Company Limited by Guarantee Formation

The Bermuda company law structure permits the incorporation of companies for charitable or other socially useful purposes, including art, science, religion, sport and education. These companies are called Companies Limited By Guarantee.

Such a company is defined under the Companies Act as having the liability of its members limited by the memorandum to such an amount as the members may respectively contribute to the assets of the company in the event of it being wound up. The Companies Act specifically provides that such companies may not distribute income or pay dividends to their members.