The legislation governing insolvency in Bermuda is the Companies Act 1981. This Act is supplemented by rules and procedures set out in the Companies (Winding-Up Rules) 1982. This act governs the liquidation or winding-up procedures of companies in Bermuda. There is additional legislation pertaining to the winding up of financial institutions. Personal bankruptcy is an infrequent occurrence and relates to the insolvency of individuals pursuant to the Bankruptcy Act 1989.
Statutory procedures include members’ voluntary winding up, creditors’ voluntary winding up and a court-ordered winding up. By way of private contract, a receiver of assets may be appointed subject to a debenture or other form of security,
and a court may appoint a receiver in some circumstances. Receiverships are not common and most insolvency actions are by way of a winding-up procedure to liquidate the company.
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