Update on the Beneficial Ownership Regime

Since 1 July 2017, relevant Cayman Islands companies and LLCs (“Relevant Companies”) have been subject to a new beneficial ownership regime in the Cayman Islands (the “BO Regime”) which has required them to establish and maintain registers of their beneficial owners.

The Cayman Islands Government has recently made some further amendments to the legislation which implemented the BO Regime with some of the most noteworthy amendments being as follows:-

• entities which fall outside of the scope of the BO Regime (such as registered funds, general partners of registered funds etc.) will now be obligated to file a statement via their corporate services provider which confirms (i) the specific exemption they are relying on, and (ii) in relation to any regulated entity or approved person upon which the exemption relies, information confirming such status. Such statements will need to be filed on or before 30 June 2018 although we are still waiting for confirmation as to the form of such statement and how it will be filed;
• the exemptions to the BO Regime have been amended such that:-
  • an entity which holds, directly, a legal or beneficial interest in the shares of a legal entity that is licensed in the Cayman Islands where the conditions of such licence include full disclosure of the legal and beneficial owners of the licensee. This means that certain holding companies which were initially required to comply with the BO Regime, despite having an ‘out of scope’ wholly-owned subsidiary, may now not need to comply;
  • a person registered as an excluded person under the Securities Investment Business Act (2015 Revision) (an “Excluded Person”) will now be within the scope of the BO Regime (unless one of the other exclusions applies); and
  • an Excluded Person will no longer be considered an “approved person” for the purposes of any other entity seeking to rely on an exemption to the BO Regime.

We will be making contact with all of our clients to whom we provide registered office services to ensure that they are made fully aware of the implications of these changes to the BO Regime and what they need to do to comply with them.

See our last update on the Beneficial Ownership Regime.