The Cayman Limited Liability Companies Law (`LLC Law') was formerly introduced on 8 July 2016 and is expected to be used for a broad range of structuring situations.  From a US manager's perspective, the Cayman LLC might be seen as an alternative to the Delaware LLC in setting up an investment management or advisory company or a General Partner for a Limited Partnership fund. A Cayman LLC could provide a useful synergy in a structure where Delaware entities are also used given that Cayman LLC Law is based on and uses many elements of the Delaware Limited Liability Company Act.

The US Foreign Account Tax Compliance Act reporting cycle has been running now for two years. As such there is a good level of visibility in terms of how this tax reporting exercise needs to be done and most financial institutions are clear on the definitions used.  But there is now a new tax reporting standard for fund managers to contend with that is global, as opposed to US-centric: The Common Reporting Standard.  Whereas financial institutions previously only had to report the tax status of their US investors, under CRS – of which the US is neither a signatory nor

The Cayman Government is currently proposing legislative changes which would give CIMA additional powers to impose administrative fines on licensed and regulated individuals and entities. The Monetary Authority (Amendment) Bill 2016 seeks to amend the Monetary Authority Law and if passed will enable CIMA to impose a range of penalties from non-discretionary fines of USD5,000 for a minor breach up to USD1 million for a serious breach. CIMA would be able to impose cumulative fines of up to USD20,000 for a single minor breach.  These would include breaches of prescribed provisions of regulatory laws and money laundering regulations as pertaining

As global asset management groups increasingly adopt digital platforms to connect with counterparties and investors in today's knowledge-based economy, the risks of cybersecurity threats are rising. Funds of all shapes and sizes are susceptible to fraud committed internally by employees or external criminal groups – hactivists, terrorist groups – which can have a potentially devastating impact on shareholders, oblivious to the risks. This could lead to investors losing part or all of their investment while ongoing criminal investigations and court procedures play out. As such, the Money Laundering Reporting Officer (MLRO) is becoming a vital role in the operations of

In 2018, the National Private Placement Regime pathway to access European investors is scheduled to be phased out. But given that ESMA is yet to approve the next wave of jurisdictions to qualify for the AIFMD third country passport, this seems an unlikely timeframe. "Given that ESMA still has to review amendments to Cayman legislation and provide its approval, there is a long road ahead and 2018 really isn't that far away. I am of the view that NPRR will likely be extended a year or two to allow jurisdictions such as Cayman and the US to be properly considered

By Leon den Exter (pictured) & Vumi Dube, DMS Governance – A professional director for a hedge fund might take an instinctive view that board observer rights are not desirable given the traditional view of separation of capital ownership and those responsible for fund governance. Professional directors confident in their abilities would, however, welcome the opportunity to show how seriously they take their fiduciary responsibilities and demonstrate their skills and knowledge of good governance under the scrutiny of a board observer.  A board observer can take different forms but the general idea is that an investor would have the right to

By Chris Humphries, Stuarts Walker Hersant Humphries – The Cayman Islands is a transparent International Financial Centre which complies with all global standards on tax transparency and information exchange and whose financial services industry seeks to achieve the highest levels of professional conduct in order to service its core markets in a manner which is at all times: consistent with the high expectations of the Cayman Islands regulators; in accordance with the Cayman Islands laws and established best practices; and, to the extent possible, beyond reproach by its counterparts (and their respective regulators, law makers and governing bodies) in the traditional major financial centres around the world. In furtherance