Brookfield used Cayman Islands to register 3rd fund managed by Carney

A $5-billion investment fund established under Mark Carney’s leadership at Brookfield Asset Management was found to be registered in the Cayman Islands, a known tax haven, based on records acquired by Radio-Canada. This revelation adds to the discovery of two other funds totaling $25 billion that were registered in Bermuda, another offshore tax haven, during Carney’s tenure as the head of the company from 2020 to 2025.

Despite the use of these tax havens, it is important to note that the structures put in place are legal, comply with international tax standards, and are commonly utilized by investment firms. These structures are designed to ensure that Canadian investors pay taxes on the profits from their investments in Canada rather than in foreign jurisdictions.

Brookfield declined to respond to inquiries regarding its use of tax havens in the structuring of its funds. However, the firm has previously stated that it does not partake in tax avoidance practices and that all its entities fulfill their tax obligations in the jurisdictions where they operate.

The issue of Brookfield’s utilization of tax havens has raised concerns among other political parties regarding Carney’s activities in the private sector and his handling of tax matters if the Liberal Party of Canada emerges victorious in the upcoming election on April 28. The Liberal Party has chosen not to address inquiries regarding the registration of the fund in the Cayman Islands.

Carney has defended the decision to register the two Brookfield funds in Bermuda as a matter of efficiency rather than tax avoidance. He emphasized that the funds flow through to Canadian entities that pay taxes appropriately, preventing multiple layers of taxation along the way. The two funds registered in Bermuda are the Brookfield Global Transition Fund ($15 billion) and the Brookfield Global Transition Fund II ($10 billion), established in 2021 and 2024, respectively.

In contrast, the third fund registered in the Cayman Islands, known as the Catalytic Transition Fund, was launched in 2024 with a focus on investing $5 billion in clean energy and transition assets, particularly in emerging markets. Initial investors included Altérra, backed by the United Arab Emirates, and the Caisse de dépôt et placement du Québec, among others.

Tax expert Jean-Pierre Vidal emphasized that the use of tax havens serves to reduce taxes paid in foreign countries, leading to companies paying more taxes in their home country upon repatriation of investments. While jurisdictions like the Cayman Islands and Bermuda offer low corporate tax rates, they contribute to cost savings for firms like Brookfield.

The Conservative Party has been critical of Carney’s ties to Brookfield, particularly in the realm of renewable energy and green technologies. They have also questioned the lack of disclosure regarding the assets placed in a blind trust by Carney upon assuming leadership of the Liberal Party and the prime minister position.

In response to these criticisms, Carney has underscored the establishment of a blind trust in collaboration with the ethics commissioner and the implementation of anti-conflict measures to prevent any issues affecting Brookfield. Nonetheless, political opponents continue to scrutinize Carney’s actions during his time at Brookfield, with the NDP vowing to end tax agreements with jurisdictions like Bermuda if elected.

As the election approaches, the Bloc Québécois has called on Carney to disclose his foreign assets, with leader Yves-François Blanchet asserting that taxes should apply to all individuals, including millionaires and billionaires like Carney. The ongoing discourse surrounding Carney’s past dealings at Brookfield underscores the importance of transparency and accountability in the political landscape.