CAYMAN ISLANDS Law and Practice Contributed by: Norman Klein and Adam Johnson, Appleby
6. Commercial Leases 6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time There are two types of arrangements that allow a person, company or other organisation to occupy and use real estate for a limited period without buying it outright. • A lease grants a tenant the right of exclu - sive possession of a property for a specified period of time. It gives a tenant contractual and proprietary rights in the property, which can typically be transferred to a third party, subject to any restrictions in the lease. • A licence allows a landowner to grant permis - sion for the use and occupation of a property. The occupier of a property does not have exclusive possession, however, and their rights under the licence cannot be trans - ferred. A licence is merely a personal right and does not create a registrable interest. 6.2 Types of Commercial Leases There are no specified types of commercial leas - es. Given the relatively small size of the jurisdic - tion, there are relatively few sophisticated land - lords of large-scale developments, so landlords use their own form of lease. Most commonly, leases of part will be for a net rent, with a separate common area maintenance charge levied for landlord insurance, the mainte - nance of common parts, etc. Leases of whole are less common but would often impose full repair and insurance obliga - tions on the tenant. Freehold title to a portion of the valuable Seven Mile Beach corridor is owned by the Crown.
amounts of capital. However, the majority of commercial real estate is held privately. 5.4 Minimum Capital Requirement There are no minimum capital requirements for a Cayman Islands company. 5.5 Applicable Governance Requirements The subscribers of the memorandum of associa - tion of a Cayman Islands company are deemed to have agreed to become shareholders of the company, and every other person who has agreed to become a member of a company and whose name is entered on the register of mem - bers will be deemed to be shareholders of the company. The company will typically have one or more directors who manage the day-to-day business of the company. The constitutional documents set out the governance framework, along with the Companies Act (as revised). 5.6 Annual Entity Maintenance and Accounting Compliance Cayman Islands companies are obliged to pay annual fees in January to the Cayman Islands General Registry. A schedule of incorporation and annual fees levied by the Cayman Islands government for different types of company can be found on the Cayman Islands General Registry website. Exempted companies and foreign companies are required to engage a registered office pro - vider in the Cayman Islands, for which additional annual fees will apply.
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