Incorporation

Companies and Limited Partnerships

The General Registry of the Cayman Islands registers companies, limited partnerships and exempted trusts.

Among the many advantages of registering a company, limited partnership or exempted trust in Cayman are –

• tax neutrality (there are no direct taxes of any kind in the Cayman Islands)
• a well-established legal regime
• reasonable reporting requirements
• flexible corporate structures
• an expedited registration process (under the express service offered, new companies can be registered within 24 hours, provided that all of the required documentation is properly filed).

The Company Registry’s On-line Registry Information Service (CORIS) allows authorised users to have remote access to information on those companies they administer and request services.

The most convenient way to incorporate a company in the Cayman Islands is to engage one of the many professional firms licensed for this purpose. In addition to incorporation services, these firms provide such services as registered offices, directors, nominee shareholders and other officers, and company management services.

Registering a Vessel Ownership Structure

Once a law firm or company management firm (service provider) has been contacted and preliminary matters have been dealt with, the firm or agency will then send an Engagement Letter confirming the nature and purpose of the client’s instruction and the estimated costs involved including any retainer fee required.

Due Diligence: The service provider will need to comply with the anti-money laundering laws and requirements of the Cayman Islands by conducting due diligence on the proposed company’s shareholders and directors which requires proof of identity, proof of address, and a bank reference. Alternatively, an Eligible Introducer Form may be used instead of the above. The “know-your–client” rules of the Cayman Islands are an integral part of the services it offers. Schedule 3 (Third Schedule) to the Cayman Islands Money Laundering Guidance Notes as issued by the Cayman Islands Monetary Authority does recognise due diligence regimes in other countries as equivalences and offers the added feature of the “Eligible Introducer Form” as a method through which new business can be introduced from these approved countries without the duplication of due diligence efforts in the Cayman Islands.

Company Name: The service provider will then conduct a name search of the Company Register to determine the availability of the client’s chosen and alternate company names, as required under section 30 of the Cayman Islands Companies Law (2004 Revision), hereinafter referred to as the Law, before drafting the company’s memorandum of association and articles of association (or Bylaws). Prior to drafting the memorandum of association and articles of association, it will usually be necessary to complete a confidential Company Formation Questionnaire (CFQ). The CFQ contains questions related to the name and address of each director, the purpose of the company and its shareholders, and its share capital, etc. The information gleaned from the CFQ will be used to draft the memorandum of association and articles of association which will be filed with the Registry of Companies.

Registered Office: If the prospective client decides to use the service provider as the registered office for the newly-formed company, then the client will be required to enter into a service agreement or contract (also called a registered office agreement) for the said purpose with the service provider. The service provider will then perform all corporate administrative duties on behalf of the company to be incorporated.

Agents: If a ship-owner decides not to use a Cayman incorporated company to own the Cayman flag vessel, the Merchant Shipping Law requires that an approved local representative person in the Cayman Islands may be appointed. The same service providers mentioned above can usually provide this service. The local representative person acts as the contact point between the CISR and the ship-owner and has certain responsibilities in the event of an accident or emergency involving the ship.

Finally, the service provider will send to the Registry of Companies all documents necessary to register the company as required by section 26 of the Law. The company will be deemed properly registered upon receipt of a certificate of incorporation from the Registry of Companies as provided for under section 27 of the Law.

The Law requires the appointment of directors and notification of the same (and any subsequent changes thereto) to the Registry of Companies within 21 days of appointment.