Bermuda has strengthened its links with Australia with the first Tax Information Exchange Agreement (TIEA) between the two countries coming into force in a bid to clamp down on tax evasion and money laundering.

The Australia-Bermuda TIEA signed by Finance Minister Paula Cox at the Australian Embassy in Washington DC in November 2005 finally came into effect last month.

She said one of the main benefits of the new relationship was Australia's recognition of the Bermuda Stock Exchange (BSX).

For Australia it is the first ever TIEA and, according to the country's Minister for Revenue and Assistant Treasurer, Peter Dutton, it "represents a significant step in Australia's efforts to prevent offshore tax evasion and avoidance".

The agreement came about following a recent exchange of diplomatic notes between the two governments, after which Ms Cox declared she was glad to strengthen ties with the Antipodean nation.

"Bermuda, as a leading responsible international financial centre, is pleased to strengthen our relationship with Australia in support of our commitment made to the OECD in 2000," she said.

"Our commitment was to adopt further legal mechanisms that allow tax information to be exchanged with other jurisdictions in a more timely and effective manner similar to the 1986 TIEA that Bermuda has with the USA.

"We were impressed with Australia's goodwill approach to the negotiations and look forward to the higher level relationship developing even closer ties between out two countries.

"A key benefit arising from this stronger relationship with Australia was Australia's recognition of the BSX."

Meanwhile, Mr. Dutton commended Bermuda for its continuing leadership in achieving the aims of the OECD's Harmful Tax Practices Initiative and related Global Forum on Taxation, demonstrated by its willingness to implement the higher standards of transparency and information exchange to which it is committed.

The TIEA will provide a full exchange of information on criminal and civil tax matters between the two nations and came into effect as of January 2006 in terms of serious tax evasion and impacts, with respect to all other matters from January 2008.