Securities business is regulated by the Securities Investment
Business Law (2011 Revision)('SIBL'). Schedule 1 of the
SIBL defines 'securities' as:
shares or stock of any kind of the share capital of a
debentures, loan stock, bonds, certificates of deposit and any
other instrument that creates or acknowledges debt (excluding
various banking and monetary instruments e.g. cheques, mortgage
instruments and land charges);
warrants and other instruments that allow the holder to
subscribe for certain securities;
certificates or other instruments which confer contractual or
options on any security and on any currency, precious metal or
an option on an option;
rights under contracts for differences (e.g. cash-settled
derivatives such as interest rate and stock index futures, forward
rate agreements and swaps).
Regulation of Securities Investment Business
SIBL regulates natural or corporate persons carrying on
securities investment business, including market makers,
broker-dealers, securities arrangers, securities advisors and
securities managers, in or from the Cayman Islands.
The Cayman Islands Monetary Authority ('CIMA') is
directly responsible for licensing, supervision and enforcement.
CIMA may investigate persons whom are believed to be undertaking
securities investment business without a licence.
The processing of licence and registration applications and the
ongoing supervision of securities investment business licensees is
the responsibility of the Investments and Securities Division of
Regulated Business – Categories
There are 2 categories to be considered, namely licenced persons
and excluded persons. Persons engaged in securities investment
business must be:
the holder of a Securities Investment Business Licence, or
Registered as an Excluded Person.
In determining whether a person is engaged in licensable
activity, regard must be had to the definition of
'securities' in Schedule 1 of the SIBL.
'Excluded Activities' are set out under Schedule 3 SILB
and a list of 'Excluded Persons' can be found at Schedule
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.
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