Cayman Islands: Types of Company
The Companies Law 1961 (as amended, chiefly in 1990, 1995) is based on English law and is the main law governing companies in Cayman. The law was updated, revised and consolidated in 2004, 2007 and 2010. The most recent revision came with the Companies (Amendment) Law, 2011, effective April 27, 2011, which has introduced a number of enhancements to the Companies Law (2010 Revision) such as enabling Cayman Islands companies to hold treasury shares and improving existing provisions, including the merger/consolidation regime.
There are four company types which are commonly registered in Cayman under the Companies Law: Ordinary Resident Company, Ordinary Non-Resident Company, Exempted Company and Exempted Limited Duration Company.
The Companies Law, true to its English origins, permits companies limited by shares, companies limited by guarantee, and unlimited companies; but in practice only companies limited by shares are used. Incorporation and registration of limited companies takes a day, and it can be less. Shelf companies are available but are unusual.
There is a Registrar of Companies, and registration involves submission of the Memorandum of Association; for companies limited by shares the Articles of Association can follow - 'Table A' applies if no Articles are registered.
There needs to be one shareholder of record (of any nationality); there are no rules regarding minimum capital, par value etc. There is no statutory requirement for audit or for annual filing of accounts. All companies must maintain registered offices in Cayman.
However, pressure from the OECD and other international bodies on the Cayman Islands to take steps to counter money-laundering has led to the imposition of more stringent 'KYC' rules on the offshore sector.
The Cayman Islands General Registry reported that active companies registered in the Cayman Islands grew by 10% in 2007 to 87,230 companies, compared with 79,227 companies registered in 2006. The Registry is actively targetting more company registrations from overseas, and the introduction of a new Arabic language facility in 2007 should ensure more business from the Middle East. There were more than 93,000 companies registered as of December 2012.
A number of fees affect both onshore and exempt companies and depends on company status and registered capital. Incorporation fees range from KYD300 to KYD2,468. Annual fees are also levied on a sliding scale and are between KYD300 to KYD815.