They've been talked about for a while by our bloggers and contributors but the moment has now come for the Cayman LLC, which has been available for registration since 13 July and numerous of which have already been formed. The Cayman LLC was introduced to meet the requirements of North American managers and intermediaries who use Delaware LLCs and want a flexible offshore version, and Cayman lawyers dealing regularly with North American clients are particularly excited about now being able to offer a "Cayman" version. Its introduction also highlights Cayman's responsiveness to market demand as it continues to maintain its position as the dominant brand in North America for funds structures.

So what makes the Cayman LLC – or limited liability company, to give it its full name – so interesting?

Well, Cayman's taken the best bits of the popular limited partnership structure and the best bits of a company and combined them into an LLC format which is closely aligned to a Delaware LLC. This makes them both flexible and familiar for onshore counsel looking to structure new investment funds and private equity structures. We're also expecting them to be popular for corporate transactions, including joint ventures, special purpose vehicles and holding companies where the LLC agreement can be tailored to suit the particular transaction.

It's pretty straightforward to set one up: with registration is just a matter of paying a fee to and filing a registration statement with the Registrar of LLCs in the Cayman Islands. An LLC is a separate body corporate, can be formed for any legal purpose, and must have at least one member at all times. There are no Cayman residency requirements for either members or managers of LLCs, who can be based anywhere in the world. The LLC needs a registered office in Cayman, an LLC agreement governed by Cayman Islands law (similar in form to a Delaware LLC agreement) and must maintain certain statutory registers (of members, managers, security interests and mortgages and charges) and records.

The LLC agreement itself can vary certain parts of the LLC Law to fit with the commercial needs of the parties, and isn't filed with the Registrar or otherwise publicly available. The manager/s of an LLC owe a duty of good faith, which can be expanded or restricted by the terms of the LLC agreement as agreed between the parties. Otherwise, the members and managers do not owe any fiduciary duties to the LLC or any member unless this is specifically provided for in the LLC agreement.

Further features include foreign corporate bodies being able to migrate into Cayman as an LLC, Cayman exempted companies (other than segregated portfolio companies) being able to convert into LLCs, and provisions for mergers and consolidations of LLCs with other LLCs, exempted companies or foreign companies.

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.