Beneficial Ownership Register Requirements

• Law Firm: Conyers
• Subject Matter: Corporate/Commercial Law, Corporate and Company Law
• Author: Conyers
• Published date: 16 January 2023

1. INTRODUCTION

Part XVIIA of the Companies Act, Part 12 of the Limited Liability Companies Act and Part 8 of the Limited Liability Partnership Act (the 'Beneficial Ownership Legislation'), impose obligations on certain Cayman Islands entities to maintain beneficial ownership registers at their registered offices and for the information contained in such registers to be uploaded to the competent authority for beneficial ownership, the General Registry (the 'Competent Authority') via its Corporate Administration Platform ('CAP') system. The information is encrypted upon submission and further encrypted upon receipt. The data is then deleted from CAP and goes to a non-internet facing, offline server only accessible by a Government authorised competent authority. The principal purpose of the Beneficial Ownership Legislation is to make beneficial ownership information normally held by corporate service providers (each a 'CSP') readily accessible in response to proper and lawful requests from specified law enforcement agencies¹ and not to materially expand existing requirements for such information². The registers are not publicly accessible and may only be searched by or on behalf of the Competent Authority.

This publication deals primarily with the Beneficial Ownership Legislation as applicable to companies, as the terminology and specific requirements for limited liability partnerships differ.

2. WHO MUST COMPLY?

The Beneficial Ownership Legislation applies to every company, limited liability company and limited liability partnership incorporated, registered or registered by way of continuation in the Cayman Islands except a legal entity or subsidiary of one or more legal entities, any of which is³:

1. listed on the Cayman Islands Stock Exchange or another approved stock exchange⁴;
2. registered or licensed under a Cayman Islands regulatory act⁵;
3. managed, arranged, administered, operated or promoted by an approved person⁶ as a special purpose vehicle, private equity fund, collective investment scheme or investment fund including where the vehicle, fund or scheme is a Cayman Islands exempted limited partnership;
4. regulated in a jurisdiction that is designated as having measures for combating money laundering and the financing of terrorism which are equivalent to that of the Islands in accordance with section 5(2) of the Proceeds of Crime Act (2020 Revision) (the 'PoCA');
5. a general partner of a vehicle, fund or scheme referred to in paragraph (c) which vehicle, fund or scheme (i) is registered or holds a licence under a regulatory act; or (ii) is managed arranged, administered, operated or promoted by an approved person;
6. holding directly a legal or beneficial interest in the shares of a legal entity which holds a licence under the Banks and Trust Companies Act (2021 Revision), the Companies Management Act (2021 Revision), the Insurance Act, 2010 (as amended), Part III of the Mutual Funds Act (2021 Revision) (as amended) or the Securities Investment Business Act (2020 Revision); or
7. exempted by the applicable regulations.

A company that is exempted from the requirement to keep a beneficial ownership register by virtue of falling into one or more of the categories above is required to provide to its CSP written confirmation of the exemption with prescribed information⁷ together with instructions to file the written confirmation with the Competent Authority. The CSP is then required to provide the Competent Authority with all relevant information from the written confirmation. The company is required to notify the CSP within one month of becoming aware of any changes to the written confirmation.

3. ESTABLISHING A BENEFICIAL OWNERSHIP REGISTER

Unless exempted for one of the reasons listed above, each company to which the Beneficial Ownership legislation applies has an obligation to establish and maintain a register of its beneficial owners (the 'Register') to be kept at its registered office and, in particular, is required to take reasonable steps to identify any individual who is a beneficial owner of the...