Do you have Cayman fund vehicles that you intend to
If so, you may wish to initiate the process now to minimise or
eliminate 2017 fees.
How much could you save?
A CIMA registered Master/Feeder structure will typically incur
over US$10,000 in annual fees (in addition to its various service
provider fees) if its deregistration and liquidation has not been
commenced by December 30, 2016.
What are the key stages of a solvent liquidation?
The principal factors that will drive the timetable, and
therefore the fees, on the voluntary liquidation of a Cayman fund
(i) Date of final redemption
(ii) Date on which final redemption
proceeds are paid
(iii) Identity of liquidator
(iv) Statutory notice periods
(v) Date by which final audited
financial statements can be available
If you have a registered fund to be terminated in 2016, you
should get in touch with the fund's auditor and with Ogier as
soon as possible to ensure that the optimum approach can be
What is the best outcome for a CIMA registered fund planning to
terminate at year end?
If the final redemption date of a fund will be 12/30/16 and the
voluntary liquidator of the fund can be appointed on that date, it
may be possible to make necessary filings with CIMA to place the
fund into "Licence under Liquidation"
(LUL) status. A registered fund placed into
LUL status by 12.00pm (Cayman Islands time) on 12/30/16 will not
incur CIMA annual fees for 2017. The fund can then complete
its final audit in 2017 and once the audit, FAR form and FAR filing
fee have been filed with CIMA, the deregistration and voluntary
liquidation of the fund can be completed.
Notwithstanding LUL status, it will still be necessary for the
fund to pay fees to the Registrar of Companies (or Registrar of
Exempted Limited Partnerships, as applicable) and the registered
office provider for 2017.
What about a strike-off instead of a voluntary
A strike-off is a more cost effective and less time consuming
option but has the downside that it can be undone for a period of
10 years after the strike-off date. For this reason we
don't usually recommend this option where the entity in
question has taken in external investors and traded.
If a strike-off is a viable option you will need to have all
relevant materials filed before 12/30/16 to avoid 2017 fees.
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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