The Cayman Islands Monetary Authority (“CIMA”) outlines below, for your reference, its response to frequently asked questions relating to the registration process and ongoing requirements for Private Funds:
A. Applications are submitted electronically though CIMA’s secure Regulatory Enhanced Electronic Forms Submission (REEFS) web portal.
A. 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 consent1 ;
Administrator’s letter of consent (if applicable);
A. All documentation (as outlined above) and payment must be submitted to CIMA before the processing of the application will commence.
A. A Private Fund’s registration application will be rejected where the documentation submitted is incorrect or incomplete. Please see the following Notice3 for further information.
A. 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.
Factors that might impact registration turnaround time include:
A. 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.
A. Yes. A minimum of two (2) directors are required for applicants that are companies.
A. 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.
A. Yes. A copy of the marketing materials, summary of terms or offering document will be required upon registration.
A. No. AIV entities will not require a separate registration, however, information in regard to 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. A Private Fund that submits evidence (resolutions, auditor confirmation, etc.) to CIMA that its liquidation/winding-up will be completed prior to the end of the transition period will not be required to apply for registration pursuant to the relevant law.
A. 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.
A. Yes. A Private 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.
A. 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. CIMA will issue rules establishing the policies and procedures of CIMA with respect to the valuation of the assets of a Private Fund.
A. 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 aware of the fund’s performance on an ongoing basis. The PFL provides for various ways in which this obligation can be met.
A. 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. Should this function be conducted internally, the Private Fund’s auditor will have to confirm that it was done throughout the year, when signing off the audited financial statements.
A. 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. CIMA will issue rules establishing the policies and procedures with respect to the cash monitoring requirements of a Private Fund.
A. 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.
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