In July, 2017 the Cayman Islands introduced a series of laws and regulations1 (the "Laws") which require all Cayman Islands companies and limited liability companies (LLCs) to take reasonable steps to identify, record and maintain the details of all 'beneficial owners' defined as including any individuals who hold, directly or indirectly, more than 25% of the shares, capital, voting rights or the right to appoint or remove a majority of the directors or managers of the company or LLC. The Laws also treat as beneficial owners those persons who have the right to, or actually do, exercise significant influence or control over the company or LLC and also apply in relation to a trust where the trustees qualify as beneficial owners and to any persons who have the right to, or actually do, exercise significant influence or control over the trust.
Companies and LLCs have to identify, record and maintain the details of certain intermediate structures incorporated, formed or registered in the Cayman Islands and which would be a beneficial owner were it an individual, referred to as 'relevant legal entities'.
Who is exempt from the requirements and what must they now do?
Previously there were a number of exemptions from the requirements of the Laws. They do not apply to partnerships including limited partnerships, nor do they apply directly to foreign companies2. They also do not apply to companies or LLCs which are, or are a subsidiary of, entities
listed on the Cayman Islands Stock Exchange or an 'approved stock exchange'3; registered or holding a licence under a 'regulatory law'4; (but now, not including excluded persons under the Securities Investment Business Law (2015)) managed, arranged, administered, operated or promoted by an approved person5 as a special purpose vehicle, private equity fund, collective investment scheme or investment fund; general partners of a vehicle, fund or scheme referred to in paragraph (c) that are managed, arranged, administered, operated or promoted by an approved person; or exempted by the regulations. On 13 December, 2017, the Companies (Amendment) (No. 2) Law, 2017 and the Limited Liability Company (Amendment) (No 3) Law, 2017 (the "Amendment Laws") came into force further extending the category of entity that is exempt by including those entities (and subsidiaries of one or more of those entities);
which are regulated in a jurisdiction included in a list published by the Anti-Money Laundering...