prohibition would apply to all funds, supported by implementation criteria in the Investment Funds Guidelines, and a breach could require steps such as changing the fund name or revising the fund strategy. Comments are due by 25 November 2025, and the BMA proposes a six-month transitional period for Bermuda-authorised and registered funds on the Investment Funds Act register to comply with amended requirements.
Bermuda Monetary Authority 2025-09-02
Bermuda Monetary Authority launches consultation on sustainability disclosures and ban on misleading fund names
The Bermuda Monetary Authority has issued a consultation paper proposing enhancements to the investment funds framework, focusing on sustainability-related disclosures and prohibiting misleading fund names. The proposals aim to ensure accurate sustainability claims, with expanded definitions and enhanced rules under the Investment Funds Act 2006 and Investment Fund Offering Document Rules 2019. Amendments would also prohibit fund names that misrepresent activities, with compliance required within six months.