The New Regime For Restructuring Officers | Cayman Islands Technical Brief for Investment Funds On 31 August 2022, the Cayman Islands introduced the restructuring officer regime (“the Regime”) by making certain amendments to the Cayman Islands Companies Act (“the Act”). In this arcle we consider the benefits of the Regime now that it has been in place for nearly twelve months, and how it is operang in pracce.

This article first appeared in Volume 20, Issue 1 of International Corporate Rescue and is reprinted with the permission of Chase Cambria Publishing - www.chasecambria.com.

Synopsis

This guide outlines the procedure for a voluntary liquidation of a solvent Cayman Islands exempted company and the duties of its liquidator. It also sets out the process for striking an exempted company off the Register of Companies in the Cayman Islands.

Voluntary liquidation

A Cayman Islands exempted company can be wound up voluntarily:

As year end approaches, it is time to start planning the liquidation of Cayman Islands entities that have reached the end of their life cycle to ensure that unnecessary fees are not incurred.

Introduction

The proposed introduction of a corporate restructuring regime in the Cayman Islands is a welcome development and is considered by many to be long overdue. Presently, Cayman Islands law does not provide for any formal corporate restructuring process; a position which can be contrasted with, for example, the United Kingdom and the United States whose respective “administration” and “Chapter 11 bankruptcy” processes have been available for many years.

Current Cayman Islands law

Voluntary liquidations generally

1. Related Fund Entity filings for private funds]

On 1 September 2021, the Cayman Islands Monetary Authority (CIMA) issued a Notice advising industry that a new Related Fund Entity (RFE) form for private funds was available for use via CIMA's Regulatory Enhanced Electronic Forms Submission (REEFS) portal.

This article considers the range of vehicles available in the Cayman Islands for alternative investment fund ("AIF") structures designed for financial institutions, pension funds, sovereign wealth funds, family offices and (U)HNWs (as opposed to retail investors), as well as the legal and regulatory considerations that may influence the structure of an AIF. A summary of the key similarities and differences between the regulation of closed-ended and open-ended AIFs in the Cayman Islands is also considered.

Cayman Islands AIF Vehicles

Voluntary liquidations generally

As year end approaches, it is time to start planning the liquidation of Cayman Islands entities that have reached the end of their life cycle, to ensure that unnecessary fees are not incurred.