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Grand Cayman KY1-1001
Cayman Islands
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Mutual Funds - Registration/Licensing

Where can the Mutual Funds Law be obtained?

The latest Mutual Funds Law (MFL) is available here on our website for informational purposes only. A hard copy can be purchased from the Cayman Islands Legislative Assembly.

  • As defined by the Mutual Funds Law (MFL), a mutual fund is "any company, trust or partnership either incorporated or established in the Cayman Islands, or if outside the Cayman Islands, managed from the Cayman Islands, which issues equity interests redeemable at the option of the investor, the purpose of which is the pooling of investors' funds with the aim of spreading investment risk and enabling investors to receive profits or gains from investments."
  • There are five types of mutual funds that are regulated under the MFL: Registered Fund under Section 4(3); Master Fund under Section 4(3)(a)(iii); Limited Investor Fund under Section 4(4); Administered Fund under Section 4(1)(b); and Licensed Fund under Section 4(1)(a).

No. A “Master Fund”, as defined in the Mutual Funds Law (MFL), has been specifically carved out from the provisions of section 4(4)(a) of the MFL.

Yes.  A master fund that is a “mutual fund” for the purposes of the MFL but does not meet the definition of a “Master Fund” under the MFL and is therefore precluded on that basis from registering as a “Master Fund” under section 4(3)(a)(iii) of the MFL is able to register as a “mutual fund” under section 4(4)(a) of the MFL, where it meets the prescribed criteria.

For a funds’ in this situation, CIMA requires the following on application:

  • Application Form(APP-101-79);
  • Offering Document/Summary of Terms/Marketing Material;
  • Certificate of Incorporation/Registration;
  • Confirmation that majority of investors have the power to appoint/remove the operator(s) (Constitutional documents/ resolution/ Offering document etc.);
  • Auditor’s letter of consent;
  • Administrator’s letter of consent (if applicable);

 

Yes.  In these circumstances, the fund would need to comply with the requirement to file an offering document or summary of terms under section 4(3)(b)(i) or section 4(4)(a)(ii) of the MFL.

Yes.  A Limited Investor Fund that completes its liquidation/winding-up prior to the end of the transition period will not be required to apply for registration pursuant to the MFL.  The completion of the liquidation/winding-up process means that the fund has disposed of all its investments and has made final investor distributions.   

  • REEFS Application Form (APP-101-77);
  • Certificate of Incorporation/Registration (as
  • applicable);
  • Constitutive Documents (Memorandum & Articles of Association/Trust Deed/Declaration of Partnership (as applicable);
  • Offering Memorandum/Summary of Terms/Marketing Material (as applicable);
  • Auditor’s letter of consent;
  • Administrator’s letter of consent (if applicable);
  • Structure Chart; and
  • Application Fee CI$300 (US$365.85)

  • Application form (APP-101-78);   
  • Application form (APP-101-79);   
  • Application Fee CI$300 (US$365.85);
  • Certificate of Incorporation/ Registration;
  • Offering Memorandum/Summary of Terms/Marketing Material (as applicable);
  • Confirmation that majority of investors have the power to appoint/remove the operator(s) (Constitutional documents/Resolution/Offering memorandum etc.);
  • Auditor’s letter of consent (if available); and
  • Administrator’s letter of consent (optional).

  • REEFS Application Form (Form: APP-101-22);
  • Affidavit for electronic records;
  • Auditor’s letter of consent;
  • Administrator’s letter of consent;
  • Certificate of Incorporation/ Registration;
  • Offering Document;
  • Applicable Fee CI$3,500 (US$4,268.29) + CI$300(365.85) Admin Fee + CI$250(US$304.88) per Segregated Portfolio up to max of 25 (if applicable);
  • REEFS MLRO Application form (Form: MLO-154-99) .
  • Documents required for appointed directors:
    • Completed Personal Questionnaires (“PQ”);
    • Three references (including one financial reference and two-character reference);
    • Police clearance certificates;
    • Notarized or similarly certified colour copy of government issued photo identification;
    • Resume/CV and;
    • Certified copies of academic/professional qualifications as listed in the PQ.
  • Background details on the service providers, if not included in the offering document.

  • REEFS Application Form (Form: (APP-101-22)
  • Affidavit for electronic records;
  • Auditor’s letter of consent;
  • Administrator’s letter of consent 
  • Certificate of Incorporation/ Registration; 
  • Offering Document;
  • Applicable Fee CI$3,500 (US$4,268.29) + CI$300(365.85) Admin Fee + CI$250(US$304.88) per Segregated Portfolio up to max of 25 (if applicable); and
  • REEFS MLRO Application form (Form: MLO-154-99).

  • REEFS Application Form (APP-101-22), (APP-101-53);
  • Affidavit for electronic records; 
  • Auditor’s letter of consent; 
  • Administrator’s letter of consent; 
  • Certificate of Incorporation/ Registration; 
  • Offering Document;
  • Applicable Fee of CI$3,500(US$4,268.29) + CI$300(365.85) Admin Fee + CI$250(US$304.88) per Segregated Portfolio up to max of 25 (if applicable);
  • Master Fund - Applicable Fee of Certificate of Fee CI$2,500(US$3,048.78) + CI$300(365.85) Admin Fee + CI$250(US$304.88) per Segregated Portfolio up to max of 25 (if applicable); and
  • REEFS MLRO Application form (MLO-154-99). 

Applications are submitted electronically though the Authority’s secured Regulatory Enhanced Electronic Forms Submission (REEFS) web portal, which is only accessible by authorized service providers. For more information, see REEFS FAQs.

All documentation and payment must be submitted to the Authority before the processing of the application will commence. The documentation required for the registration/licensing of a mutual fund is outlined on the applicable REEFS form. For more on information, see REEFS FAQs.

A fund’s registration/licence application will be rejected where the documentation submitted is incorrect or incomplete. Listed below are some of the common reasons why the Authority will reject an application: 

  • All operators are not identified on the REEFS application form;
  • Director(s) specified is not registered/licensed or is non-compliant pursuant to the Director Registration and Licensing Law, 2014 Revision (the “DRLL”);
  • The Investment Manager (“IM”) named to the fund is not authorized pursuant to the Securities Investment Business Law (as revised) (the “SIBL”);
  • Registration/licence application fee omitted;
  • Incorrect / Incomplete attachments; and
  • Inconsistency in documentation – e.g. Name of the fund submitted through REEFS differs from the Certificate of Incorporation/Certificate of Registration.

The registration/licence date of a fund will be date that a complete application has been received by the Authority - i.e. the re-submission date when the fund has submitted all documents, fees and information as required pursuant to the MFL.

Prior to submitting an application, service providers should confirm with the proposed director that he/she is compliant with the DRLL. It is the director’s responsibility to advise the fund, at the time of being proposed as a director, of his/her status pursuant to the DRLL and if not in compliance, to regularize such status prior the submission of the fund’s application.

Prior to submitting an application, service providers should confirm that the proposed IM is duly authorized pursuant to the SIBL. It is the IM’s responsibility to advise the fund, at the time of being proposed as an IM, of their status pursuant to the SIBL and if not in compliance, to regularize such status prior the submission of the fund’s application.

Registered Funds
(MFL- Sec. 4(3))
Master Funds
(MFL- Sec. 4(3))
Administered
Funds
(MFL- Sec. 4
(1)(b))
Licensed Funds (MFL - Sec. 4 (1)(a))

Applicable Fee
CI$3,500
(US$4,268.29) +
 CI$300(US$365.85)
Admin Fee +
CI$250(US$304.88)
per Segregated
Portfolio up to max of
25 (if applicable)

Applicable Fee
CI$2,500
(US$3,048.78) +
CI$300(US$365.85)
Admin Fee +
CI$250(US$304.88)
per Segregated
Portfolio up to max of
25 (if applicable)

Applicable Fee CI$3,500 (US$4,268.29) + CI$300(US$365.85) Admin Fee + CI$250(US$304.88) per Segregated Portfolio up to max of 25 (if applicable) Applicable Fee CI$3,500 (US$4,268.29) + CI$300(US$365.85) Admin Fee + CI$250(US$304.88) per Segregated Portfolio up to max of 25 (if applicable)

or

Registered Funds (MFL- Sec. 4(3)); Administered Funds (MFL- Sec. 4 (1)(b)) and Licensed Funds (MFL - Sec. 4 (1)(a))

  • Applicable Fee - CI$3,500 (US$4,268.29)
  • Admin Fee - CI$300(US$365.85)
  • Segregated Portfolio (if applicable) - CI$250(US$304.88) per Segregated Portfolio up to max of 25

Master Funds (MFL- Sec. 4(3))

  • Applicable fee - CI$2,500 (US$3,048.78)
  • Admin Fee - CI$300(US$365.85)
  • Segregated Portfolio (if applicable) - CI$250 (US$304.88) per Segregated Portfolio up to max of 25 

Closed-ended funds are not required to be registered with the Authority as they do not meet the definition of a mutual fund pursuant to the Mutual Funds Law (Revised) (the “MFL”). However, if the fund wishes to register on a voluntary basis with the Authority, all the standard registration requirements will have to be fulfilled. Once the fund is registered with the Authority, it will have to comply with all the requirements of the MFL e.g. file audited financial statements as required, pay required fees in a timely manner, etc. as any other registered/licensed fund. The fund being closed-ended therefore does not relieve it from any of its ongoing requirements under the MFL.

A MF form (MF1/2/2A/3/4) is not required for an initial mutual fund registration/licence however, an updated MF Form should be submitted electronically through licensing@cima.ky whenever two or more material changes are made after the mutual fund has been registered/licensed. The administrative fee required when submitting the updated MF Form is CI$300.00 / US$365.85.

In determining whether a person is "fit and proper" the Authority will consider a person's: - (a) honesty, integrity and reputation; (b) competence and capability, and (c) financial soundness. The Authority has issued guidance on this matter. To access these, click on the link: Rules, Statement of Guidance page.

The Authority requires the following:

  • Cover letter outlining the request for re-registration;
  • Return of the original Certificate/Licence (if applicable) or Affidavit of Lost Certificate;
  • Completed MF Form that has been duly signed and dated (Please note a REEFS form for re-registration is under construction) ;
  • Updated Offering Document (or supplement); and
  • Payment of the administrative fee for the MF form ($300.00) and the amendment to offering document/supplement fee ($100.00).
  • Certificate of Name Change (if applicable)

In addition to the above, funds re-registering pursuant to Section 4(3) of the Mutual Funds Law will also require an affidavit from the operators of the fund attesting that all current investors meet the US$100,000 minimum investment criterion as required pursuant to Section 4(3) of the Mutual Funds Law.

  • Section 4.3 of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund state, “The Authority may consider extending the fund’s first audit period for a maximum of 18 months from the date of registration. Consideration may also be given to extending the fund’s last audit period for a maximum of 18 months from the date of the last financial year end for which an audit has been filed.”
  • There is no application fee for a request to extend a regulated mutual fund’s first or final audit period.
  • The Authority requires a duly signed and dated cover letter (on official letterhead paper) from a current core service provider on record (Administrator, Investment Manager/Advisor, Legal Counsel, Manager, Operator(s), Registered/Principal Office) and the request must be sent via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line.
  • A regulated mutual fund that provided an Auditor’s Letter of Consent during its registration process which explicitly stated that the regulated mutual fund’s first audit period will exceed 12 months (up to a maximum period of 18 months) is not required to provide an Administrator’s Letter to confirm the commencement of its trading activity.
  • A final audit period extension application in relation to a deregistering regulated mutual fund will not be considered until the relevant completed deregistration application has been received by the Authority (via the REEFS Portal).
Mutual Funds - Terminations

The Authority has issued both the Rule and Regulatory Procedure on Cancellation of Licenses issued pursuant to Section 5 and Certificates of Registration issued pursuant to Sections 4(3) and 4(1) (b) of the Mutual Funds Law on the procedures and documentation required for the cancellation of mutual fund licenses and certificates of registration.

The termination fee for a mutual fund registration/licence is CI$600.00/ US$731.71.

Once a Fund submits the core documentation required to terminate (Original certificate of Registration/Licence, Cancellation fee and the Directors resolutions to terminate) it is placed in LUT status until the remaining termination items are received. Upon receipt of the requisite items the Fund is then terminated.

If the new financial year begins prior to the receipt of the outstanding termination items but after the receipt of the core documents to terminate, a regulated mutual fund in LUT status is liable for half of the annual license fee. Should the fee not be submitted, the mutual fund will accrue a penalty of 1/12th of the amount owed on the 15th day of each month. In addition, if a regulated mutual fund submits a Fund Annual Return (“FAR”) Filing (via the REEFS Portal) after it obtains LUT status, it will be fully liable for paying the relevant FAR Filing Fee(s) to the Authority before its registration/licence is terminated.

LUL status is given to a fund upon receipt of the core documentation required to terminate (Original certificate of Registration/Licence, Cancellation fee and the Directors resolutions to terminate) along with the Notice of the winding up of the Fund (CWR Form No. 19) and Voluntary liquidator's consent to act (CWR Form No. 20).

A regulated mutual fund in LUL status will not accrue future Annual License Fees or Penalties; however, the regulated mutual fund will be fully liable to pay all of its regulatory fees (e.g. Annual License Fees, Penalties, Fund Annual Return (“FAR”) Filing Fees, etc.) which it incurred prior to it obtaining LUL status. In addition, if a regulated mutual fund submits a FAR (via the REEFS Portal) after it obtains LUL status, it will be fully liable for paying the relevant FAR Filing Fee(s) to the Authority before its registration is terminated.

Section 7.1 of the Regulatory Procedure for the Cancellation of Regulated Mutual Funds states, “Unless a Fund qualifies for an audit waiver, it must provide audited accounts from the date of the last financial year end (for which audited statements have been filed) either to the date of commencement of the winding up where third party liquidator(s) have been appointed, or the date of the final distribution if no third party liquidator(s) have been appointed.” In accordance with the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund, a third-party liquidator, “means individuals, serving as liquidators in a voluntary liquidation of a fund, who are not the operators or currently engaged service providers (excluding an auditor of the fund).”

The Authority must receive a formal request for the reactivation of the mutual fund registration/licence.

An affidavit from the operator of the fund that at a minimum include statements confirming the following;

  • The reason for the fund wishing to discontinue its previous request to be de-registered/terminated;
  • That as far as the operator is aware the mutual fund has operated in accordance with its articles or other constitutive documents and its offering document including adherence to all investment guidelines and restrictions and computation of the net asset value; and
  • That all investors in the fund, at the time when the previous termination application was submitted, have been properly and completely redeemed out of the fund and paid in full, or informed about the continued operation and regulatory status of the fund.
  • Provide a certified copy of the resolution of the operators of the fund which should repeal the previous decision to cease business as a mutual fund in or from within the Islands; and
  • An Updated Offering Document and OM plus applicable Filing fees of CI$100.00/US$121.95
  • Fee for a new certified hard copy of certificate CI$300/US$365.85.
Mutual Funds - Ongoing Updates/Fillings

In the case of an Administered Fund, where the licensed mutual fund administrator providing the fund’s principal office has changed, the following must be submitted to the Authority: 

  • Cover letter stating the request for the change of administrator/principal office.
  • Original Certificate/Licence (for cancellation) or in the case of a lost/destroyed Certificate/Licence, an affidavit stating that the Certificate/Licence will be returned to the Authority if found (if applicable).
  • Updated MF2A form (and MF2 form if applicable).
  • Letter of Consent from the newly appointed administrator/principal office.Fee of CI$500/US$609.76 for the change in appointed service provider in the case of a licensee or licensed fund, OR CI$300/US$368.85 administration filing fee for a revised MF2 & MF2A form in the case of an Administered Fund.

  • If the fund is changing its FYE and retaining the same auditor, the Authority requires a formal letter detailing the reason(s) for the FYE change.
  • If a new auditor is being used, we will require a new Auditor’s LOC before the change can be processed. The newly appointed auditor must supply CIMA with a LOC stating that they are willing to accept the appointment as Auditor for the entity. Conditional letters of acceptance are not acceptable. The letter must be on official letterhead and must include: the name of the Fund, date of the Fund’s financial year-end, what accounting principles will be used and a statement that they are aware of and agree to fulfil their obligations pursuant to Section 35 the MFL. For both scenarios above, the Authority also require a copy of the resolution changing the FYE and that the change in FYE is reflected in the next filing of the OM.

  • The Authority requires a duly signed and dated cover letter (on official letterhead paper) which explicitly states the single basis for the audit waiver request as is outlined in Section 4.4. of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund from a current core service provider on record (Administrator, Investment Manager/Advisor, Legal Counsel, Manager, Operator(s), Registered/Principal Office).
  • The Authority also requires the scenario specific documentation which is outlined in Section 5 of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund to compliment the cover letter. The audit waiver application fee is CI$500.00 / US$609.76.
  • Regulated umbrella fund structures (with underlying sub-funds) such as segregated portfolio companies and unit trusts are required to submit an audit waiver request for each sub-fund (along with the necessary application fee for each sub-fund request) that files individual audited accounts with the Authority. However, if the relevant umbrella fund files consolidated audited financial statements, and it wishes to apply for an audit waiver, then only one (1) audit waiver request will be required (per applicable year) as the umbrella fund will submit a single audit (per applicable year) to the Authority.
  • Regulated mutual funds which are seeking to deregister with the Authority must submit their audit waiver applications (either via the REEFS Portal within the regulated mutual fund’s deregistration application, or, via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line) at the same time as or after their deregistration applications have been submitted to the Authority.
  • An audit waiver application in relation to a deregistering regulated mutual fund will not be considered until the relevant completed deregistration application has been received by the Authority.

A “sub-fund” includes a segregated portfolio within a segregated portfolio company structure; a sub-trust within an umbrella or master unit trust structure; and a class of shares, or units or interests within a fund, trust or partnership structure, where each such class represents a separate standalone reporting entity (e.g. a fund with multiple portfolios, where each portfolio is individually presented with separate assets, liabilities, income and expenses).

A Feeder Fund is a mutual fund that conducts more than 51% of its investing in a master fund either directly or through an intermediary entity.

Please be advised that the Authority presently accepts payments by means of one of the following payment methods:

The two methods used by overseas entities are payments by bank draft or wire transfer. Bank draft payments should be made payable to the “Cayman Islands Government” and should be sent via express courier. Please find attached the wire instruction to be used for wire transfers. Ensure that any fees levied by the institution that will be used to wire Funds are accounted for, as well as a US$7.50 bank charge levied by our receiving bank. This will ensure that we receive the exact amount that is due, and therefore prevent any further delays.

In addition, please note that a confirmation of the payment should accompany the correspondence and/or request, which can be sent to feescorrespondence2@cimoney.com.ky and/or mailed to the Authority using the contact details below. Additionally, please state the registration name and/or number of the entity/entities and the amount to be applied to each entity to assist with processing of the payment(s).

All fees are quoted in Cayman Islands Dollars (CI$). The conversion rate to be used for payment in United States (US$) is 0.82 (US$1.00 = CI$0.82).

A mutual fund shall pay the prescribed annual fee on or before the 15th of January in each year.

In order for a fund to change its name, the following documents are required:

  • the original Certificate of Registration/License for cancellation (if applicable);
  • a certified copy of the Certificate of Incorporation on Change of Name obtained from the Registrar of Companies;
  • the prescribed fee of CI$500/US$609.76 as per our Fee Schedule.

An updated MF Form should be submitted electronically through licensing@cima.ky whenever two or more material changes are made. The administrative fee required when submitting the updated MF Form is CI$300.00/US$365.85.

Pursuant to Section 4(8) of the MFL, any change that materially affects the information in the offering document must be filed electronically through licensing@cima.ky within twenty-one (21) days of the change. These include changes to:

Material changes to a Fund include (but not limited to):

  • the investment objectives and strategies
  • investment managers/advisors
  • investment risks
  • operators
  • service providers
  • registered office
  • change of name
  • principal office
  • Change in administrator
  • creation of a Segregated Portfolio

*A new/amended MF Form should be submitted electronically through licensing@cimoney.com.ky whenever two or more material changes are made. The original MF form must be provided to the Authority. The payment of a CI$300/US$356.85 fee for the filing of an amended MF form, and payment of CI$100/US$121.95 for the filing of an amended OM, or addendum to an OM are also required.

LOGS are requested by regulated entities to verify that they are up to date with their regulatory filings and fees, these letters will usually be processed within 3 working days. The following are required:

  • A request/ REEFS submission from a core service provider (e.g. Registered Office, Administrator, or Legal Counsel);
  • Required fee of CI$800/US$975.61;

A request for a letter of good standing from a third party must be accompanied by a letter from a current service provider to the fund (which is usually the Registered Office) authorizing the party in question to obtain the LOGS.

Pursuant to Section 9 of the Retail Mutual Funds Japan Regulation (As revised) (the “Jap Reg”) a retail mutual fund must submit to the Authority a written report on the activities of the retail mutual fund within twenty days after the end of the six month period following the end of each financial year. The report should contain the following:

  • the name of the retail mutual fund together with all previous names;
  • the net asset value of each security held by investors;
  • the percentage change in the net asset value and each security from the previous reporting period;
  • the value of the net assets;
  • the number and value of new subscriptions in the relevant reporting period;
  • the number and value of redemptions or repurchases in the relevant reporting period; and
  • the total number of securities in issue at the end of the reporting period.

  • Ensure that the new auditor is an approved auditor of the Authority;
  • One Auditor should be auditing all underlying sub-entities (e.g. segregated portfolios, sub-funds, series trusts) should this mutual fund be an umbrella fund (e.g. segregated portfolio company, multi-fund structure); and
  • The newly appointed auditor must supply the Authority with a formal letter stating that they are willing to accept the appointment as Auditor for the entity. Conditional letters of acceptance are not acceptable. The letter must be on official letterhead and must include: the name of the Fund, date of the Fund’s financial year-end, accounting principles to be used and a statement that they are aware of and agree to fulfil their obligations pursuant to Section 35 the MFL. If the financial yearend (“FYE”) is changing, the Authority will also require a copy of the resolution changing the FYE and would also request that the change in FYE be reflected in the next filing of the OM.

  • If the appointed administrator is local, verify that the new Administrator is licensed by the Authority .
  • A letter of consent (“LOC”) from the new administrator must be on official letterhead, state that they are willing to accept the appointment as administrator for the Fund and provide a summary of the services that they will be carrying out. If the administration services are split between 2 contracted entities, a LOC is required from both the Calculation Agent and the Registrar/Transfer Agent.

Copy of Board of Directors (“BOD”) resolution confirming the change in Registered Office

An updated OM or Supplement is required to be submitted to the Authority when there has been any change that materially affects the information in the OM. The updated OM or Supplement is required to be file electronically through licensing@cima.ky within twenty-one (21) days of the change. These include changes to:

  • The investment objectives and strategies
  • Investment managers/advisors
  • Investment risks
  • Operators
  • Service providers
  • Registered office
  • Change of name

One of the following documents are required:

  • A resignation letter from the retiring Director;
  • Resolution confirming the change in Director; or
  • An updated Register of Director (“ROD”).

Documentation required for adding a director:

  • A police clearance certificate / affidavit of no convictions;
  • One financial reference and two personal references ;
  • A Personal Questionnaire, completed; and
  • Application fee of CI$1,000/US$1,219.51.

An electronic copy of the revised/new offering document or supplement is required as well as the directors resolution evidencing the date of creation to add a sub-fund. This must be submitted to the Authority through the REEFS portal. Also, to process this request, the prescribed fee, as per our Fee Schedule, must be submitted to the Authority and attached to the REEFS application form. For more information on REEFS, see REEFS FAQs.

The following is required:

  • A formal request of a Certificate of Registration/Licence, which would usually come from the Registered Office, must outline the reason for requesting a certified copy. If the original Certificate of Registration/Licence is lost, then the request should be accompanied by an Affidavit of Lost Certificate/Licence;
  • A fee in the amount of CI$300.00/US$368.85.

The specific reasons are outlined in Section 4.4. of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund.

The Authority will only consider one (1) single basis for each audit waiver request (combined bases will not be considered).

Section 4.5 of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund states, “If a fund applies for an exemption for two consecutive years, the Authority may ask for additional information from the fund’s operators or administrator about the reasons for the fund’s inability to produce audited accounts.”

  • Section 4.3 of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund states, “The Authority may consider extending the fund’s first audit period for a maximum of 18 months from the date of registration. Consideration may also be given to extending the fund’s last audit period for a maximum of 18 months from the date of the last financial year end for which an audit has been filed.”
  • There is no application fee for a request to extend a regulated mutual fund’s first or final audit period.
  • The Authority requires a duly signed and dated cover letter (on official letterhead paper) from a current core service provider on record (Administrator, Investment Manager/Advisor, Legal Counsel, Manager, Operator(s), Registered/Principal Office) and the request must be sent via e-mail to EReporting@cimoney.com.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line.
  • A regulated mutual fund that provided an Auditor’s Letter of Consent during its registration process which explicitly stated that the regulated mutual fund’s first audit period will exceed 12 months (up to a maximum period of 18 months) is not required to provide an Administrator’s Letter to confirm the commencement of its trading activity.
  • A final audit period extension application in relation to a deregistering regulated mutual fund will not be considered until the relevant completed deregistration application has been received by the Authority (via the REEFS Portal).

  • Such extensions are considered on a monthly basis, up to a maximum of three (3) months post the original audit filing deadline. A current core service provider on record (Administrator, Investment Manager/Advisor, Legal Counsel, Manager, Operator(s), Registered/Principal Office) for the regulated mutual fund must submit a written request (in the format of a duly signed and dated cover letter on official letterhead paper).
  • The request must be sent via e-mail to EReporting@cimoney.com.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line. In addition, the request must clearly state the reason(s) for the request and it must also state the regulated mutual fund’s financial year that is affected.
  • All requests for audit filing extensions beyond the first month (in relation to 2nd and 3rd audit extensions only) must be accompanied by a letter from the regulated mutual fund’s auditor which comprehensively explains the reason(s) for the audit filing delay.
  • The audit extension application fee(s) (each audit extension month incurs its own application fee – bundling multiple months under a single gross fee will not be accepted) is CI$500.00 / US$609.76 (there is an additional US$7.50 bank charge for each wire transfer) and it must be received by the Authority (in the mandatory format via e-mail at EReporting@cimoney.com.ky) on the date of or prior to the regulated mutual fund’s current audit filing deadline.
  • Regulated umbrella fund structures (with underlying sub-funds) such as segregated portfolio companies and unit trusts are required to submit an audit filing extension request fee (on a month-by-month basis) for each sub-fund which files individual audited financial statements with the Authority. However, if the relevant umbrella fund files consolidated audited financial statements, and it wishes to apply for an audit filing extension, then only one (1) audit filing extension request fee will be required (per applicable month) as the umbrella fund will submit a single audit to the Authority.
  • Audit extension requests should be submitted to the Authority prior to the regulated mutual funds’ audit filing deadlines to ensure that they remain in good standing. Late audit extension requests maybe subject to additional review and longer processing periods by the Authority and the regulated mutual funds will be and remain in breach of sections 8(1) and 8(2) of the Mutual Funds Law (as revised) until the Authority receives the necessary audit filings (via the REEFS Portal).
Auditors - Mutual Funds

Under the Mutual Funds Law (as revised), a regulated mutual fund must have its accounts audited annually by an approved auditor. The Authority has implemented a policy requiring local auditor sign-off of annual audit reports of regulated mutual funds and licensed mutual fund administrators incorporated or established locally. Click the link to view: Local Audit Sign-off Policy.

For information on how to become an approved auditor, please click on the following link: Regulatory Policy - Approval of an Auditor for a Regulated Institution. Additionally, as per our Fee Schedule, the prescribed fee of CI$15,000/US$18,292.68 must be submitted to the Authority with the application documentation.

It is an approved auditor's letter to the Authority wherein the auditor explicitly accepts its appointment as auditor, confirms the name of the fund, the year-end date of the first audited financial statements and what accounting principles will be used. It also contains a statement confirming that the auditor is aware of and it agrees to fulfil its obligations pursuant to section 35 of the Mutual Funds Law (as revised).

The REEFS Portal currently creates audit filing rows (for the 2014 and 2015 audit periods) for newly registered regulated mutual funds. If the visible audit filing rows within the REEFS Portal do not apply to a newly registered regulated mutual fund, please disregard them until the Authority removes them.

The Authority requires an e-mail from the regulated mutual fund’s approved auditor (the request must be sent via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line) which clearly explains the issue. The Authority will review the concern and it will revert to the regulated mutual fund’s approved auditor with information as soon as possible. A few common scenarios are:

  • A regulated mutual fund has officially changed its auditor and it has not duly notified the Authority of the change.
  • A regulated mutual fund has not submitted all of its required audited accounts since its registration date with the Authority (this also applies to sub-funds).
  • A regulated mutual fund has created and launched a sub-fund and it has not duly notified the Authority about the existence of the new sub-fund.

Section 7.1 of the Regulatory Procedure for the Cancellation of Regulated Mutual Funds states, “Unless a Fund qualifies for an audit waiver, it must provide audited accounts from the date of the last financial year end (for which audited statements have been filed) either to the date of commencement of the winding up where third party liquidator(s) have been appointed, or the date of the final distribution if no third party liquidator(s) have been appointed.” In accordance with the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund, a third party liquidator, “means individuals, serving as liquidators in a voluntary liquidation of a fund, who are not the operators or currently engaged service providers (excluding an auditor of the fund).”

No. The Authority will not amend any audit row periods within the REEFS Portal to enable approved auditor to receive specific audit period confirmation e-mails. A regulated mutual fund’s audit filings must be submitted in the relevant financial year’s audit filing row within the REEFS Portal. The REEFS Portal automatically generates a regulated mutual fund’s audit filing row at the end of each financial year, and as a result, the approved auditing firm should submit the regulated mutual fund’s audit filings in the relevant financial year’s audit filing row (even if the audit filings cover a period of less than 12 months, or, more than 12 months up to a maximum of 18 months)

The Authority requires an e-mail from the Operator(s), or, the regulated mutual fund’s approved auditor (the request should be sent via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line) which clearly states the reason(s) why the specific set of audited financial statements (and the associated fund annual return) need to be rejected by the Authority. The Authority will consider the request and will communicate its decision back to the submitter via e-mail. If the Authority does perform the audit filings’ rejection, it requires that only the reason(s) for the audit filings’ rejection be addressed before the resubmission. There is no application fee to request the rejection of previously submitted (via the REEFS Portal) audit filing on behalf of a regulated mutual fund. Furthermore, a regulated mutual fund will not accrue an additional Fund Annual Return Filing Fee when it resubmits (via the REEFS Portal) a previously submitted audit filing.

  • The Authority requires a duly signed and dated cover letter (on official letterhead paper) which explicitly states the single basis for the audit waiver request as is outlined in Section 4.4. of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund from a current core service provider on record (Administrator, Investment Manager/Advisor, Legal Counsel, Manager, Operator(s), Registered/Principal Office).
  • The Authority also requires the scenario specific documentation which is outlined in Section 5 of the Regulatory Policy Exemption from Audit Requirement for a Regulated Mutual Fund to compliment the cover letter. The audit waiver application fee is CI$500.00 / US$609.76
  • Regulated umbrella fund structures (with underlying sub-funds) such as segregated portfolio companies and unit trusts are required to submit an audit waiver request for each sub-fund (along with the necessary application fee for each sub-fund request) that files individual audited accounts with the Authority. However, if the relevant umbrella fund files consolidated audited financial statements, and it wishes to apply for an audit waiver, then only one (1) audit waiver request will be required (per applicable year) as the umbrella fund will submit a single audit (per applicable year) to the Authority.
  • Regulated mutual funds which are seeking to deregister with the Authority must submit their audit waiver applications (either via the REEFS Portal within the regulated mutual fund’s deregistration application, or, via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line) at the same time as or after their deregistration applications have been submitted to the Authority.
  • An audit waiver application in relation to a deregistering regulated mutual fund will not be considered until the relevant completed deregistration application has been received by the Authority.

  • Ensure that the new auditor is an approved auditor of the Authority;
  • One Auditor should be auditing all underlying sub-entities (e.g. segregated portfolios, sub-funds, series trusts) should this mutual fund be an umbrella fund (e.g. segregated portfolio company, multi-fund structure); and
  • The newly appointed auditor must supply the Authority with a formal letter stating that they are willing to accept the appointment as Auditor for the entity. Conditional letters of acceptance are not acceptable. The letter must be on official letterhead and must include: the name of the Fund, date of the Fund’s financial year-end, accounting principles to be used and a statement that they are aware of and agree to fulfil their obligations pursuant to Section 35 the MFL. If the financial yearend (“FYE”) is changing, the Authority will also require a copy of the resolution changing the FYE and would also request that the change in FYE be reflected in the next filing of the OM.

The following should be submitted to the Authority:

  • Confirmation that the Auditor is no longer registered with CIIPA.
  • Confirmation that the Auditor will no longer provide audit services to mutual funds/mutual fund administrators.
  • Proof of the dissolution of the partnership It should be noted that based on the receipt of the above mentioned, the Authority may have further questions, seek further clarification and request additional documentation.

It should be noted that based on the receipt of the above mentioned, the Authority may have further questions, seek further clarification and request additional documentation.

Private Funds Law 2020

A Private Fund, irrespective of being an AIV in a structure falling under a non-Cayman main fund, is subject to section 13(1) of the PFL, which requires the Private Fund to have its accounts audited annually by an auditor approved by CIMA. The Private Fund is also required to submit its audited accounts, along with the Fund Annual Return (“FAR”), to CIMA within six months of the end of each financial year.

The Private fund is able to satisfy its obligation pursuant to section 13(1) of the PFL in one of the following ways:

  1. Submit its own stand-alone financial statements annually, which have been signed-off by an auditor approved by CIMA, along with the FAR; or
  2. Submit the consolidated financial statements of the non-Cayman main fund annually, which have been signed-off by an auditor approved by CIMA, along with the FAR

For a Private Fund that is an AIV in a structure that includes other Cayman AIVs, which have been individually registered as private funds, the following options are also available to satisfy the Private Fund’s obligation pursuant to section 13(1) of the PFL:

 

  1. For two or more private funds, which are AIVs falling under a non-Cayman main fund, audit such private funds as a group stripped out from the non-Cayman main fund, wherein such audited financial statements are signed-off by an auditor approved by CIMA and each private fund that forms part of this group audit submit such financial statements, along with the FAR, in order to meet their individual obligation pursuant to section 13(1) ; or
  2. Submit the consolidated financial statements of the non-Cayman main fund annually, which have been signed-off by an auditor approved by CIMA and where it is clearly outlined the private funds that are included in the consolidated financial statements, along with the FAR for each of the private funds.

In respect of options 2 above, there are no regulatory obligations under the PFL for the non-Cayman main fund or any other non-Cayman entities that are included in the consolidated financial statements submitted, but which are not subject to CIMA’s regulatory oversight.

The PFL defines a “private fund” as a company, unit trust or partnership whose principal business is the offering and issuance of its investment interests, the purpose or effect of which is the pooling of investor funds with the aim of spreading investment risks and enabling investors to receive profits or gains from such entity’s acquisition, holding, management or disposal of investments, where:

          (a) the holders of investment interests do not have day-to-day control over the acquisition, holding, management or disposal of the investments; and

          (b) the investments are managed as a whole by or on behalf of the operator of the private fund, directly or indirectly, for reward based on the assets, profits or gains of the company, unit trust or partnership.

   

It does not include:

        (a) a person licensed under the Banks and Trust Companies Law (2020 Revision) or the Insurance Law 2010;

        (b) a person registered under the Building Societies Law (2020 Revision) or the Friendly Societies Law (1998 Revision); or

        (c) any non-fund arrangements.

The Rule: Segregation of Assets – Registered Private Funds does not prohibit prime brokerage/custody arrangements that allow, in accordance with established and accepted industry practice, a custodian/sub-custodian to hold all client assets in a commingled client omnibus account along with the assets of other clients. 

  1. The following characteristics, if all of them are exhibited by an undertaking, should show that the undertaking is a collective investment scheme for the purposes of the PFL.
  2. The characteristics are that: (a) the undertaking does not have a general commercial or industrial purpose; (b) the undertaking pools together capital raised from its investors for the purpose of investment with a view to generating a pooled return for those investors; and (c) the unitholders or shareholders of the undertaking – as a collective group – have no day-today discretion or control.
  3. The fact that one or more but not all of the aforementioned unitholders or shareholders are granted day-to-day discretion or control should not be taken to show that the undertaking is not a collective investment scheme.

  1. Taking as an example, a Segregated Portfolio Company (“SPC”), where there is a single investor in each underlying Segregated Portfolio (“SP”), fund operators should not consider that the absence of all, or any one of the characteristics under each of the concepts in the definition of a private fund under the PFL (for example the ‘offering and issuing of investment interest’, ‘pooling of investor funds”, or ‘spreading of investment risks’), as set out in these FAQs, conclusively demonstrates that a SPC or an underlying SP does not fall under the relevant concept. 
  2. It should also be noted that where an investment compartment, that is itself a separate legal entity and which in its own right meets the definition of a private fund pursuant to the PFL, then it would be expected that such investment compartment is separately registered under the PFL.  

  1. The commercial activity of taking direct or indirect steps by a private fund or a person or entity acting on its behalf (typically, the investment manager) to procure the transfer or commitment of capital by one or more investors to the private fund for the purpose of investing it in accordance with its offering document or summary of terms, should amount to the activity of offering and issuing investment interests.
  2. For the purpose of the previous paragraph, it should be immaterial whether- (a) the activity takes place only once, on several occasions or on an ongoing basis; (b) occurs through only one of the entities within a multi-fund/related fund entities structure; or (c) the transfer or commitment of capital takes the form of subscriptions in cash or in kind.
  3. Without prejudice to the above paragraphs, when capital is invested in a private fund by an existing investor, this is not likely to be within the scope of raising capital.

Yes.  Where the constitutive documents of the private fund, or any other provision or arrangement of binding legal effect, expressly states that the fund only has and is only intended to ever have a single investor of record.

  1. Taking as an example, collective investment schemes that have only one investment/ one type of investment, fund operators should not consider that the absence of all or any one of the characteristics under each of the concepts in the definition of “private fund” in the PFL (for example the ‘offering and issuing of investment interest’, ‘pooling of investor fund”, or ‘spreading of investment risks’) conclusively demonstrates that a collective investment scheme does not fall under the relevant concept.

  2. The nature of the investment(s) into which investors’ pooled funds are placed should not be the sole consideration for whether or not a private fund, pursuant to the PFL, has been created. 

Applications are submitted electronically though CIMA’s secure Regulatory Enhanced Electronic Forms Submission (REEFS) web portal.

CIMA requires the following:

  • REEFS Application Form (APP-101-77);
  • Certificate of Incorporation/Registration (as applicable);
  • Constitutive Documents (Memorandum & Articles of Association/Trust Deed/Declaration of Partnership (as applicable);
  • Offering Memorandum/Summary of Terms/Marketing Material (as applicable);
  • Auditor’s letter of consent;
  • Administrator’s letter of consent (if applicable);
  • Structure Chart;
  • Application Fee

  1. The Authority requires details of the terms of the offer to investors for making an investment in the private fund. 
  2. The Authority understands that a number of the private funds currently in existence do not have a separate offering document, summary of terms or marketing materials and that the terms of the offer are outlined in the constitutive documents of the private fund.  In these circumstances, a private fund must provide at the time of registration its constitutive documents and any subsequent changes made thereto.

  1. No.  In these circumstances, the private fund need only file the offering document, summary of terms or marketing materials at the time of registration.
  2. However, the Authority reserves the right to request a copy of the private fund’s constitutive documents if the Authority determines that the offering document, summary of terms or marketing materials filed does not contain all of the relevant information on the terms of offer or determines that the constitutive documents are necessary for it to discharge its supervisory or other legal obligations, duties or functions.

 

All documentation (as outlined above) and payment must be submitted to CIMA before the processing of the application will commence.

A Private Fund’s registration application will be rejected where the documentation submitted is incorrect or incomplete.  Please see the following Notice for further information.

  1. Private Funds submitting complete applications, where there are no adverse findings in respect of the information submitted, will be processed and approved within the stated timeline.
  2. Factors that might impact registration turnaround time include:

             (a) Adverse findings from the fitness and propriety checks conducted on the fund’s operators or officers; and/or

             (b) Fund/related group entities/operators/officers being the subject of an ongoing regulatory or criminal investigation.

The registration date of a Private Fund will be the date that a complete application has been received by CIMA - i.e. the submission date when the Private Fund has submitted all documents, fees and information as required pursuant to the PFL.

Yes.  A minimum of two (2) directors are required for applicants that are companies.

Yes.  CIMA will require a minimum of two (2) natural persons to be named in respect of a general partner or corporate director of a Private Fund.

  1. Yes.  A copy of the marketing materials, summary of terms or offering document will be required upon registration.
  2. The Authority understands that a number of the private funds currently in existence do not have a separate offering document, summary of terms or marketing materials and that the terms of the offer are outlined in the constitutive documents of the private fund.  In these circumstances, a private fund must provide at the time of registration its constitutive documents and any subsequent changes made thereto.

No.  AIV entities will not require a separate registration. However, information in respect of each such entity will be collected at the time of registration, with any changes to such information to be reported to the Authority as a part of the ongoing obligations of the Private Fund.

A Cayman AIV that meets the definition of a Private Fund will be required to register under the PFL as a stand-alone Private Fund.

A Private Fund that completes its liquidation/winding-up prior to the end of the transition period will not be required to apply for registration pursuant to the PFL. The completion of the liquidation/winding-up process means that the private fund has disposed of all its investments and has made final investor distributions.

A Private Fund, pursuant to section 13(1) of the PFL, is required to have its accounts audited annually by an auditor approved by CIMA.  The Private Fund is also required to submit its audited accounts, along with the Fund Annual Return (“FAR”), to CIMA within six months of the end of each financial year.

Yes.  All Private Funds that were active as at 7 February 2020, or were registered subsequent to that date (including prior to the end of the transitional period (7 August 2020)), are required to submit audited accounts and FAR for the 2020 financial year within six (6) months of their financial year-end (“FYE”).  The audited accounts are subject to the local audit sign-off requirement.

Private funds with a FYE that fall between 7 February 2020 to 31 July 2020 will be granted an additional three months in which to file their audited accounts and FAR (ex. FYE - February 2020, to be filed by November 2020 instead of August 2020). 

  1. The valuation of the assets of a Private Fund should be conducted in accordance with the Private Fund’s valuation policy. Valuations of a Private Fund should be carried out on at least on an annual basis.
  2. CIMA will issue rules establishing the policies and procedures of CIMA with respect to the valuation of the assets of a Private Fund.

Yes.  Good market practice is for a fund to ensure that their investors are kept abreast of the performance of the fund.  CIMA is of the view that while investors are aware that any capital contributions made into a Private Fund will not be distributed until the timeframe indicated in the relevant fund documents has been completed, investors should still be made aware of the fund’s performance on an ongoing basis.   The PFL provides for various ways in which this obligation can be met.

  1. A Private Fund has a choice of whether to conduct this function internally (by the investment   manager) or to hire a third-party service provider to ensure that this function is carried out.
  2. Should this function be conducted internally, the Private Fund’s Operator should engage the Private Fund’s auditor, when signing off the audited financial statements, to provide confirmation that the cash monitoring was done throughout the year.

  1. CIMA’s assessment of the process undertaken by the Private Fund, in respect of cash monitoring, will seek to confirm that such process, based on the investment strategy of the fund, is sufficient having regard to the type of assets held by the Private Fund.
  2. CIMA will issue rules establishing the policies and procedures with respect to the cash monitoring requirements of a Private Fund.

All regulated funds are subject to ongoing monitoring by CIMA and, in keeping with CIMA’s current approach, matters will be addressed as they arise in the manner commensurate with the level of seriousness of the breach.

Mutual Funds (Amendment) Law 2020

The Rule: Segregation of Assets – Regulated Mutual Funds does not prohibit prime brokerage/custody arrangements that allow, in accordance with established and accepted industry practice, a custodian/sub-custodian to hold all client assets in a commingled client omnibus account along with the assets of other clients.

Funds that wish to convert from being registered under section 4(4) to section 4(3) of the Mutual Funds Law must comply with the minimum initial investment requirement.  Accordingly, these funds are required to demonstrate this by providing an affidavit attesting the same.  Any investor that initially invested below the minimum initial investment requirement must increase their investment or be redeemed out prior to the fund converting/registering under section 4(3) of the Mutual Funds Law, unless the investor’s current investment meets the minimum initial investment.

Application forms APP-101-78 and 101-79 are currently submitted in excel format via email to Registrations@cima.ky

All documentation (as outlined above) and payment must be submitted to CIMA before the processing of the application will commence.

A Limited Investor Fund’s registration application will be rejected where the documentation submitted is incorrect or incomplete. See Notice for further information.

The registration date of a Limited Investor Fund will be the date that a complete application has been received by CIMA - i.e. the submission date when the Limited Investor Fund has submitted all documents, fees and information as required pursuant to the Mutual Funds Law.

Yes. A minimum of two (2) directors are required for applicants that are companies.

Yes.  CIMA will require a minimum of two (2) natural persons to be named in respect of a general partner or corporate director of a Limited Investor Fund.

Yes.  A copy of the marketing materials, summary of terms or offering document will be required upon registration.

A Limited Investor Funds, pursuant to section 8 of the Mutual Funds Law (2020 Revision), is required to have its accounts audited annually by an auditor approved by CIMA. The Limited Investor Fund is also required to submit its audited accounts, along with the Fund Annual Return (“FAR”), to CIMA within six months of the end of each financial year.

Yes.  A Limited Investor Fund is required to submit an audit for its 2020 financial year within six months of the financial year end or within such extension of that period as the Authority may allow.

Mutual Fund Administrators (“MFA”) - General Questions/Definitions

Mutual fund administration means the management, including control of all, or substantially all, the assets of a mutual fund, or the administration of a mutual fund, or the provision of the principal office of the mutual fund in the Cayman Islands, or the provision of the operator to a fund.

A principal office is the office of the fund maintained by a licensed Mutual Fund Administrator. It performs the administrative functions of the fund, including the calculation of the net asset value (NAV) and the subscription/redemption of shares. Other responsibilities include maintaining the fund's corporate and financial records, communicating with investors as well as acting as a liaison between the fund and the Authority.

Yes. Where a licensed mutual fund administrator is a company, the company shall not issue shares, and a person owning or having an interest in shares in the company shall not transfer, dispose of or deal with those shares or interest, unless CIMA has given permission.

An administrator's letter of consent is one that indicates acceptance of appointment as administrator, states the name of the fund and a summary of services to be provided.

A list of mutual fund administrators licensed by the Cayman Islands Monetary Authority may be viewed on the  Funds’ Statistics and Regulated Entities page of this website.  The list is updated quarterly.

Mutual Fund Administrators (“MFA”) - Licensing

The information and particulars to be contained in an application for a Mutual Fund Administrator's licence are contained in the Mutual Fund Administrators Licence (Applications) Regulations 2001. Applications are submitted electronically though the Authority’s secured Regulatory Enhanced Electronic Forms Submission (REEFS) web portal, which is only accessible by authorized service providers. For more information, see licensing requirements and REEFS FAQs.

In determining whether a person is "fit and proper" the Authority will consider a person's: - (a) honesty, integrity and reputation; (b) competence and capability, and (c) financial soundness.  The Authority has issued guidance on this matter. To access these, click on the link:  Rules, Statement of Guidance page.

It takes approximately 6-8 weeks to obtain a Mutual Fund Administrator's Licence.

Mutual Fund Administrators (“MFA”) - Updates/Filings

Documentation required for adding a director:

  • A police clearance certificate / affidavit of no convictions;
  • one financial reference and two personal references ;
  • A Personal Questionnaire, completed; and
  • Application fee of CI$1,000/US$1,219.51.
Mutual Fund Administrators (“MFA”) - Revocation

The core documents to be submitted are as follows:

  • The original Mutual Fund Administrator’s Licence issued by the Authority for cancellation or in the case of a lost Licence, an affidavit signed by an operator, stating that the Licence will be returned to the Authority if found;
  • A fee of CI$600.00 payable for the surrender of the Licence;
  • A certified copy of the directors’ resolution to cancel the MFA licence, duly signed and dated by the directors.

The other documents to complete the revocation/cancellation process are as follows:

  • An affidavit from the directors which verifies the following:
    • The MFA no longer conducts mutual fund administration business as defined by the Mutual Funds Law;
    • The date in which such mutual fund administration business ceased; and
    • The MFA has not been wound up in a manner prejudicial to its creditors. 
    • That the MFA has operated in accordance with its Memorandum & Articles.
  • Clarification as to whether funds under administration (if any) will be terminated or transferred to another administrator together with evidence of the termination and/or transfer (evidence includes consent letters from the new administrator, updated OMs from the funds or the novation agreements if available);
    • For funds that are transferring to another licensed mutual fund administrator, evidence that the funds have been transferred
  • Audited Financial Statements covering from the date of the last financial year end to the date the Licensee has ceased to provide mutual fund administrative services;
  • Stamped copies of the CWR Forms 19 and 20 which are filed with the Registrar of Companies (where a liquidator has been appointed); and
  • A copy of the liquidator’s report (if applicable) or confirmation from the Company’s auditor that the Company has no outstanding liabilities or creditors.

In addition to the above listed items, the MFA should be in “good-standing” with the Authority. The Authority may have further questions, seek further clarification and request additional documentation.

Directors - General queries

Applications will only be accepted through the director portal https://gateway.cimaconnect.com . Once you receive your Unique ID, you can log onto the director portal. On your first login you will be required to set your password.

No. Applications will only be accepted via the director portal. Any application received from any other means will not be processed, and will be destroyed by the Authority.

No. This database will be maintained by the Authority in accordance with the confidentiality provisions under section 50 of the Monetary Authority Law (2018 Revision). In practice, this means that your information will not be made available to the public, and your information is protected from freedom of information requests. However, the public will be able to search for your name to see whether you have been registered or licensed in accordance with the Law. The results of any search for your licence or registration status will only show your name, the type of registration or licence you hold, your registration/licence number and the date on which you were licensed or registered. While the creation of a public database has been discussed, it does not form part of this Law.

The registered office of each covered entity will receive a list from the Authority containing unique identification numbers for all of the directors that are associated with the covered entities of that registered office. The registered offices will contact each director and supply that director with the unique identification number (note that a director may receive the same unique number from a variety of registered offices; you should expect this and disregard any duplicates). The registered offices will also let you know the correct website address to register at. If you have not received your information from the registered office, you may contact the Authority directly at DirectorsRegistration@cima.ky.

You will need to contact the Authority directly at DirectorsRegistration@cima.ky. The relevant Division will be able to provide you with the correct number.

You will need to contact the Authority directly at DirectorsRegistration@cima.ky. The relevant Division will be able to provide you with the correct number.

If you know you have a complicated history, the Authority asks that you apply as early as possible to make sure that their application is processed within the application periods. You may not think you have a complicated history, but the application process may show that you do. You must apply as soon as possible.

No. A Registration is limited to natural persons acting on fewer than 20 covered entities. You need only apply for a licence as a professional director.

You can send an email to DirectorsRegistration@cima.ky. You will be contacted by the Authority’s Investments Supervision Division.

No. If you have a licence, you do not need to be registered as well. Similarly, if you are registered and do not act on more than 20 directorships of covered entities, you do not need to be licensed. You are required to be either licensed or registered, but not both.

You should seek independent legal advice from your Cayman Islands attorneys. They will be able to advise you on how to proceed. Even if you do fall within one of the exceptions for licensing as a professional director, you will still need to register under Part II of the Law.

The covered entities have an obligation to notify the Authority of any changes to its board of directors. You will need to liaise with your covered entities to ensure that they have duly notified the Authority of your resignation(s). You must also log on to the Director Portal and manage your directorship. All directorship change request (Appointment, resignation or surrender request) must be submitted through the director portal.

  • Submit a Directors' Resolution (implementing the director’s resignation from the Board); and
  • Submit a certified copy of the director’s death certificate.
  • The Authority will also accept the entity’s Memorandum and Articles of Association in place of the Directors’ Resolution if it contains death as one of the reasons for which a Director’s office may be vacated. When submitting this document, it must be supported by the updated Register of Directors

  • You will need to sign into the Portal and complete the information under “Change Category or Surrender” and pay the surrender fee of CI$600. You will also need to pay the application and annual fee for the licensed professional director and complete the application form.
  • Once the Authority has received your application, you will be required to submit a letter to the Authority confirming that you have notified all of the covered entities you act as a director for that you have applied for a licence as a professional director. The Authority will then process your application for a licence in accordance with the usual process.

  • You will need to sign into the Portal and complete the information under “Change Category or Surrender” and pay the surrender fee of CI$800. You will also need to pay the application and annual fee for the registered director and complete the application form.
  • Once the Authority has received your application, you will be required to submit a letter to the Authority confirming that you have notified all of the covered entities you act as a director for that you have applied for registration as a director. The Authority will then process your application in accordance with the usual process.
Directors - Purpose/Application of Law

Applications will only be accepted through the web portal. Once you receive your Unique ID, you can log onto the web portal. On your first login you will be required to set your password.

This Law only applies to directors of companies that are:

  • Registered under the Mutual Funds Law as a regulated mutual fund; or
  • Companies falling under section 5(4) AND paragraphs 1 and 4 of the Fourth Schedule of the Securities Investment Business Law.

You should seek independent legal advice from your Cayman Islands attorneys. They will be able to advise you on how to proceed.

The Cayman Islands Monetary Authority is in the process of developing industry guidance on capacity. In line with previous announcements, this guidance is not expected until 2015. The guidance will be prepared in accordance with the requirements of the Monetary Authority Law.

If you have committed an offence under the Law the Authority will refer your matter to the Director of Public Prosecutions or the Attorney General’s chambers. The Director of Public Prosecutions or the Attorney General will then determine how to proceed.

All information provided to the Authority by you is considered material and will be treated accordingly. The Authority expects that, if there is any change to the information provided to the Authority, you will update all of the information that you provide to the Authority within 21 days (as provided in the Law). If there are no changes to the information you provided to the Authority, you will be asked to confirm that at the time that you submit your annual fee.

The Authority needs to see all of the information that it receives about any disciplinary or court action against you so that it can make a determination on whether your application is sufficient.

The following information is required:

  • Submit a Directors' Resolution (outlining the director’s resignation from the Board); and
  • Submit a certified copy of the director’s death certificate.
  • The Authority will also accept the entity’s Memorandum and Articles of Association in place of the Directors’ Resolution if it contains death as one of the reasons for which a Director’s office may be vacated. When submitting this document, it must be supported by the updated Register of Directors. 

A director on my covered entity has been declared mentally incompetent. What do I do?

Contact the Authority directly for further assistance.

If a Fund is in LUT, can all the directors resign?

Directors who are on a LUT entity are required to remain on the fund until the de-registration process is completed if no liquidator has been appointed. If the LUT process is not completed by the New Year, the directors are required to pay the annual director’s registration fee for that New Year.

If a Fund is in LUL, can all the directors resign?

Directors who are on a LUL entity are normally removed from the entity when a Liquidator is appointed. On the appointment of a liquidator all the powers of the directors’ cease.  However, directors are required to pay the annual director’s registration fee for the New Year if they’re continuing to act in the capacity of a director. If not, the director will need to log onto the Director Portal and surrender their directorship accordingly.

Directors - Fees

On your initial application, you will have to pay your application fee and first year fee at the time of your application through the website. On or before 15 January of each year after your application is accepted, you will have to pay your annual fee.

If you pay your annual fee after 15 January of any year after your application is accepted, you will have to pay that annual fee plus a penalty (of 1/12 the relevant annual fee for each month that the annual fee remains outstanding). Further information is available by emailing directorfees@cima.ky

You can send an email to directorfees@cima.ky. You will be contacted by the Authority’s Finance Division.

Payment will only be accepted via the web portal. The web portal accepts debit and credit cards from Visa and MasterCard. Payment received by any other method will be returned at the sender’s costs. Please note that, should you choose to pay with a Visa debit or MasterCard debit card, your financial institution may charge you a higher exchange rate. The Authority will not refund the difference.

Directors - Surrender

You will need to sign into the Portal and complete the information under “Surrender” and pay the surrender fee of CI$600.

Once you have paid the fee, you will be required to confirm the following on the Portal: 

  • that you have resigned as a director of all covered entities,
  • that you no longer plan to act as a director on covered entities, and 
  • that if you would like to act on any other covered entity or wish to resume directorship services after you have surrendered your registration, you will need to re-apply under the DRLL.

Changes must be made to covered entities within the Director Gateway Portal within the “Manage Directorships” section. The request within the Portal must accompany the required information. One of the following documents are required: 

  • A resignation letter from the retiring Director;
  • Resolution confirming the change in Director; or
  • An updated Register of Director (“ROD”).

If you are still a director on a covered entity on 31 December, we will be unable to process your application for surrender for that calendar year. You will be liable for fees for the next calendar year.

You will need to sign into the Portal and complete the information under “Surrender” and pay the surrender fee of CI$800. Once you have paid the fee, the appropriate Division will contact you on your next steps.

If your company is still a director on a covered entity on 31 December, we will be unable to process its application for surrender for that calendar year. Your company will be liable for fees for the next calendar year.

Directors - Registered Directors (1 – 19 covered entities)

Applicants for registration will be required to provide:

  • full legal name
  • date and place of birth
  • nationalities principal and postal addresses
  • personal email address and telephone number
  • whether you have been convicted of a criminal offence involving fraud or dishonesty
  • whether you are the subject of an adverse finding, financial penalty, sanction, disciplinary action or proceeding by a regulator, self-regulatory organisation or a professional disciplinary body.

Applicants should receive confirmation of registration within 48 hours.

In these instances, it means that the Authority requires additional information from you before your application can be finalised. If you are a director on covered entities on the date that the Law comes into force, then you can continue to act as a director on those entities until the Authority processes your application. If you are not a director on the date that the Law comes into force, then you may not act as a director until the Authority processes your application. It is therefore recommended that you apply for registration well in advance of the launch date of your covered entity.

If your application is at risk of being refused, the Authority will contact you and provide you with reasons why your application may be refused and provide you with an opportunity to make representations. If your application is subsequently refused, you will be contacted by the Authority and notified of the refusal for your application. If you are a director on the date the Law comes into force and your application for licensing is refused, you will be able to take advantage of the reconsideration request procedure set out in section 26 of the Law.

You will receive a notice from the Authority providing you with confirmation of registration. In order to maintain good standing, you will be required to pay an annual fee no later than 15 January of each year and reconfirm the information provided by you at the time of your application.

You will be required to apply for a licence prior to taking on your 20th covered entity. You can act for more than 19 entities pending approval of your application. If your licence is approved, you will be required to surrender your registration and pay the appropriate surrender fee (with certain exemptions). The application and first year annual fee that you submitted for your registration will not be refunded. If your application is refused, the Authority will be in contact with you to plan a course of action.

You can send an email to DirectorsRegistration@cima.ky. You will be contacted by the Authority’s Investments and Securities Division.

  • You will need to sign into the Portal and complete the information under “Change Category or Surrender” and pay the surrender fee of CI$600 (with certain exemptions). You will also need to pay the application and annual fee for the licensed professional director and complete the application form.
  • Once the Authority has received your application, you will be required to submit a letter to the Authority confirming that you have notified all of the covered entities you act as a director for that you have applied for a licence as a professional director. The Authority will then process your application for a licence in accordance with the usual process.
Directors - Professional Directors (20 or more covered entities)

Applications will only be accepted through the director portal. Once you receive your Unique ID, you can log onto the director portal. On your first login you will be required to set your password.

You can send an email to DirectorsLicensing@cima.ky. You will be contacted by the Authority’s Fiduciary Division.

No. Licensing as a professional director is limited to natural persons. Companies must apply for a licence as a corporate director.

No. If you have a licence, you do not need to be registered as well. Similarly, if you are registered and do not act on more than 20 directorships of covered entities, you do not need to be licensed. You are required to be either licensed or registered, but not both.

Applicants for licensing will be required to provide:

  • full legal name
  • date and place of birth
  • nationalities
  • principal and postal addresses
  • email address and telephone number
  • a fully completed Personal Questionnaire
  • three reference letters, at least one of which must be from a bank
  • a copy of a recent police clearance certificate.

Applicants should receive confirmation of licensing within four weeks.

In these instances, it means that the Authority requires additional information from you before your application can be finalised. If you are a director on covered entities on the date that the Law comes into force, then you can continue to act as a director on those entities until the Authority processes your application. If you are not a director on the date that the Law comes into force, then you may not act as a director until the Authority processes your application. It is therefore recommended that you apply for your license well in advance of the launch date of your 20th covered entity.

If your application is at risk of being refused, the Authority will contact you and provide you with reasons why your application may be refused and provide you with an opportunity to make representations. If your application is subsequently refused, you will be contacted by the Authority and notified of the refusal for your application. If you are a director on the date the Law comes into force and your application for licensing is refused, you will be able to take advantage of the reconsideration request procedure set out in section 26 of the Law.

You will receive a notice from the Authority providing you with confirmation of licensing. In order to maintain good standing, you will be required to pay an annual fee no later than 15 January of each year and reconfirm the information provided by you at the time of your application.

You may retain your license or choose to apply for registration as a director. You can act for more than 19 entities pending approval of your application for registration. If your registration is approved, you will be required to surrender your registration, pay the appropriate surrender fee, and ensure that you are acting for no more than 19 entities. The application and first year annual fee that you submitted for your licence will not be refunded. If your application is refused, the Authority will be in contact with you to plan a course of action.

  • You will need to sign into the Portal and complete the information under “Change Category or Surrender” and pay the surrender fee of CI$800. You will also need to pay the application and annual fee for the registered director and complete the application form.
  • Once the Authority has received your application, you will be required to submit a letter to the Authority confirming that you have notified all of the covered entities you act as a director for that you have applied for registration as a director. The Authority will then process your application in accordance with the usual process.

You must be covered by a plan that has D&O insurance. This can be a plan you get on your own, one that is offered by the covered entities you act on, part of a group plan, or any other acceptable coverage. Insurance does not have to be from a Cayman Islands insurer but should be from a reputable insurer familiar with this type of insurance.

You should seek independent legal advice from your Cayman Islands attorneys. They will be able to advise you on how to proceed. Even if you do fall within one of the exceptions for licensing as a professional director, you will still need to register under Part II of the Law.

No. Licensing as a professional director is limited to natural persons. Companies must apply for a licence as a corporate director.

No. Registration is limited to natural persons. Companies must apply for a licence as a corporate director.

Applications will only be accepted through the web portal. Once you receive your company’s Unique ID, you can log onto the web portal. On your first login you will be required to set your password.

The following companies may apply for a licence as a corporate director:

  • ordinary companies registered under the Companies Law (2018 Revision)
  • ordinary non-resident companies
  • registered under the Companies Law (2018 Revision)
  • exempted companies registered under the Companies Law (2018 Revision)
  • foreign companies registered under the Companies Law (2018 Revision)
  • Companies that do not fall under one of the above categories cannot act as a director on any covered entity.

All companies, no matter the number of covered entities they act on, must hold a licence under the Law, a companies management licence or a mutual fund administrators licence.

No. Corporate directors holding a companies management licence or a mutual fund administrators licence do not need a licence under this Law.

The corporate director will need to provide:

  • evidence that it is duly incorporated, and registered as a foreign company (if applicable)
  • evidence of its shareholders or members (usually by way of a register of shareholders or members)
  • evidence of its directors (usually by way of a register of directors)
  • memorandum and articles of association or equivalent
  • if a foreign company, evidence that it is in good standing in its home country
  • a list of all of the parent companies and subsidiary companies in its structure, and the registered and principal offices of each company.

The following information will be required:

  • The natural persons sitting on the board of the corporate director, or beneficially owning more than 10% of the voting interests in the corporate director, are required to provide:
  • full legal name
  • date and place of birth
  • nationalities
  • principal and postal addresses
  • email address and telephone number
  • a fully completed Personal Questionnaire
  • three reference letters, at least one of which must be from a bank
  • a copy of a recent police clearance certificate.

Applicants should receive confirmation of licensing within four weeks.

In these instances, it means that the Authority requires additional information from the corporate director or its shareholders/directors before its application can be finalised. If the corporate director is a director on covered entities on the date that the Law comes into force, then it can continue to act as a director on those entities until the Authority processes your application. If the corporate director is not a director on the date that the Law comes into force, then it may not act as a director until the Authority processes its application. It is therefore recommended that the corporate director apply for its license well in advance of the launch date of your covered entity.

If the application is at risk of being refused, the Authority will contact the corporate director and provide it with reasons why its application may be refused and provide you with an opportunity to make representations. If its application is subsequently refused, the corporate director will be contacted by the Authority and notified of the refusal for its application.

The corporate director will receive a notice from the Authority providing you with confirmation of licensing. In order to maintain good standing, the corporate director will be required to pay an annual fee no later than 15 January of each year and reconfirm the information provided by it at the time of its application.

It must be covered by a plan that has D&O insurance. This can be a plan it gets on its own, one that is offered by the covered entities it acts on, part of a group plan, or any other acceptable coverage. Insurance does not have to be from a Cayman Islands insurer, but should be from a reputable insurer familiar with this type of insurance.

You can send an email to DirectorsLicensing@cima.ky. You will be contacted by the Authority’s Fiduciary Division.

No. You Registration is limited to natural persons acting on fewer than 20 covered entities. You need only apply for a licence as a professional director.

No. Licensing as a professional director is limited to natural persons. Companies must apply for a licence as a corporate director.

REEFS Filings

The REEFS Portal currently creates audit filing rows (for the 2014 and 2015 audit periods) for newly registered regulated mutual funds. If the visible audit filing rows within the REEFS Portal do not apply to a newly registered regulated mutual fund, please disregard them until the Authority removes them.

The Authority requires an e-mail from the regulated mutual fund’s approved auditor (the request must be sent via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line) which clearly explains the issue. The Authority will review the concern and it will revert to the regulated mutual fund’s approved auditor with information as soon as possible. A few common scenarios are:

  • A regulated mutual fund has officially changed its auditor and it has not duly notified the Authority of the change.
  • A regulated mutual fund has officially changed its auditor and it has not duly notified the Authority of the change.
  • A regulated mutual fund has officially changed its auditor and it has not duly notified the Authority of the change.

No. The Authority will not amend any audit row periods within the REEFS Portal to enable approved auditors to receive specific audit period confirmation e-mails. A regulated mutual fund’s audit filings must be submitted in the relevant financial year’s audit filing row within the REEFS Portal.

The REEFS Portal automatically generates a regulated mutual fund’s audit filing row at the end of each financial year, and as a result, the approved auditing firm should submit the regulated mutual fund’s audit filings in the relevant financial year’s audit filing row (even if the audit filings cover a period of less than 12 months, or, more than 12 months up to a maximum of 18 months).

No. The Authority will not amend any audit row periods within the REEFS Portal to enable approved auditor to receive specific audit period confirmation e-mails. A regulated mutual fund’s audit filings must be submitted in the relevant financial year’s audit filing row within the REEFS Portal. The REEFS Portal automatically generates a regulated mutual fund’s audit filing row at the end of each financial year, and as a result, the approved auditing firm should submit the regulated mutual fund’s audit filings in the relevant financial year’s audit filing row (even if the audit filings cover a period of less than 12 months, or, more than 12 months up to a maximum of 18 months).

The Authority requires an e-mail from the Operator(s), or, the regulated mutual fund’s approved auditor (the request should be sent via e-mail to EReporting@cima.ky with the full legal name of the regulated mutual fund and the purpose of the e-mail explicitly specified in the subject line) which clearly states the reason(s) why the specific set of audited financial statements (and the associated fund annual return) need to be rejected by the Authority. The Authority will consider the request and will communicate its decision back to the submitter via e-mail. If the Authority does perform the audit filings’ rejection, it requires that only the reason(s) for the audit filings’ rejection be addressed before the re-submission. There is no application fee to request the rejection of previously submitted (via the REEFS Portal) audit filing on behalf of a regulated mutual fund. Furthermore, a regulated mutual fund will not accrue an additional Fund Annual Return Filing Fee when it resubmits (via the REEFS Portal) a previously submitted audit filing.