Cayman Funds Newsletter - June 2014

Foreign Account Tax Compliance Act

(US) FATCA are regulations which require financial institutions outside the US to report information on financial accounts held by their US customers to the Inland Revenue Service (“IRS”). The information to be reported is equivalent to that required to be reported by the US citizens in their US tax returns.

Revised Exempted Limited Partnership Act

The revised law applicable to Exempted Limited Partnerships (“ELPs”), the Exempted Limited Partnership Act (2014 Revision) (the “Law”), is expected to come into force shortly. The purpose of the revised Law is principally to enhance Cayman’s partnership formation framework by providing much more contractual flexibility and to help align the drafting of a Cayman Islands partnership agreement with that of an onshore partnership in, for example, master/feeder structures.

New Cayman Islands Structure Proposed

A new law has been proposed in the Cayman Islands to permit the formation of a new type of vehicle, an exempted limited liability company (“ELLC”).

The Cayman Islands Director Registration and Licensing Act, 2014

The Cayman Islands’ Director Registration and Licensing Act, 2014 (the "Law") affecting all directors of regulated funds and managers came into force on 4 June 2014 (except the sections which relate to a Director’s capacity to carry out his duties as a Director) following the approval by the Cabinet of The Director Registration and Licensing (Regulation and Licensing) Regulations, 2014.

The Contracts (Rights of Third Parties) Act, 2014 comes into effect

The Contracts (Rights of Third Parties for the registration of a Director) Act (2014 Revision) (the “Law”) came into effect on 21 May 2014.The Law brings the Cayman Islands into line with the UK and the US in relation to the ability of a person to enforce rights which are conferred upon him pursuant to a contract to which he is not a party (“third party”), thereby overriding the common law principle that only parties to a contract are able to enforce its terms.

Investments and Securities

Read the latest Licences / Registrations figures in effect in the Cayman Islands

Cayman Islands signs Tax Information Exchange Agreement with Seychelles and Belgium

The Cayman Islands and Seychelles officially signed a tax information exchange agreement "TIEA" on 12 February 2014.The Cayman Islands and Belgium have officially signed a tax information exchange agreement "TIEA" on 24 April 2014.

The Cayman Islands Monetary Authority appoints new head of Investments and Securities Division

The Cayman Islands Monetary Authority (CIMA) has appointed Heather Smith, the deputy head of its Investments and Securities division as the head of the unit following the resignation of Yolanda McCoy on 1 June 2014.