Cayman offers a well-regulated and internationally respected, tax-neutral, offshore business environment. The type of Cayman structure required or best suited for a particular endeavour will depend largely on the type of business and whether it will be conducting its affairs locally or outside of the Cayman Islands.
Corporate Law & Taxation
Cayman Islands' companies law is based on English common law. There are two types of Cayman Islands companies: the Exempted and the Non-resident. The ongoing licence fees for a Non-resident Company are slightly less than that for an Exempted Company but a Non-resident Company must submit a more detailed annual return.
Chinese character names are permitted and can be included in a company's Certificate of Incorporation. All Exempted Companies must have a registered office provided by a licenced service provider. A minimum of one shareholder and one director are required and corporate directors are permitted. The Registers of Directors, Officers and Charges must be kept at the Registered Office. A copy of the Register of Directors and Officers must be filed with the Registrar of Companies but is not available for public inspection. Every Exempted Company must keep a Register of Members and the original or a copy should be kept at the Registered Office. While bearer shares are permitted, in practice they are not encouraged and bearer share certificates must only be held by approved custodians.
Company Registry Fees
Company Registry Fees The registration and annual fees for any company are dependent on the size of the authorised share capital. Also worth noting is that licence fees are due annually in January of each year, but the Companies Registry is under no obligation to notify the company that the fees are due. Every company is responsible for paying these annual fees and if you do not pay them the company will usually be struck off the register of Cayman Islands incorporated companies. If the company had any assets at the time it was struck off, those assets would then become the property of the Government of the Cayman Islands and dealings with such assets deemed to be illegal. It is possible, if you were ignorant of the fact that annual
Funds & Investment Business
Cayman is the largest centre for hedge funds in the world and some funds require regulatory approval. Investment businesses may also need to be licensed by the CIMA. An attorney can both advise on the necessity for a licence/regulation and assist in compliance with the necessary formalities.
Cayman Island Branches
A registered Cayman Islands branch will not have a separate legal personality from the main company headquartered overseas. In many cases, this is desirable for group operations which are required to maintain tax residency in a certain jurisdiction but wish to have a Cayman Islands presence from which to conduct certain business of the group. In the case of a bank, trust company, insurance company, management company, mutual fund, mutual fund administrator or any entity carrying on securities investment business, a licence to conduct such business will be required from the CIMA even though such business is actually conducted outside the Cayman Islands.
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