Benefits
There are many benefits to investing in the Cayman Islands, which offers a well-regulated, tax-neutral, offshore business environment. It has a stable government, sophisticated infrastructure and a developed judicial system based on English common law. Effective regulation and a wide range of experienced professional service providers contribute to the favourable business environment.
In addition, the main benefit of investing in Cayman remains that there is currently no income tax and no resident, capital gains or similar taxes in the Cayman Islands.
Types of businesses
A business in the Cayman Islands can be operated as a sole trader, as a partnership or in the form of a limited company. Sole trader operations are in practice limited to Caymanians and Caymanian status holders. The type of company will depend mainly on the nature of the business activity and whether this activity will be carried out locally or outside of the Cayman Islands.
Company types that may be formed in the Cayman include:
Resident companies, which are typically formed by those wishing to conduct business within the Cayman Islands. Resident companies must be at least 60 per cent majority-owned by a Caymanian.
Exempted companies are the most common and used when the proposed business activity of the company is to be carried out outside of the Cayman Islands. The non-resident company is an alternative to the exempted company. There are no restrictions on the nationality of the directors or shareholders of an exempted company and an exempted company is not required to hold an annual shareholders meeting.
Exempted limited duration companies preserve the limited liability to its members and offer the possibility in certain jurisdictions of advantageous treatment as a partnership. An LDC continues until the terminal time or an event specified in its Memorandum of Association. However, its duration must not exceed 30 years and it must have at least two members.
Segregated Portfolio Companies is a form of exempted company that initially developed for the insurance industry allows for the segregation of the assets and liabilities of individual portfolios or cells from the general assets of the overall company as well as from other portfolios.
Foreign companies are incorporated outside the Cayman Islands but carrying on business locally.
Certificate of incorporation
Memorandum and Articles of Association
Return of Shareholdings
Register of directors, officers and members
Proof that at least 60 per cent of the shareholders and at least 60 per cent of the directors of the company are Caymanian.
All non-Caymanian directors/members/officers of the business have to supply a character reference, a financial reference from a bank or other similar institution, a police clearance certificate from the place where the person concerned has lived for the previous six months and a copy of the individual's passport.
All applications and payments for trade and business licenses must be submitted to: The Trade and Business Licensing Office (see contact details bottom right)
Registration process
In order to establish a Cayman Islands company, an application must be made to the Registrar of Companies for company incorporation. The easiest way to register a company in the Cayman Islands is to employ one of the professional firms licensed for this purpose.
Applicants will first need to check with the Registrar if the desired company name is available. The basic information required for incorporation are the Memorandum and the Articles of Association subscribed by the proposed shareholders together with the applicable incorporation fee and revenue stamps.If the application is made for the registration of an exempted company, a duly signed and notarised affidavit must be enclosed.
The registration and annual fees vary according to the size of the share capital and depend on whether the company is non resident, resident, exempt etc. Contact Registrar of Companies (see contact details bottom right).
Trade and Business licence
Businesses wanting to operate on island require a Trade and Business Licence under the Local Companies (Control) Law. If the business is less than 60 per cent Caymanian-owned, the Trade and Business Licensing Board will have to be convinced of the need for the company’s services and its favourable impact on the local economy. However, non-local businesses are rarely granted a T&B licence.
A schedule of fees and the application form are available at immigration.gov.ky. The T&B Licence fee is payable every year and the application for renewal must be made at least 28 days before the anniversary of the grant of the T&B licence.
In order to encourage foreign investment and help local business through difficult economic times, the Cayman Islands has restructured several of its business licensing, investment and business assistance functions including the Trade and Business Licensing Office, into one agency. The new entity is the Department of Commerce and Investment and replaced the Cayman Islands Investment Bureau.
Contact details
Registrar of Companies
Ground Floor
Citrus Grove Building
Goring Avenue, GT
Ph: 946.7922
W: ciregistry.gov.ky
E: cigenreg@gov.ky
The Trade & Business
Licensing Office
Sussex House
Elgin Avenue
Ph: 244-2086
W: immigration.gov.ky