Cayman Administered Fund

Section 5 (1) of the Mutual Funds Law in the Cayman Islands sets out guidelines for the registration of Administered Funds in the Cayman Islands.

Key Features

The distinctive difference between an administered fund and a registered fund is that there is a statutory obligation upon the administrator to conduct due diligence on the promoter and investment manager so that they can give an undertaking to CIMA.

An administered fund must therefore appoint a fully licensed Cayman Islands fund administrator (as principal office), who must confirm to CIMA that the promoter has a sound reputation, relevant experience and that the fund will be operated in a proper manner.

Legal Requirements

Requirements	Description
General
Corporate  vehicle permitted	Company, Unit Trust or Partnership
Application fee	USD 370
Annual license fee	USD 4,700
Local physical office required	No
Share capital or equivalent
·         Minimum subscription	None
·         Minimum investors	More than 15 investors
Directors
Minimum number	2
Corporate directorship allowed	Yes
Local director required	No
Service Providers Required
Custodian	No
Fund manager/Investment manager	Yes (from anywhere)
Fund administrator	Yes (CIMA-licensed)
Auditors	Yes
Legal Advisers	No

Tax Treatment

Tax neutrality: no capital gains, income, profits, corporation or withholding taxes

Duration to Set Up

About 3 months

Distinctive Benefits of Licence

• No Minimum subscription
• No preapproval required, the registration form (MF2/MF2A) is simply submitted to CIMA together with the offering document, auditors consent letter, the administrators consent letter – there is no waiting period as the fund can offer its shares for sale on the day it files with CIMA.
• The auditor must be a Cayman Islands approved auditor although the audit work does not require to be conducted in the Cayman Islands. It is normal for a foreign audit firm to do the actual audit and for the Cayman Islands office to do a signoff. However a Cayman Islands auditor’s consent letter is required for the CIMA registration.
• There is no requirement to have a custodian, prime broker or Cayman Islands resident director.
• The investment manager can be located anywhere and is not required to be licensed or registered.
• Tax neutrality: no capital gains, income, profits, corporation or withholding taxes

The Valsen Advantage

• End to end comprehensive service
• Speedy and efficient service
• Expert advice on structuring options
• Dedicated ongoing compliance support
• Extensive network pool of service providers