Introduction
The Cayman Islands beneficial ownership regime, which came into force on 1 July 2017, requires Cayman Islands companies and limited liability companies to establish and maintain beneficial ownership registers (BO Registers) unless they fall within an exemption.
The BO Registers maintain details of each qualifying beneficial owner as ‘Registrable Persons’, and must be kept at their regulated corporate services provider registered office in the Cayman Islands[1].
Penalties
A company that knowingly and wilfully fails to establish or maintain a BO Register or fails to fulfil its duties in relation to identifying beneficial owners and relevant legal entities, notifying Registrable Persons, disclosing beneficial ownership and keeping the BO Register up to date, shall be liable on summary conviction to a fine of CID25,000/USD30,000 for each contravention, increasing to CID100,000/USD120,000 upon conviction of second or subsequent offences.
Where it is proved that the offence was committed with the consent or wilful default of directors or officers of the company, then those officers are also guilty of the same offence and liable to the same penalty as the company.
Changes to Beneficial Ownership threshold
The scope of beneficial ownership in the Cayman Islands has now been widened for the purposes of determining the thresholds that qualify a Registrable Person.
The definition of a beneficial owner in the Companies Law (Revised) and the Limited Liability Companies Law (Revised) will change on 15 May 2020 from “more than 25%” of the shares or voting rights in a company to “twenty-five per cent (25%) or more” of the shares or voting rights in a company.
Deadline
The deadline to file BO Registers amended to capture additional beneficial owners according to the new legal definition is now 15 May 2020 (further to a previous extension).
Marbury clients for whom the change may entail a change in the BO Register will be contacted directly.
Should you have any queries or require assistance with maintenance of your Cayman company, please liaise with your usual Marbury contact or contact us via info@marburys.com.
[1] See our original article about the Cayman Islands beneficial ownership regime.