Cayman Islands

The Cayman Islands are a British dependency comprised of three islands (Grand Cayman, Cayman Brac, and Little Cayman) located 240 km south of Cuba. The Islands are the fifth largest financial center in the world, due in large part to the lack of direct taxation. As of 2005, more than 70,000 companies were registered in the Cayman Islands, including more than 430 banks and trust companies, 720 captive insurance firms, and 7000 funds. Banking assets in the Islands exceed USD 500 billion. The Cayman Island Stock Exchange opened in 1997.

In recent years, the Cayman Islands have become a hugely popular jurisdiction for managing hedge funds. Approximately eighty percent of the world's hedge funds are based here. Most managers find that the high quality of administration in the Cayman Islands convinces them to locate administration in this jurisdiction. The Cayman Islands provide an environment of flexible legislation coupled with a pool of highly capable professionals familiar with the set-up and administration of funds thereby providing mangers with an exceptional ability to perform in all types of markets.

Cayman Island companies have become increasingly popular vehicles for taking companies public in various world markets. For example, many companies doing business in China use a corporate structure which includes companies formed in the Cayman Islands. Many Chinese companies listed on U.S. markets (including China Medical Technologies, Suntech Power, and Focus Media) are actually Cayman Island companies. By structuring their operations in the Cayman Islands, companies gain a flexible exit strategy (either by initial public offering or acquisition), the possibility of reducing taxes, and reducing the impact of currency exchange controls.

The Cayman Islands are recognized throughout the global community as a sophisticated, mature, and diverse financial center. Accordingly, Cayman companies are the preferred structure for many multinational businesses.

Cayman Islands is one of the most popular jurisdictions for offshore bank licensing (with Panama being second in number of licenses). Cayman Islands are a fully compliant country, which (basically) means it offers no privacy from US tax authorities. There are about 70,000 companies registered in Cayman, along with 350 banks and 700 insurance companies. There is over US $1 Trillion in assets in Cayman banks. The strength of Cayman is the strong financial services available within a zero tax jurisdiction, world market acceptance and trust, an unrestricted offshore license (called Class B in this country) requires a corporate net worth of only $400,000, and the license fee is only $70,000. The concern for some is the lack of privacy from US tax authorities.