In Part 1 of this two part series, it was mentioned that Cayman’s new Beneficial Owner Regime (comprised of The Companies (Amendment) Law, 2017, the Beneficial Ownership (Companies) Regulations, 2017, The Limited Liability Companies (Amendment) Law, 2017 and the Beneficial Ownership (Limited Liability Companies) Regulations, 2017 which came into effect on 1 July 2017) requires certain Cayman companies to establish and maintain a beneficial ownership register setting out certain required particulars of registrable persons (as defined in the Beneficial Owner Regime). Details of these required particulars are described below.

Details of Required Particulars

Under the Beneficial Owner Regime, required particulars must be confirmed to the Cayman company which is subject to the Beneficial Owner Regime. These required particulars may vary according to the person or entity for which the particulars are being confirmed to the Cayman company. These are summarised below.

For Individuals

(a) full legal name

(b) residential address

(c) an address for service of notices

(d) date of birth

(e) information identifying the individual from their passport, driver’s licence or other government-issued document, including (1) identifying number (2) country of issue and (3) date of issue and of expiry

(f) the date on which the individual became or ceased to be a registrable person in relation to the company in question

For A Corporation Sole, Government or International Organization

(a) name

(b) principal office

(c) the legal form of the person and the law by which the person is governed

(d) the date on which the person became or ceased to be a registrable person in relation to the legal entity in question

For Relevant Legal Entities

(a) corporate or firm name

(b) registered or principal office

(c) the legal form of the entity and the law by which it is governed

(d) if applicable, the register of companies in which it is entered and its registration number in that register

(e) the date on which it became or ceased to be a registrable person in relation to the company in question.

Particulars Submitted To Corporate Services Provider

Once the above required particulars are confirmed to the Cayman company, the Cayman company (which falls within the ambit of the Beneficial Owner Regime), the company shall provide in writing to a corporate services provider or to the Registrar, as the case may be, the required particulars of registrable persons in respect of that company.

The company shall then instruct the corporate services provider or the Registrar, as the case may be, to enter the required particulars of registrable persons in the company’s beneficial ownership register in the prescribed form and manner (to be kept at the company’s registered office), or if no registrable persons are identified to enter a nil return. Under the Beneficial Owner Regime, particulars need not be entered concerning an individual or relevant legal entity that is not a registrable person.

Company Must Keep Register Up To Date

If a Cayman company (which falls within the ambit of the Beneficial Owner Regime), becomes aware of a relevant change with respect to a registrable person whose required particulars are stated in its beneficial ownership register, the company shall give notice to the registrable person, as soon as reasonably practicable after it learns of the change or first has reasonable cause to believe that the change has occurred, requesting confirmation of the change.

If the person to which a notice is sent confirms the relevant change (such relevant change taking place where a registrable person ceases to be a registrable person in relation to the company or where any other change occurs as a result of which the required particulars stated respecting the registrable person in the company’s beneficial ownership register are materially incorrect or incomplete), the company shall record the details of the change and instruct the corporate services provider or the Registrar, as the case may be, to enter in the company’s beneficial ownership register in the prescribed form and manner (a) the details of the relevant change confirmed by the company (b) the date on which the change was made and (c) whether there are further alterations to be made.

For the purpose of the foregoing, a relevant change with respect to a registrable person is considered to have been confirmed if (a) the company has given notice to the person requesting confirmation, within the period of one month from the date of the notice, of the relevant change, the date of the change and the required particulars included in the notice and (b) the details, date and particulars of the change have been supplied or confirmed to the company by the registrable person, or by another person, with the knowledge of the registrable person.

Summary

This two part series described the reasonable steps required to be taken by Cayman companies who fall within the ambit of the Beneficial Owner Regime, their obligation to establish and maintain a beneficial ownership register in accordance with the Beneficial Owner Regime and the required particulars that must be confirmed to the relevant Cayman company and inserted in the beneficial ownership register. Due to the recent implementation of the Beneficial Owner Regime, it is expected that many clients will have questions regarding compliance with the Beneficial Owner Regime. In such a case where the relevant management of a Cayman company is unclear whether the company is subject to the Beneficial Owner Regime or where there are questions about beneficial owners or relevant legal entities, the company should seek the guidance of Cayman Islands legal counsel.

About the Author

Alric Lindsay is a Cayman Islands corporate/funds lawyer and an independent fund director approved by the Cayman Islands Monetary Authority and licensed under The Directors’ Registration and Licensing Law. Alric also acts as voluntary liquidator to Cayman Islands entities. Alric can be contacted at alric@caymanfs.com