The Cayman Islands: Mourant Ozannes presents a guide for hedge fund managers
The Cayman Islands continue to be the preeminent offshore jurisdiction for hedge funds. Around 85% of the world’s hedge funds are domiciled in the Cayman Islands, enabling the jurisdiction to outrank competing offshore centres (BVI, Bermuda and Jersey among them) as the top spot for hedge funds. This paper explains the attractions of the Cayman Islands as a destination for managers wanting to establish hedge funds offshore, and examines the commercial, legal and regulatory considerations that combine to make Cayman their preferred jurisdiction.
Hedge funds established in the Cayman Islands will typically take the form of a company, a limited partnership or (less commonly) a unit trust. If statutory segregation between assets and liabilities of sub-portfolios is desired, the SPC model will be attractive. Each of these vehicles can be used as a stand-alone fund, a fund of funds or as part of a master-feeder structure. Their managers need not be domiciled in the Cayman Islands. Generally, all open-ended funds established in Cayman will need to be registered with CIMA. A fund will be deemed open-ended if it issues “equity interests” (shares, partnership interests or units) that participate in the fund’s profits and gains, and which are redeemable (or otherwise capable of being repurchased) at the investor’s option. The reference to equity interests is important, because this excludes debt instruments (including warrants, convertibles and sukuk instruments); funds issuing such instruments will not be required to be registered with CIMA…
If you are registered and logged in to the site, click on the link below to read the rest of the Mourant Ozannes briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.