Skip to main content

Deadlines to register Cayman Islands investment funds approaching

Back Arrow Back

Deadlines to register Cayman Islands investment funds approaching

Managing Partner, Kendra Foster and Vice President – Fiduciary Services, Todd Hazlewood outline the key regulatory requirements and next steps for operators of Cayman Islands investment funds ahead of the deadline to register funds with the Cayman Islands Monetary Authority (CIMA). 

  Private Funds Law, 2020 Mutual Funds (Amendment) Law, 2020
Detail

As detailed in our previous client note which can be found here, the Private Funds Law, 2020 of the Cayman Islands (the Private Funds Law) has now been enacted and governs certain closed-ended investment funds that fall within the definition of a private fund under the Private Funds Law (Private Fund). The Private Funds Law requires that these Private Funds register with CIMA.

As detailed in our previous client note which can be found here, the Mutual Funds (Amendment) Law, 2020 of the Cayman Islands (the Mutual Funds Law) has now been enacted and governs certain closed-ended investment funds that fall within the definition of a limited investor fund, previously known as a section 4 fund (Limited Investor Fund). The Mutual Funds Law requires that these Limited Investor Funds register with CIMA.

Deadline New and existing Private Funds have until 7 August 2020 to register with CIMA. The operator of a Private Fund is responsible for ensuring that such Private Fund complies with the Private Funds Law. If it is determined that a person has contravened the requirement to register a private fund under the Private Funds Law, such person will be liable on conviction to a fine of approximately USD 121, 950. Existing Limited Investor Funds have until 7 August 2020 to register with CIMA. All new Limited Investor Funds need to register with CIMA immediately. The operator of a Limited Investor Fund is responsible for ensuring that such Limited Investor Fund complies with the Mutual Funds Law. If it is determined that the Limited Investor Fund has not complied with the Mutual Funds Law, the operator will be liable on conviction to a fine of approximately USD 121,950.
CIMA fees and process Private Funds are required to submit a registration application to CIMA accompanied by an application fee of approximately USD 366. Each Private Fund will also be subject to annual fees of approximately USD 4,268. However, if registered before 7 August 2020, a Private Fund will not be required to pay the annual fee for 2020 and the first annual fee will be due on or before 15 January 2021. Any Private Fund registering on or after 8 August 2020 will be required to pay an annual fee for 2020 in addition to the application fee.  Limited Investor Funds are required to submit a registration application to CIMA accompanied by an application fee of approximately USD 366. Each Limited Investor Fund will also be subject to annual fees of approximately USD 4,268. However, if registered before 7 August 2020, a Limited Investor Fund will not be required to pay the annual fee for 2020 and the first annual fee will be due on or before 15 January 2021. Any Limited Investor Fund registering on or after 8 August 2020 will be required to pay an annual fee for 2020 in addition to the application fee. 

What should I do now?

All operators of Limited Investor and Private Funds must make arrangements to register their funds with CIMA prior to the deadline and we suggest reaching out to us sooner rather than later as CIMA has not given any indication that they will be extending the registration deadline as of today’s date.

Our legal team is ready to assist with any classification and registration requirements. In order to ensure that your investment fund is compliant with the new regulation, please contact us at [email protected] or via our profiles below to discuss next steps.

You may also like

24 February 2020

Reading time: 11 minutes

Implications of Cayman Islands' new Private Funds Law and amended Mutual Funds Law

Managing Director - Cayman Islands, Richard Gordon and Managing Partner, Kendra Foster walk throug...

Read more

07 April 2020

Reading time: 9 minutes

Extensions granted for filings in the Cayman Islands

In light of the COVID-19 pandemic and its implications on business continuity in the financial ser...

Read more

06 April 2020

Reading time: 5 minutes

Risk profiling, pricing and value in infrastructure investing (pt.1)

In the latest installment of Head of Real Estate and chartered surveyor Simon Burgess' overview of...

Read more