In this table we have concentrated on the most common form of vehicle and fund used in each jurisdiction. So for instance, whilst partnerships and unit trusts can be organised with ease in each country, the limited liability company is generally the most popular form of vehicle used.
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Cayman Islands |
British Virgin Islands |
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1. Regulatory Authority |
The Cayman Islands Monetary Authority ("CIMA"). |
The Financial Services Commission ("FSC"). |
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2. Type of Vehicle |
Company (exempted companies), Unit Trust and Limited Partnership. |
Company (BVI Business Company), Segregated Portfolio Company, Unit Trust and Limited Partnership |
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3. Type of Fund |
Open or closed end. Closed end funds unregulated. |
Open or closed end. Closed end funds do not require licensing. |
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4. Licensing/registration requirements |
Non-retail open ended funds registered with CIMA. Retail funds must either be licensed or employ a licensed administrator. Prospectus required on registration/licensing of funds. |
Recognition process for 'private' and 'professional' open ended funds with FSC. Filing of prospectus only required for retail (public) funds. |
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5. Companies Registry |
Annual filing and fees required. Very limited information publicly available. |
Annual fees but no annual filing. Memorandum and articles of association open to public inspection. Registry has internet based on-line filing system (VIRRGIN) to allow 24 hour filings. |
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6. Financial statements |
Audited financial statements to be filed with CIMA and signed off by local auditor. |
No audit requirements for 'private' and 'professional' funds. With 'public'/retail funds, audited financial statements to be prepared and made available to FSC upon request. No filing required. |
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7. Directors |
No residential qualifications necessary. Corporate directors acceptable. CIMA require a minimum of 2 directors for registered funds. |
No residential qualifications necessary. Corporate directors acceptable. The FSC requires a minimum of 2 directors for mutual funds. |
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8. Shareholder meetings |
No requirement for annual meeting. |
No requirement for annual meeting. |
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9. Managers |
No licensing requirements if Securities Investment Business Law exemption/exclusion applies. Simple annual registration and filing would then be required. |
Fit and proper person test applies to Investment Managers and those in a "recognised jurisdiction" are not required to be licensed by the FSC. Generally BVI domiciled managers are licensed under Mutual Funds Act. Restricted license available. Auditor not required in certain circumstances |
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10. Investment restrictions |
None. |
None. |
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11. Bye laws/constitutional documents |
Memorandum and articles of association. May be amended by shareholders only. |
Memorandum and articles of association. May be amended by shareholders or directors. |
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12. Transfer of shares |
Unrestricted save as provided in the articles of association. |
Unrestricted save as provided in the articles of association. |
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13. Currency |
Multi-currency funds permitted. |
Multi-currency funds permitted. |
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14. Administrator |
No requirement for local administrator. Cayman administrators licensed under Mutual Funds Law. |
No requirement for local administrator. BVI domiciled administrators regulated under Mutual Funds Act. |
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15. Custodian |
No custodian requirements. |
FSC requires confirmation of custodial arrangements for mutual funds. |
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16. Investment Adviser |
No licensing requirements if Securities Investment Business Law exemption/exclusion applies. Simple annual registration and filing would then be required. |
No formalities. |
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17. Set Up Time |
Company incorporations 1 day. Registration with CIMA 3 to 5 days |
Company incorporations 1 day. Recognition with FSC 5 to 10 days. |
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18. Taxation |
No income, capital gains or corporation tax and government undertaking that no such taxation, if introduced, will be levied on the income or property of the fund for 20 years. |
Fund and non-BVI investors exempt by legislation from all tax. |
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19. Segregated Portfolio/ Protected Cell Companies |
Permitted under the Companies Law. |
Permitted under the BVI Business Companies Act. |
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20. Name reservation |
Available. |
Available with on line access for registered agent. No charge for 10 day reservations. 90 day reservations for a fee of US$25.00 |
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21. Statutory Merger Provisions |
No. |
Provided within the BVI Business Companies Act. |
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British Virgin Islands Heidi de Vries, Partner Cayman Islands Jonathan Tonge, Partner Mark Lewis, Partner London David Whittome, Partner |
Jersey Heather Bestwick, Partner Hong Kong Philip Millward, Partner Dubai Rod Palmer, Partner |
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
