Company: FRFXF
Filing Date: 2025-03-26
Form Type: 424B3
Source: 0001104659-25-028272
Chunk: 130

Company: FAIRFAX FINANCIAL HOLDINGS LTD/ CAN
Filing Date: 2025-03-26
Form: 424B3
Chunk 130
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 a multi-national group are subject to tax under the CIT Act, such tax is charged at a rate of 15% of the net taxable income of such constituent entities as determined in accordance with and subject to the adjustments set out in the CIT Act(including in respect of foreign tax credits applicable to the Bermuda constituent entities). Tax is chargeable under the CIT Act for tax years starting on or after January 1, 2025. In addition, the CIT Act includes transition rules including carryforward tax losses incurred in the five fiscal years preceding the effective date or increases in the tax basis of assets and liabilities.

The CIT Act also provides relief from double taxation via foreign tax credit based on the adjusted amount of foreign taxes accrued by the group. The CIT Act is designed as a covered tax for the purposes of the OECD’s Global Anti-Base Erosion Rules (“ GloBE Model Rules”), meaning the CIT Act does not presently apply an income-inclusion rule or under taxed profits rule in the same way as the GloBE Model Rules do.

Future developments and guidance under the GloBE Model Rules may impact Bermuda’s implementation of its corporate tax regime, and any future changes to the Bermuda corporate income tax regime may impact our tax liability, financial condition and results of operations and could increase our administrative expenses.

The CIT Act does not impose anywithholding tax, capital transfer tax, estate duty or inheritance and no such taxes are payable by
us or our Holders of Notes (who are non-residents of Bermuda) in respect of the exchange of Initial Notes for Exchange Notes pursuant
to the Exchange Offer. This discussion does not, however, apply to the taxation of persons ordinarily resident in Bermuda. Bermuda resident
shareholders should consult their own tax advisors regarding possible Bermuda taxes with respect to the exchange of Initial Notes for
Exchange Notes pursuant to the Exchange Offer.

Bermuda currently has no
tax treaties in place with other countries in relation to double-taxation or for the withholding of tax for foreign tax authorities.

Economic Substance

Legislation enacted in Bermuda
as to economic substance may affect our operations. Pursuant to the Economic Substance Act 2018 (as amended) of Bermuda (the “ES Act”) that came into force on 1 January 2019, a registered entity other than an entity which is resident for tax purposes
in certain jurisdictions outside Bermuda (“non-resident entity”) that carries on as a business any one or more of the “relevant
activities” referred to in the ES Act must comply with economic substance requirements. The ES