CAYMAN ISLANDS Law and Practice Contributed by: Norman Klein and Adam Johnson, Appleby
gy and recycling infrastructure that will signifi - cantly reduce the amount of new landfill. Rising inflation and associated increase in inter - est rates have certainly impacted developers, whose construction and carrying costs have increased significantly over the past 12 months. This has led to increased prices for end-buyers, a more innovative approach to value-engineering and a rise in private financing clubs to replace or supplement traditional bank borrowing. 1.3 Proposals for Reform At the time of writing, there are proposals to reform the law applicable to mortgage enforce - ment, which will create a more consumer-friend - ly environment for those securing financing over Cayman Islands real estate. There are also longstanding proposals to mod - ernise the Strata Titles Registration Act (2013 Revision) and update the Development Plan 1997. The Cayman Islands Land Registry continues its work to implement e-conveyancing, and plans to propose a number of legislative initiatives to further streamline the land registration process. Proposals to increase the stamp duty applicable to real estate transactions in higher value areas of the jurisdiction, announced in Q4 2023, were in Q1 2024 put under further review.
The Strata Titles Registration Act (2013 Revision) allows for the registration of a strata plan against a freehold or leasehold land parcel to create indi - vidual strata lots, each of which is registered with its own derivative title and the remainder held as “common property” by a strata corpora - tion. Strata titles are often used as a mechanism to govern multi-unit developments such as office buildings, shopping centres and condominium developments. The Registered Land Act (2018 Revision) allows for the registration of a volumetric plan against a land parcel, whereby a parcel can be subdivided into several three-dimensional parcels (which can include airspace). A contractual licence can allow for the occupa - tion or use of real property. However, this is a personal right and does not create a registerable interest. 2.2 Laws Applicable to Transfer of Title All transfers of title of real estate are primar - ily governed by the Registered Land Act (2018 Revision). While not specifically related to the transfer of title, the carrying on of business from real estate within the Cayman Islands requires certain local licences, some of which are specific to property type. 2.3 Effecting Lawful and Proper Transfer of Title Transfers of real estate must be registered at the Cayman Islands Land Registry. Broadly speaking, the land register is defini - tive and is supported by a government-backed indemnity (although it can be rectified to deal with matters such as error and fraud). Title insur - ance is available only on the larger commercial transactions, but it is expensive and rarely used.
2. Sale and Purchase 2.1 Categories of Property Rights
Real property can be held as freehold (held by the registered proprietor indefinitely) or lease - hold (held by the registered proprietor for the term of the lease).
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