In identical announcements on 11 May 2016, Cayman Islands (‘Cayman’) Premier Alden McLaughlin (‘the Premier’) and Minister for Financial Services Wayne Panton (‘the Minister’) confirmed that Cayman will join an initiative (‘the Initiative’) for the development of a global standard for the sharing of beneficial ownership information (‘BOI’). Cayman has also announced it will invite other participants in the Initiative to enter into agreements similar to the Exchange of Notes (‘EoN’) which Cayman agreed with the UK earlier this year.
The Exchange of Notes
Although EoN was signed on 12 April 2016, its provisions have been in force since 8 April 2016. It confirms that the Cayman Islands will implement a central platform which will allow designated Cayman officials to directly obtain and provide details of beneficial ownership of companies incorporated in Cayman to the UK, as required by law and treaty. Information will be accessed via a central technical platform, but beneficial ownership details will remain with the service providers managing them. Information will not be available publically or available directly by any UK or non-Cayman agency. The agreement is reciprocal, which holds the UK to the same standards in cases where Cayman law enforcement officials may need information on companies incorporated in the UK. EoN may be found at the following link: Exchange of information between UK government and the government of the Cayman Islands
Cayman already ahead of the game
The Minister said that for nearly 20 years, Cayman’s system has helped to fight money laundering, tax evasion and illicit finance globally. He and the Premier point to Cayman’s long-standing commitment to promote global tax compliance and its collaboration with other jurisdictions in global anti-corruption initiatives. It has a well-documented commitment to global transparency, with a range of instruments and protocols already in effect. These include:
- tax information exchange agreements with 36 jurisdictions;
- the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, which allows tax information exchange with more than 90 countries;
- automatic data exchange as part of the European Union Savings Directive;
- legislation relating to the US Foreign Account Tax Compliance Act (FATCA) and UK FATCA
- being a member of the Early Adopter’s Group for the Organisation for Economic Co-operation and Development (‘OECD’)’s Common Reporting Standard.
The Premier pointed out Cayman’s record on fighting corruption: ‘For many years Cayman has had in place a strong anti-corruption framework, as evidenced by the extension in 2010 of the OECD Anti-Bribery Convention; and the expected extension of the UN Convention against Corruption, for which Cayman was favourably assessed in 2014’.
While bearer shares in the Cayman Islands have been immobilised since April 2000, Cayman recently introduced The Companies (Amendment) Bill, 2016to completely abolish bearer shares by 13 July2016. The Cayman Government also introduced the The Confidential Information Disclosure Bill, 2016under which The Confidential Relationships (Preservation) Law (2015 Revision) will be replaced with The Confidential Information Disclosure Law 2016. This new law will clarify the mechanisms through which confidential information may be shared with appropriate authorities. New data protection legislation equivalent to that in force in the European Union is due to be introduced in September 2016.
Cayman’s commitment to international collaboration
The Premier concluded ‘We recognise the need for closer collaboration, in line with international standards. We support current initiatives in this regard, and will do our part to promote transparency in order to encourage global tax compliance’
More information and Solomon Harris News Updates on BOI