Funds professionals will need to adjust to changes to Cayman’s beneficial ownership transparency regime following the approval of a new act, with adjustments expected to be rolled out from May 2024.

The Cayman Islands legislature has approved the Beneficial Ownership Transparency Act, 2024, as a restatement and enhancement of Cayman’s beneficial ownership regime.

Regulations and guidance notes to support the Act have been in development through the first quarter of 2024 and industry is being consulted. The implementation of the Act is now expected to commence, on a phased basis, from May 2024. Its full implementation is scheduled for the end of 2024; compliance with the new beneficial ownership regime will be required by 1 January 2025.

Although some details of the Act’s implementation are being refined and it is not yet in force, the timeframe for its implementation has been communicated. As such, we advise that all Cayman entities should begin assessing how the Act will apply to them.

It should also be noted that the new regime will be extended to some entities previously excluded including partnerships, including exempted limited partnerships and entities which are registered with the Cayman Islands Monetary Authority under a regulatory law such as the Securities Investment Business Act or the Virtual Asset (Service Providers) Act).

Other exemptions, for example, for funds registered under the Mutual Funds Act or the Private Funds Act, have also been removed. Instead, registered funds will be able to utilise an ‘alternative route’ to comply, details of which are set out in the Act.

 

For help and information on the implications of the Act, please contact the Paradigm team.