Cayman Islands Financial Reporting Authority reminds relevant institutions of obligations under the financial sanctions regime

The Cayman Islands Financial Reporting Authority (CAYFIN) has issued a public notice (theNotice) to all relevant institutions, businesses and professionals of their obligations under the financial sanctions regimes in the Cayman Islands. A copy of the Notice can be foundhere.

The UK Government passes Overseas Territories Orders-in-Council implementing various United Nations and European Union sanctions and extending such sanctions to its British Overseas Territories (including the Cayman Islands). These Orders-in-Council have the force of law in the Cayman Islands and a breach of them can result in a criminal offence where fines or other criminal convictions can be imposed. The Cayman Islands can also impose its own domestic financial sanctions in certain circumstances.

The Notice highlights the prohibitions relating to asset freezes, the reporting obligations on relevant institutions, businesses or professionals, how to report to the competent authority (ie the Governor using the office of CAYFIN) and the applicable offences and penalties.

The Cayman Islands courts have also dealt with the sanctions regime in the case of Palladyne International Asset Management B.V. v. Upper brook (A) Ltd and Others (February 2019). A copy of our note in the case can be found here.