CAYMAN ISLANDS Law and Practice Contributed by: Agnes Molnar, Jason Ta, Paul Walters and Gemma Walters, Travers Thorp Alberga
Registered Office Provider As a matter of the laws of the Cayman Islands, the only requisite Cayman Islands-based admin - istrative provider is a registered office provider. However, for tax and other reasons, the SPE will typically appoint Cayman Islands-domiciled cor - porate service providers and/or administrators to provide directorships, legal, regulatory and compliance assistance. 1.3 Applicable Laws and Regulations The principal laws and regulations of the Cay - man Islands that impact the majority of secu - ritisations can broadly be divided into two cat - egories: • laws in respect of the establishment and incorporation of SPEs; and • laws in respect of ongoing compliance. Establishment and Incorporation of SPEs The Companies Act (2023 Revision), as amend - ed, of the Cayman Islands (the “Companies Act”) is likely to be the most relevant instrument for most SPEs. Ongoing Compliance One or more of the following laws and regula - tions (as amended, in each case) are likely to be relevant: • Anti-Money Laundering Regulations (2023 Revision) (together with the Guidance Notes on the Prevention and Detection of Money Laundering, Terrorist Financing and Prolifera - tion Financing in the Cayman Islands (the “Guidance Notes”)) (AMLRs); • Beneficial Ownership Transparency Act, 2023; • Beneficial Ownership Transparency Regula - tions, 2024; • Data Protection Act (2021 Revision);
• Proceeds of Crime Act (2024 Revision) (the “POCA”); • Tax Information Authority (International Tax Compliance) (United States of America) Regulations; and • Tax Information Authority (International Tax Compliance) (Common Reporting Standard) Regulations (2021 Revision). All Cayman Islands persons (which will include an SPE) are required to observe Cayman Islands sanctions provisions. The list of sanctions regimes currently in force in the Cayman Islands is available on the Financial Reporting Authority website. The listing rules of the CSX (including applicable disclosure requirements) will apply if the debt securities are listed on the CSX. See 3.8 Bonds/ Notes/Securities . All Cayman Islands persons (which will include an SPE) are required to file electronically with the Registrar of Companies a notification regarding their status under the International Tax Coopera - tion (Economic Substance) Act (the “ES Act”). Relevant entities engaged in relevant activities are also required to satisfy the economic sub - stance test under the ES Act and to file an annu - al report with the Cayman Islands Tax Informa - tion Authority concerning compliance with the economic substance test. A securitisation SPE is likely to fall within the definition of an “invest - ment fund” under the ES Act, which means it will not be a relevant entity, and will not there- fore have to satisfy the economic substance test under the ES Act. As a matter of the laws of the Cayman Islands, an SPE is unlikely to be registerable under the Mutual Funds Act or the Private Funds Act.
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