On December 2 2010, Bermuda signed a Tax Information Exchange Agreement (“TIEA”) with the People’s Republic of China in an effort to strengthen the economic and political ties between the two countries.  Both Bermuda and China served as co vice-chairs of the Organisation for Economic Co-operation and Development (“OECD”) Global Forum on Transparency and Exchange of Information for Tax Purposes and the TIEA established between the two countries is based on the OECD’s principles of transparency and cooperation.  According to Bermudian Premier Paula Cox, the TIEA will not only enhance commercial and economic ties to China, but it will also enable the island to reach out to other Asian markets.

There are currently 680 entities operating in Bermuda that have a Chinese interest and many entities based in China are listed on the Bermuda Stock Exchange (BSX).  For China, the signing of the TIEA demonstrated the country’s ongoing effort to crack down on tax evaders.  This is the third TIEA signed by China and the twenty-third signed by Bermuda.