This advisory summarises some key reminders regarding the upcoming government and regulatory filing deadlines in the Cayman Islands relating to Economic Substance, Beneficial Ownership and the Securities Investment Business (Amendment) Law, 2019.
Economic Substance
All Cayman Islands companies, limited liability companies, limited liability partnerships and registered foreign companies ("Entities") must file an annual economic substance notification ("ES Notification") regardless of whether or not they are "relevant entities" or claim an exemption from being a relevant entity by virtue of being an investment fund, tax resident in another jurisdiction or a domestic company. Partnerships and trusts do not have to file ES Notifications nor comply with any other economic substance requirements.
As summarised in our previous advisories, the Department of International Tax Co-operation ("DITC") has confirmed that ES Notifications are required to be filed via the General Registry and that such filing will be a prerequisite to filing an Annual Return on or before 31 January 2020.
Where Walkers Professional Services is the corporate services provider for your Entities, Walkers Professional Services and Walkers will work together to prepare the ES Notifications and will contact you if further information is required.
Where Walkers Professional Services is not the corporate services provider for your Entities and you would like assistance with your ES Notification obligations, please reach out to your usual Walkers contacts.
Our advisory with an overview of the economic substance requirements can be viewed here and subsequent advisories dated 19 June 2019, 02 August 2019 and 31 October 2019.
Beneficial Ownership
Further to our previous advisories on this topic, the Cayman Islands beneficial ownership regime is in force and steps need to be taken by all companies and limited liability companies to ensure compliance with the regime. The regime mandates that all Cayman Islands companies and limited liability companies must establish and maintain a non-public register of beneficial owners, unless they fall within an exemption.
Exempt companies and limited liability companies are required to provide their corporate services provider with written confirmation of the applicable exemption. Failure to do so may result in the entity being unable to file its Annual Return meaning that it will not be considered to be in 'good standing', financial penalties being imposed on the company and its directors, and restrictions being placed on the transfer of shares.
Where Walkers Professional Services is your corporate services provider, and if you have not done so already, please reach out to your usual Walkers contact to ensure that you are compliant with the regime.
For further detail relating to the beneficial ownership regime generally, please see our previous advisories dated 11 April 2017, 5 January 2018 and 8 March 2018.
Securities Investment Business (Amendment) Law, 2019 ("SIBL Amendment")
Pursuant to the SIBL Amendment, persons which carry on securities investment business but registered as excluded from SIBL's licensing requirements under Schedule 4 ("Excluded Persons") and which wish to continue conducting securities and investment business must re-register as "Registered Persons" with the Cayman Islands Monetary Authority ("CIMA") by 15 January 2020. Re-registration involves completing CIMA's application form (RRP-160-75 Application to Re-Register), which is accessible on the REEFS portal. Where Walkers Professional Services is the corporate services provider for your Entities, Walkers Professional Services and Walkers will work together to assist Excluded Persons in complying with the necessary requirements. For further information please contact SIBregistrations@walkersglobal.com.
Where Walkers Professional Services is not the corporate services provider for your Entities and you would like assistance with re-registration or registration as a Registered Person, please reach out to your usual Walkers contacts.
Annual Fees Payable to Registrar of Companies and Cayman Islands Monetary Authority
Annual registration and renewal fees are due to be paid to the Registrar of Companies and CIMA in January each year. Please ensure that all outstanding invoices from Walkers Professional Services are settled prior to 31 December 2019 to allow sufficient time for payments to be processed on your behalf.
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.
