Following a recent hearing, the Grand Court of the Cayman Islands (the "Grand Court") has handed down a notable judgment (the "Judgment") approving the remuneration of the Principal Liquidators of Herald Fund SPC (In Official Liquidation) ("Herald")1 incurred during a six-month period, the entire amount of which had been opposed by Herald's Liquidation Committee.

Introduction

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

After much anticipation, the UK Supreme Court has handed down its judgment in BTI 2014 LLC v Sequana S.A. [2022] UKSC 25 - and has authoritatively set the baseline for how directors’ duties evolve as regards shareholders and creditors’ interests when a company is in the zone of insolvency.

Background

2020 was a crippling year for the aviation industry. With daily cash burn running into the tens of millions of dollars for many airlines, access to liquidity has been critical as treasury teams and fleet managers juggle expenses with decimated revenue. Many governments pledged state aid but what has been delivered to date has simply not been enough.

The ‘Golden Goose’

The Grand Court of the Cayman Islands (Kawaley J) handed down a recent decision appointing receivers over a segregated portfolio, in the case of In the Matter of Green Asia Restructure Fund SPC[1].

The Grand Court of the Cayman Islands (the "Court") recently handed down a decision in the case of BDO Cayman Ltd. and BDO Trinity Ltd. v Ardent Harmony Fund Inc. (In Official Liquidation). This case provides helpful guidance on the exercise of the Court's discretion to grant leave to commence proceedings against a company in liquidation.

Background

The full strength of the economic headwinds facing the UK economy is not yet clear, but a helpful recent report by insolvency and restructuring adviser Begbies Traynor provided some useful numbers around the attitudes of businesses.

In a recent decision of the Grand Court of the Cayman Islands (the “Grand Court”) in the matter of Sun Cheong Creative Development Holdings Limited (FSD 160 of 2020), the Chief Justice considered the principles applicable to the appointment of “soft touch” provisional liquidators to effect the restructuring of a Hong Kong-listed Cayman Islands company where two competing winding up petitions were filed before the High Court of Hong Kong (the ("HK Petitions" and the “HK Court” respectively).

The much-anticipated and welcome reforms to the Cayman Islands restructuring and insolvency legislation will come into force on 31 August 2022.