New beneficial ownership regime is up and running


Law changes allowing the exchange of beneficial ownership information kicked into effect on Saturday July 1, bringing Cayman in line with international standards.

The law changes create the framework for Cayman’s electronic platform which will be used to transfer a company’s registry information to UK authorities upon request only.

In terms of what this means for the investment funds industry, a legal note from Harneys says that, essentially, companies which are subject to some form of direct or indirect regulatory oversight are likely to be exempt from the requirements to maintain a beneficial ownership register.

For the investment funds industry, this means that Companies which are structured as Cayman Islands investment funds, whether hedge funds or private equity funds, Cayman Islands investment managers, which are registered as “Excluded Persons” under the Securities and Investment Business Law (SIB Law), and general partners of private equity funds or other investment funds, will not have to maintain beneficial ownership registers provided they fall within one of several exemptions contained in the legislation.

There are currently no proposals to extend the registers to cover beneficial ownership of limited partners of Cayman Islands exempted limited partnerships or foreign companies and foreign limited liability companies registered in the Cayman Islands, Harneys notes.

The law firm suggests that all Cayman Islands Companies should now review whether or not they will be required to maintain a beneficial ownership register or if they fall within one of the exemptions in the legislation.

Harneys, Cayman Islands, Beneficial ownership

Cayman Funds