Kiniksa Pharmaceuticals Proposes Redomiciling from Bermuda to UK Amid Tax Changes

Kiniksa Pharmaceuticals Ltd, a biopharmaceutical company currently domiciled in Bermuda, has announced plans to redomicile to the United Kingdom. The company cites Bermuda's recent introduction of a corporate income tax and potential negative effects of global tax initiatives as the primary reasons for the proposed move.

In a letter to shareholders, Kiniksa explained the proposed scheme of arrangement under which it would relocate its principal holding company's place of incorporation from Bermuda to the UK. The company believes that the move to the UK, which has a more extensive tax treaty with the United States, would be in the best interests of its shareholders, employees, and other interested parties.

Why this matters: Kiniksa's proposed redomiciling highlights the impact of evolving global tax policies on corporate decision-making. The move emphasizes the importance of favorable tax treaties and stable regulatory environments for multinational companies, particularly in the biopharmaceutical industry.

The proposed scheme of arrangement is subject to the approval of Kiniksa's shareholders and the Supreme Court of Bermuda. If approved, the redomiciling would represent a significant change for the company, which has been based in Bermuda since its inception.

Kiniksa's decision to propose redomiciling to the UK comes as Bermuda faces increasing pressure to align its tax policies with global standards. The introduction of a corporate income tax in Bermuda, along with the potential impact of other global tax initiatives, has prompted some companies to reconsider their domicile choices.

The company's shareholders and the Supreme Court of Bermuda will now consider the proposed scheme of arrangement. If approved, Kiniksa's redomiciling to the UK would mark a new chapter in the company's history and could potentially provide a more favorable tax and regulatory environment for its operations.

Key Takeaways

• Kiniksa Pharmaceuticals plans to redomicile from Bermuda to UK due to corporate tax changes.
• Proposed move aims to benefit shareholders, employees, and other stakeholders through favorable tax treaties.
• Redomiciling requires approval from Kiniksa's shareholders and Bermuda's Supreme Court.
• Bermuda's corporate income tax and global tax initiatives prompt some companies to reconsider domicile.
• If approved, Kiniksa's redomiciling to UK could provide more favorable tax and regulatory environment.