Establishing a Cayman Islands company provides attractive advantages to businesses, investors and entrepreneurs, particularly those with international business interests or who may benefit from a company structure to hold and manage high value assets.
With a strong yet dynamic and adaptable legal and regulatory framework, tax neutrality, connections to the UK, a thriving ecosystem of high quality professional advisers and a range of flexible structuring options, it is little wonder that the number of companies registered in the Cayman Islands has grown steadily in recent years to reach almost 120,000.
Company options
There are a wide range of company structures which are available in the Cayman Islands, which has been enhanced by the ongoing development of the Special Economic Zone, Cayman Enterprise City.
- Exempt companies. Representing around 81% of registered Cayman companies, the most common choice for businesses whose activities are carried out mainly outside of the Cayman Islands. Exempted companies are either Limited Duration or Segregated Portfolio.
- Foundation companies. Often considered as an alternative to trusts, they hold separate legal personality and can be attractive to clients from civil law jurisdictions where trusts are less common, or to operate as part of a wider family office or family business structure.
- Limited Liability Companies. Comparatively new, entering into effect via the 2016 LLC Act, providing a flexible alternative to the traditional company broadly comparable to the Delaware LLC.
- Ordinary (Non-Resident and Resident) companies. The standard alternative to the Exempt company, with a primary difference being that the company must maintain a public register of members at its registered officed – including names and addresses -and must hold an AGM. Non-resident companies must declare that they will not carry on business in the Cayman Islands. Resident companies are permitted to trade in the Cayman Islands.
- Foreign/overseas companies. Companies which are incorporated outside of the Cayman Islands, but which carry on business or hold land in the Cayman Islands are required to register with the Registrar.
- Special Economic Zone company. SEZ companies are specifically authorised to carry on business only within the SEZ (Enterprise City) free zone, including trading with other SEZ businesses. They are not permitted to carry on business elsewhere in the Cayman Islands. Entities operating across a number of designated sectors are permitted to establish an SEZ company, including: Internet and Technology, Media and Marketing, Commodities and Derivatives, BioTech / Lifesciences and Green Tech, and Maritime / Aviation Services.
- Unlimited company: A private company structure where members / shareholders have non-limited obligations to settle any outstanding debts of the company in the event of winding up. Such structures are likely to be most useful where there is little to no risk of insolvency and where a company vehicle is required for a specific, and potentially short term, transaction.
Company formation and administration
One of the key benefits of establishing a Cayman Islands company is the relatively straightforward, and quick turnaround, nature of the process.
Incorporation can be undertaken within a matter of days, indeed within 24hrs upon payment of a modest express service fee.
Except in the case of Ordinary companies, the only publicly available information in respect of a company is its name, company number, date of incorporation, registered office, the type of company and whether the company is active or has been struck off.
However, all companies incorporated in the Cayman Islands are subject to the continuing obligations set out in the Companies Act and are required to maintain statutory books. Such statutory books are the legal records of the company and the information therein, ranging from copies of share certificates to constitutional documents, must be diligently maintained and upon request.
These requirements form part of the Cayman Islands’ robust approach to anti-money laundering and economic substance which, taken together, provide for its stable and internationally well-regarded financial industry and wider business environment.
Contact us to find out more about our full suite of corporate services in the Cayman Islands, including company formation and registered office provision, corporate governance and economic substance, company secretarial and ongoing compliance and regulatory liaison services.
