CAYMAN ISLANDS Law and Practice Contributed by: Christie Walton, Patrick Rosenfeld and Philip Dickinson, Maples Group
Maples Group Ugland House South Church Street PO Box 309 Grand Cayman KY1-1104 Cayman Islands Tel: +1 345 949 8066 Fax: +1 345 949 8080 Email: info@maples.com Web: www.maples.com
1. Market Overview 1.1 State of the Market
2. Alternative Investment Funds 2.1 Fund Formation 2.1.1 Fund Structures Entity options available for structuring invest - ment funds include exempted limited partner - ships, exempted companies, limited liability companies and unit trusts. Closed-ended funds (such as private equity, credit and venture capital funds) are typically structured as exempted limit - ed partnerships, and open-ended funds (such as hedge funds) make use of both exempted com - pany and exempted limited partnership vehicles in standalone and master-feeder structures. Cayman Islands unit trusts are also frequently used as investment vehicles for investors in Asia, including China and Japan. The limited liability company is a popular choice for general partner and/or downstream holding vehicles. A key difference between an exempted limited partnership and an exempted company is that, notwithstanding registration, an exempted lim - ited partnership is not a separate legal person distinct from its partners. An exempted limited partnership must act through its general part - ner, and all agreements and contracts must be entered into by or on behalf of the general
The Cayman Islands is a popular domicile for globally managed private equity, credit, hedge and hybrid funds due to its tax neutral status, its flexible structuring options and its established and experienced financial services sector and professional service providers. Additionally, the Cayman Islands is recognised as an attractive jurisdiction for investment funds due to its Eng - lish-based legal system, its established judiciary and the absence of political or sovereign con - cerns. In particular, the Cayman Islands is the jurisdic - tion of choice for US sponsors structuring funds for US tax-exempt investors and non-US inves - tors. Cayman Islands unit trusts and other vehi - cles are frequently used as investment vehicles for investors in Asia, including China and Japan. The majority of investment funds established in the Cayman Islands are private non-retail funds.
73
CHAMBERS.COM
Powered by FlippingBook