Cayman widens the net but stops short of imposing public access with new Beneficial Ownership Transparency Bill, 2023
For some years there has been significant focus on whether the Cayman Islands would push through the implementation of a public beneficial ownership register which makes it possible for anyone to find out who is the ultimate beneficial owner of a relevant Cayman entity.
While the Cayman Islands government says that they continue to be committed to making beneficial ownership registers open to the public, that position is not due to be implemented under the wording of the new Beneficial Ownership Transparency Bill. The Cayman Islands government has said that, for now, public access to beneficial ownership registers will depend on future parliamentary resolutions.
The change of heart is not surprising given the European Court of Justice ruling in November 2022 that struck down public access for beneficial ownership registries in the EU on the basis of their interference with privacy and data protection rights. Without any major jurisdiction imposing a public beneficial ownership register, we consider that it is unlikely that the Cayman Islands government will go solo and implement a public beneficial ownership register.
Nonetheless, the Beneficial Ownership Transparency Bill does expand the existing scope in the following respects:
- The bill brings exempted limited partnerships and limited partnerships under the regime and removes certain exemptions, aligning with international standards
- Additional information on beneficial owners, such as ownership nature and nationality for individuals, will be required
If the Beneficial Ownership Transparency Bill passes, the current legal obligations will continue to apply until the new provisions are gradually implemented. Simultaneously, the Ministry of Financial Services and Commerce is actively crafting supplementary regulations and guidance, which will be subject to consultation with industry stakeholders, in the near future.
The Beneficial Ownership Transparency Bill along with nine related amendment bills, was published in the Cayman Islands Gazette on 30 August 2023 and will be presented in Parliament in the fourth quarter of 2023.
The official press release can be found here.
The Beneficial Ownership Transparency Bill, 2023 can be found here.
Our blog post on the ruling of the European Court of Justice on the Beneficial Owner Registers can be accessed here.
Additionally, a list of the remaining nine newly published bills can be found below:
- The Companies (Amendment) Bill, 2023
- The Limited Liability Companies (Amendment) Bill, 2023
- The Limited Liability Partnership (Amendment) Bill, 2023
- The Foundation Companies (Amendment) Bill, 2023
- The Mutual Funds (Amendment) Bill, 2023
- The Insurance (Amendment) (No.2) Bill, 2023
- The Companies Management (Amendment) (No.2) Bill, 2023
- The Banks and Trust Companies (Amendment) Bill, 2023
- The Virtual Assets (Services Providers) (Amendment) (No.2) Bill, 2023