Cayman Islands: Trust Industry Evolves In Changing World

The private trust industry is changing and will undoubtedly continue to evolve as the industry moves forward. The robustness of private trusts is being tested through challenges such as the right to privacy, versus the desire on the part of governments for greater transparency and reporting initiatives, including the US Foreign Account Tax Compliance Act (FATCA), UK FATCA and the Organisation for Economic Co-operation and Development (OECD) Common Reporting Standard (CRS). As a result of high profile tax evasion cases in recent years and the need for governments across the world to grow tax revenue, the industry is under increased scrutiny from international legislators, regulators and tax authorities. These initiatives and pressures increase the cost of carrying on trust business and the risks associated with that business, leading some to question the future of the industry. However, there is and will continue to be a place for private trusts in the wealth planning for international families and businesses.

In order to appreciate how the local industry will evolve it is important to understand how the landscape of trusts in the Cayman Islands has changed in the past two decades.

Twenty years ago a typical portfolio of trust business was comprised of relatively straightforward trusts of varying types, with underlying holding companies mainly holding asset classes of financial investments or real estate for the first generation of stakeholders. Today, trust structures are generally much more sophisticated. They hold a full range of asset classes including operating businesses, they involve private trust companies (PTCs), and family office functions and they are often for the benefit of two or three generations of family members living in multiple jurisdictions. Trust companies servicing those structures provide a full range of services, including provision of independent directors to PTCs and other family companies, and they are required to liaise with international advisers on an ongoing basis to assist family members to remain tax compliant in the relevant jurisdictions.

Cayman is one of the leading international centres for the creation of complex trust structures. The trust industry in Cayman has kept pace with client requirements over the years due to a number of important factors. Cayman has a solid Trusts Law, it led the way with the creation of the Special Trusts Alternative Regime (STAR), it provides for the licensing of PTCs as restricted licensed trust companies, and has more recently introduced a registered PTC regime. Trust legislation is supported by a strong and highly regarded local judiciary. In addition, the industry has been assisted by the jurisdiction's ability to respond and deal appropriately with various international initiatives including US and UK FATCA and other challenges that have been ongoing for over a decade. The demonstrated ability of local service providers to support the more sophisticated trust structures has been crucial in enabling the jurisdiction to stay ahead of its competitors. Cayman's service providers are amongst the most highly regarded trust practitioners internationally.

The before mentioned factors form a solid foundation for the future. The question now is how does the industry continue to evolve to meet the changing needs of families as their wealth continues to grow, as that wealth transitions to second, third and even fourth generations, and as the more charitableminded consider how they can change the world for the better through their philanthropic giving. The industry will also need to consider how it can assist families to balance their growing international reporting obligations while maintaining the privacy that they require regarding their personal affairs. A glimpse into the future would suggest that some of the developments around the world that will provide opportunities for the Cayman trust industry include those outlined below.

Tax Planning and Beyond

While historically the creation of trusts offshore has often been driven by tax planning for the current generation, this is changing. While overall tax considerations will always be taken into consideration, the focus is changing to planning for the protection of assets and wealth succession for future generations of the family. Cayman provides a tax neutral, stable, sophisticated environment for such planning. The jurisdiction seeks to balance the need for privacy against the demands for greater transparency in a sensible and mature manner.

The New Rich

There has been significant wealth generation in both new and developed markets across the globe. A significant portion of that wealth has been generated by entrepreneurs, and as those entrepreneurs reflect on their recent riches they need to consider how to protect and sustain that wealth going forward. They require sophisticated structuring advice which often includes trusts. This creates new opportunities for Cayman service providers as they can not only assist with the creation and administration of such structures, but also with the education of the family members to ensure the ongoing integrity of such structures, the sale or listing of private companies within those structures and the future investment of funds raised from such sales or listings.

Relocation of Families

The world has changed. The ability to stay in touch with family members across the world is easier than ever. People can work from anywhere there is an internet connection. This allows families to be even more mobile than they have been previously, and to move to jurisdictions that provide them with a high quality of life and which welcome them and provide an environment conducive to the management of their wealth. Cayman provides that type of environment and service providers need to communicate that message to their wealthy clients. Relocation to Cayman provides a different set of opportunities for local service providers as those families will seek to invest in the jurisdiction over time.

Family Office Functions

As trust structures become more sophisticated it may be important that they include a family office to support the administration of such structures. Looking forward it is likely that the location of a family office in the jurisdiction in which the structure is created will become more important. This means the movement of staff and their family members to that jurisdiction and the creation of additional jobs for local residents. The Cayman Islands boasts world class living accommodations, restaurants, schools, political stability and a legal framework that is attractive to wealthy families considering family office possibilities. Service providers have an opportunity to assist stakeholders with the establishment of family offices and/or to provide family office functions.

Philanthropic Giving

Wealthy families are increasingly looking for opportunities to use their wealth for positive social change around the world. While many do this through existing charitable organisations, others create their own foundations to focus on their own particular areas of interest. There is an increasing opportunity for Cayman service providers to assist with such foundations, which can be created within Cayman trust structures. These structures often use Cayman PTCs to allow the family some active involvement in the day-to-day decisions of the foundation. STAR trusts provide opportunities to create structures that are not for strictly charitable purposes but which are still philanthropic in nature.

Wealth Management

Wealth management is not as prevalent in Cayman as it is in other jurisdictions. There is certainly an opportunity to attract such business to Cayman for many of the reasons already noted. As the industry continues to grow, families and family offices will require an increasing range of services from wealth managers located in Cayman. As those services are demanded locally there will be international managers who will seek to take advantage of the opportunities as they arise.


In summary, while the trust industry has faced, and continues to face, international pressure and challenges there remain many opportunities for it to grow and thrive in Cayman. The complex structures that families now require to hold established business ventures, intellectual property rights, alternative financial investments, real estate and other assets provide many opportunities for Cayman. Private trust companies, family office services and philanthropic foundations require a jurisdiction that meets all their needs and Cayman practitioners are strategically placed to seize the opportunities and provide the services to trust structures that global private clients require and demand.

About the Author

Tamara Corbin is a Partner with Rawlinson & Hunter Cayman Islands. She specialises in private client services including international trust structures, private trust companies and purpose trusts, estate planning and wealth management. Tamara is a qualified CPA, a member of STEP and CISPA. She is an Executive Committee Member of the Cayman Islands branch of STEP.

About the Author

William Walmsley is a Partner with Rawlinson & Hunter Cayman Islands. He specialises in private client services and advises on the establishment and ongoing administration of Cayman Islands trusts and companies, including acting as a director of a number of private trust companies and other regulated entities.

William is an FCA (Ireland), a member of STEP, former Vice Chairman and Treasurer of the Cayman Islands branch of STEP, is a board member of Cayman Finance and a member of CISPA.

Originally published in Cayman Finance Magazine, 2015-2016, Issue 2

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Cayman Finance
Cayman Finance
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Cayman Finance
Cayman Finance
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions