Cayman Islands LLC Registration in 2017: Pros and Cons
The introduction of new legal forms in each jurisdiction occurs gradually. So, recently it became possible to register LLC in the Cayman Islands.
Limited Liability Company in the Cayman Islands is a new type of legal form, which in its characteristics reminds LLC in Delaware. This article describes some features of LLC in the Cayman Islands in summaries.
Legislation of Limited Liability Company in the Cayman Islands
The main legislation of the Limited Liability Company in the Cayman Islands is “LLC Law” in 2016.
According to “LLC Law”, any person or several individuals can register LLC in the Cayman Islands for any legitimate purposes or activities, regardless of whether it is profitable or not, provided that LLC has at least one member.
The terms of LLC are invariably set out in the “LLC Agreement Agreement”, which allows the participants to coordinate the internal work of the company. Participants can agree such mechanisms as capital accounts and capital commitments, the profits distribution and losses, voting methods and classes of interests.
After LLC incorporation in Cayman, the company becomes a corporate entity and has a legal status separate from its members. The company will be able to perform all functions of a physical person in full regardless of any issues of corporate benefits and will have permanent succession, ability to sue, defend litigation in own name and have the right to purchase, retain and dispose of the property.
The Cayman LLC can be registered for any legitimate purposes that must be carried out and undertaken either within the jurisdiction or outside the territory in accordance with the LLC law, upon the condition that the company does not engage in business with the population in the Cayman Islands.
Certain actions are regulated within the jurisdiction and the company can obtain a license if it wishes to continue the working. There are banking business, trust business, insurance business, mutual funds administration, mutual fund business and securities business investment.
Registration Rules for the Limited Liability Company in the Cayman Islands
The company must be registered with the registrar in order to incorporate LLC within the law. Registration is carried out by paying a fee and submitting an application:
1. Company LLC name
2. Address of the legal office in the Cayman Islands
3. Duration of the LLC
4. Application that LLC will not engage in business with the population of the Cayman Islands
After the application, LLC is considered as registered and the registrar issues a registration certificate, which serves as conclusive evidence that the conditions were met with all requirements according to the “LLC law”.
LLC registration in the Cayman Islands - choice of the name
The LLC company may contain the words "Limited Liability Company" or the abbreviation "L.L.C." or "LLC", but this is not strictly necessary. If LLC conducts business in a special economic zone, it should include the words "special economic zone" or "SEZ". LLC can have 2 foreign names that do not use the Latin alphabet, that is using letters, symbols, accents and other diacritical marks.
LLC must have a registered office located in the Cayman Islands to serve the process and where all messages can be delivered.
For managers or members of LLC there are no requirements to the residence. It is not necessary to hold meetings of its managers / members in the Cayman Islands or elsewhere, unless it is required by the LLC agreement.
Change of registration data
If it were some changes, LLC within 30 days from the date of the amendment makes a reference to the registration application and pays the established registration fee.
At the time of LLC registration in the Cayman Islands, the person will be admitted as an initial participant. After registration, membership fees can be admitted as a part of a merger plan. When a foreign company continues to operate in the Cayman Islands under the LLC law or when a company is converted from an exempt company, a member will be considered as a member of the LLC from the date of the continuation or conversion.
The LLC Agreement may provide that the company's management is wholly / partially endowed with one or more managers and may also create classes of managers with such rights, powers and responsibilities as specified in the manual.
The manager can also be a member. A member or manager may conduct business with LLC and has the same rights and obligations with respect to him as a person who is not a member or manager.
LLC must maintain a register of members containing the name and address of each person who is a member of the company. And also the date of the beginning of the membership and the date when they ceased to be a member.
The register of the participants should not be stored in the registered office of the company, but if it is stored elsewhere, the registered office must keep track of the address on which it is stored. The register of participants is not open for public inspection.
Appropriate accounting books should be kept for at least five years.
How to register an LLC company in the Caymans?
To open an offshore company LLC in the Caymans, first of all you need to contact us for a help.
We will give you advices, related to the package of documents and company registration. Consultation with us is free of charge.
We will be happy to answer on your questions!