Guernsey pioneered the cell company concept and the success of this innovation is illustrated by the fact that it is now used across the financial services world as an alternative application for the structuring of products.


The cell company was pioneered when Guernsey introduced the Protected Cell Company (PCC).

In a conventional company all of the assets and liabilities are linked, risking that the failure of one part can lead to the loss of assets related to another. A PCC is one company made up of a core and individual cells, where the legal segregation ensures that the assets and liabilities of one cell are kept separate and protected from the assets and liabilities of the other cells, as well as from the PCCs non-cellular assets and creditors.

The fact that the PCC has since been adopted by many jurisdictions around the world is evidence of the success of Guernseys innovation. However, it is Guernsey which has developed expertise in using the structure.

The Island has also adopted the innovative Incorporated Cell Company (ICC) structure. An ICC has cells like a PCC but they are distinct entities, with potential advantages in terms of added protection. In addition, they offer greater flexibility for example a cell can leave the umbrella of an ICC and convert into an ordinary company.


The cell company was actually developed to encourage the use of captive insurance: the structure reduces the risk in captive sharing (which is itself more economically viable than establishing a traditional captive); and allows the various parts of one institutions business to be written into separate cells. In addition, cell companies can be used as vehicles for direct access to the reinsurance market.


Cell companies are also now established among promoters of investment funds, where each cell can run a distinct investment programme. In addition, in terms of economies of scale, they are more cost effective to establish than individual funds. The segregation of assets and liabilities means that PCCs readily lend themselves to being used as guaranteed or protected products and can be used to form special purpose vehicles (SPVs) for securitisation transactions.


Cell companies are now being increasingly used in the wealth management sphere in terms of Private Trust Companies (PTCs) and family office solutions; family governance and succession planning; private investment funds; real estate ownership; intellectual property and royalty ownership; and tax planning.

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