Bermuda has put itself into the frame to be the first landing hub for submarine communication cables in the Atlantic.

New cable systems are being planned, and the Submarine Communication Cables Act 2020, which was approved by MPs on Friday, is seen as strengthening the island’s hand as it looks to attract transatlantic cables and operators.

At the same time, Bermuda is seeking to follow best practice with a protected landing zone for the cables, which carry internet and telecommunications thousands of miles beneath the ocean. It is doing this through consultation and advice from international geophysical survey company EGS Survey Ltd.

There are three landing hubs in the Pacific, but none in the Atlantic. Bermuda is aiming to be the first, and potential benefits and opportunities range from attracting submarine operators’ head offices, to captive insurance for those companies, and additional revenue from fees and permits.

Companies heavily involved in building submarine cables include global tech giants. They could potentially demonstrate economic substance on the island as a result of their involvement with cables that land here.

Cable systems that currently land in Bermuda are GlobeNet, Challenger and Gemini. There are many more that transit around the island, and by becoming a landing hub the aim is to attract some of those other cables, and new ones, to use Bermuda as a staging post.

Why would a cable operator want to do that?

“There are many cables that transverse the North Atlantic. The US-Europe market is well serviced by various fast, low-latency networks,” said Fiona Beck, a director of the Bermuda Business Development Agency.

“However, with technology changes, cables are looking to transverse from Latin America to Europe, and South Africa to the US. The hub concept picks up traffic linking Africa and Latin America with the US and Europe.”

Ms Beck has an extensive background in the industry. She is a former chief executive officer of Southern Cross Cable Network and is a past president of the industry body Sub Optic.

She is board chairman of South Atlantic Express International, a submarine cable system being planned to connect South Africa with the US.

Ms Beck said companies are looking for a hub to manage traffic capacity and where that traffic can be conveniently split for different destinations, such as the US, Europe, Latin America and South Africa.

It would also provide a way to manage data sovereignty by providing a route to avoid sending data through certain locations.

In addition, for technology companies with global intellectual property companies in Bermuda, a hub would provide further economic substance for them.

Last month, Ms Beck attended PTC, a telecommunications conference in Hawaii that attracted more than 7,900 attendees. She spoke about Bermuda’s “best practice approach with the development of a submarine cable protection zone”. She also held meetings with tech companies such as Google, Facebook, Microsoft and Amazon.

Bermuda’s protection zone legislation provides for two cable landing sites, one at Annie’s Bay, in St George’s, and the other at Devonshire Bay.

The zone has been designed to best practice standards using advice from EGS Survey and taking account of the approach of the International Cable Protection Committee — a body which the Regulatory Authority has applied to become a member.

A survey of the zone, and consultations with organisations including the Marine Resources Board, Commercial Fisheries Council and Ports Authority, considered the potential impact on the marine and land environments.

“The result is a protection area that has minimal impact to sensitive habitats, fisheries, marine heritage and boat users; while still adhering to the industry standards necessary for the development of a first-class system,” Ms Beck said.

“When cables land, they will still need to undertake a detailed marine route survey of their landing to ensure all environmental issues and commercial regulatory issues are managed.”

In the House of Assembly, MPs passed the second reading of the Submarine Communication Cables Act 2020. Walter Roban, Minister of Home Affairs, said the “one-stop shop” regime for approving permits could boost a new industry for the island as a centre for companies installing the communications cables.

In terms of business opportunities for Bermuda, the BDA is also focusing on attracting submarine cable companies to relocate head offices to Bermuda; the “energisation of a captive solution” for the industry, cable marine maintenance requirements; and green initiatives for the generation of electricity for companies’ own data warehousing requirements.

Ms Beck said: “This is a new and growing industry for Bermuda. It strongly supports economic substance and the Government’s agenda with fintech initiatives.

“It is targeting large global tech companies who build such infrastructure. Annual fees (for 25 years) are typical in this industry along with other licensing fees/permits which will bring revenue. These fees are currently being benchmarked to conform with industry standard.”

With large tech firms building about 70 per cent of new submarine cable systems around the world, Ms Beck said: “Having critical infrastructure that lands in Bermuda supports their global network and provides additional presence and economic substance for them in Bermuda.”

In the wake of the Act passing its second reading in the House of Assembly, Ms Beck said: “A new cable can take easily two or three years to plan and two years to build. Systems are being planned now, and this legislation provides the entrée to market Bermuda.

“Building and planning a submarine cable is not a quick business, but it is a business that is around for a very long time. The technical life of a submarine cable is 25 years.”