Harneys British Virgin Islands


Cayman Islands Beneficial Ownership Regime - Frequently Asked Questions


Cayman Islands exempted companies and limited liability companies must engage a regulated corporate services provider to establish and maintain a register of their beneficial owners (Beneficial Ownership Register). From 1 July 2017, if engaged the corporate services provider is required to provide the Beneficial Ownership Register to the Competent Authority on a monthly basis. 

Why was the Beneficial Ownership Regime introduced?

The introduction of the Beneficial Ownership Register was as a result of changes made to the Companies Law, the Limited Liability Companies Law and the Companies Management Law.

The implementation of these changes demonstrates the Cayman Islands’ continued commitment to meeting the highest standards of due diligence and transparency.

Does my company need to have a Beneficial Ownership Register?

All Cayman Islands companies incorporated or registered by way of continuation in the Cayman Islands under the Companies Law and limited liability companies formed under the Limited Liability Companies Law must establish and maintain a Beneficial Ownership Register except a company (or a subsidiary of a company) that is:
  • listed on the Cayman Islands Stock Exchange or an approved stock exchange;
  • registered or licensed under regulatory legislation in the Cayman Islands;
  • managed, arranged, administered, operated or promoted by an “approved person” as a special purpose vehicle, private equity fund, collective investment scheme or investment fund; or
  • a general partner of special purpose vehicles, private equity funds, collective investment schemes or investment funds each of which must be managed, arranged, administered, operated or promoted by an approved person.

Who is “registrable person” on the Beneficial Ownership Register?

In relation to a company, any beneficial owner (including any “deemed beneficial owner”) that, directly or indirectly, meets one of the following specified conditions:
  • holds, in aggregate, more than 25 per cent of the shares or membership interests in the company;
  • holds, in aggregate, more than 25 per cent of the voting rights in relation to the company;
  • holds, in aggregate, the right to appoint or remove a majority of the board of directors/managers of the company;
  • has the absolute and unconditional legal right to exercise (or actually exercises) significant influence or control over the company ; or
  • exercises significant influence or control over the activities of a trust or other vehicle, other than solely in the capacity of a director (or manager), professional advisor or professional manager.

Any legal entity incorporated, formed or registered in the Cayman Islands (“relevant legal entity”) which holds an interest in the company or meets one or more of the specified conditions directly in respect of that company and through which any beneficial owner or relevant legal entity indirectly owns an interest in the company.

What is a “deemed beneficial owner”?

The legislation provides that certain types of vehicles which are not individuals are deemed beneficial owners, if they are: 
  • a corporation sole;
  • a government or government department of a country or territory or a part of a country or territory;
  • an international organisation whose members include two or more countries or territories (or their governments); or
  • a local authority or local government body.

What information must be put on the register in respect of registrable persons?

For a beneficial owner:
  • Name
  • Date of birth
  • ID type, number, date of issue, date of expiry and country of issue
  • Physical address
  • Service address (if different than physical address)
  • Date on which the individual became registrable
  • Date on which the individual ceased to be registrable 
For a legal entity:
  • Name
  • Incorporation/registration number
  • Legal form
  • Governing law
  • Physical address
  • Service address (if different than physical address)
  • Date on which it became registrable
  • Date on which it ceased to be registrable

How do we classify a registrable person?

If in doubt, please liaise with your usual Harneys contact.

Do we need to provide supporting documents together with our Beneficial Ownership Register?


What if the company does not have any registrable persons or needs to make further enquires?

To facilitate the company’s compliance with its legal obligations, the legislation provides that a Beneficial Ownership Register may state any of the following:
No registrable person identified” which applies  when:
  • the company knows or has reasonable cause to believe that there is no registrable beneficial owner or relevant legal entity in relation to the company; or
  • the company has taken reasonable steps to identify all beneficial owners and relevant legal entities and has not, in the course of taking such steps, been able to identify any registrable person.

“Enquiries Pending” which applies when the company is still in the process of taking reasonable steps to find out if there is anyone who is a registrable person in relation to the company.
Confirmations Pending” which applies when the company has identified registrable persons and has served statutory notices on them to confirm their details or when the company has received a statutory notice from a registrable person confirming their details. 

What about non-compliance?

Failure to maintain or establish a Beneficial Ownership Register may result in the company and its directors committing an offence. 
Under the legislation, companies (but not registrable persons) will not be prosecuted for any act or omission which would be an offence under the legislation unless that act or omission takes place after 1 July 2018.
Once a Beneficial Ownership Register has been established, a company (if it becomes aware of any changes) is obliged to serve notice on its registrable persons requesting further information in order to ensure that the particulars provided to the corporate services provider are current. 
The legislation also imposes an obligation on registrable persons to notify the company within 1 month of any changes to their particulars in order to allow the company to update the Beneficial Ownership Register. Failure to do so may be a criminal offence and/or lead to a restrictions notice being served on them by the relevant company.

What happens if we do not respond to Harneys?

The majority of Cayman Islands companies must instruct a corporate services provider (ordinary resident companies may instruct the Registrar of Companies directly) in relation to establishing and maintaining the Beneficial Ownership Register. 
If the company fails to disclose beneficial ownership then Harneys is obliged to issue a statutory notice of non-compliance to the company.

Is the beneficial ownership regime part of the FATCA and Common Reporting Standards (AEOI regime)?

No. The AEOI regime is a separate initiative which has different exemptions and reporting requirements.


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