Cayman Islands: Why List A Fund On The Cayman Islands Stock Exchange?

Last Updated: 17 April 2007

The CSX is a well established and internationally recognized stock exchange located in one of the world’s largest financial services centers. It specializes in the listing of hedge funds and other mutual funds with over 900 current fund listings.

Advantages to listing a fund on the CSX include:

Credibility – The CSX is a well-regulated exchange, evidenced by its status as an affiliate member of IOSCO and as the only offshore exchange that is an affiliate member of the Intermarket Surveillance Group, a surveillance focused group of over 30 exchanges from around the world, including all US equity and derivatives exchanges (for further details see "Recognitions and Affiliations" on www.csx.com.ky).

Tax advantages
– The CSX is the only offshore exchange in a North American time zone that has UK HMRC recognized status whereby UK investors can receive interest and dividend payments tax free.

Access to a bigger investor pool - Listing on the CSX is the seamless extension to setting up a fund in the Cayman Islands. It provides an unhindered opportunity to market the fund to institutional investors who may face legal or regulatory constraints on investing in unlisted securities.

Value-added regulation The CSX provides value-added services for investors who like or require the additional oversight and transparency a listing brings. The CSX vets the initial listing documents and reviews for the suitability of the issuer’s directors, investment manager, administrator, custodian and auditors; conducts daily market surveillance, electronically monitoring and reviewing NAV filings for unusual changes in price and volume; monitors for the timely filing of NAVs and financial statements; conducts reviews for compliance with continuing disclosure obligations; and publishes pricing information on listed issues on its website and through Bloomberg.

Flexibility - CSX listing rules are easy to understand and commercially driven. They are tailored to (1) accommodate the latest structures and products and (2) to meet the needs of issuers who market their offerings to institutional and high net worth investors, emphasizing the disclosure of all relevant information without imposing unnecessarily onerous conditions and restrictions. For example:

  • no investment restrictions or minimum capitalisation requirements apply;

  • there is no requirement for locally resident directors;

  • no audited financial statements are required to list a recently established fund where operations have not yet commenced;

  • no interim statements need be filed unless prepared for other reasons; and

  • the provisions of EU directives, including the EU Prospectus Directive, do not apply.

Efficiency CSX staff are committed to meeting each issuer’s listing deadline. The listing application process is completely electronic, enabling staff to meet requested document turnaround times. There is no enhanced fee for speedy handling of new listings.

Price Leadership – The listing fee is US$2500 for a fund and US$1000 for a subsequently listed sub-fund. The annual fee for a fund is US$2500, other than for an umbrella fund for which the annual fee is based on the number of sub-funds.

A CSX listing is an inexpensive, efficient and effective way to add credibility, marketing value and a higher profile to a fund offering. If you wish to discuss listing on the Exchange, please contact the CSX Listing Department directly at csx@csx.com.ky

All CSX listing rules and other regulations are accessible for review on the CSX website at www.csx.com.ky

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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