The European Lawyer Investment Funds Guide - Cayman Chapter

2013年 9月 15日

This article was published in The European Lawyer Investment Funds Guide, September 2013


The Cayman Islands (Cayman) is the leading offshore jurisdiction for mutual funds of all kinds: closed and open-ended corporate funds, unit trusts and limited partnerships. In particular, it has become the global domicile of choice for the establishment of alternative investment funds such as hedge funds and private equity funds. It has been estimated that approximately 80 per cent of the world’s hedge funds are established in Cayman.

As at 31 December 2012, the number of active regulated funds was 10,841, with over 1,500 being formed in 2012. There are, in addition, a significant number of unregistered funds that fall under available exemptions. There are 12,988 limited partnerships established in Cayman, the majority of which are generally closed-ended private equity funds, with 2,037 being established in 2012.

There are a variety of reasons for the popularity of Cayman for the establishment of investment funds. Principally, it is because Cayman inherited the English common law legal system and, in consultation with industry, tailored and adapted it through legislation so that it provided a prudent, effective and flexible framework. That framework has been developed over decades with the participation of stakeholders including institutions, fund managers, fund service providers, governmental and quasi-governmental bodies and investors. Supporting that framework is a local industry with unparalleled experience in the establishment and maintenance of alternative investment funds; a government who prioritises the finance industry in legislation; and an experienced judiciary.

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