Offshore Fund Services

You do what you do best
Rely on us to take care of the rest

Setup or domicile your fund in the Cayman Islands without missing  your stride

We can provide you with everything you need including Professional Independent Directors, Registered Office, Compliance Officers, Anti Money Laundering Reporting Officers, as well as introductions to Onshore and Offshore Lawyers,  Auditors, 

Fund Administrators, Bankers and  Regulators,

Why choose IMS and the Cayman Islands?

  • IMS has long been a pioneer in the world of services to offshore financial and other entities. We recognised early on the potential for the funds industry in the Cayman Islands to grow the jurisdiction to become a premier financial centre, ranking only behind the likes of London and New York.

  • We were the first  in the Cayman Islands to specialise in providing independent directors to hedge funds. Our services comply with the Cayman Islands Director Registration and Licensing Law (the Law) and we pride ourselves on being a premier firm in the space– many other providers of director services have modelled themselves on us.

  • In a nutshell, the Cayman Islands has ensured its strong position by providing a balanced regulatory approach with a legal system based on English common law, which, coupled with its inherent political stability has meant that the jurisdiction has been, and continues to be, attractive to domicile a hedge fund structure. Licensing and regulatory requirements do not require local custodians or investment managers, as it is accepted that relevant stakeholders are suitably regulated or controlled either in or outwith the Cayman Islands.

  • Bearing in mind that hedge funds are aimed squarely at professional, institutional and sophisticated investors, the law in the Cayman Islands does not place restrictions on investment objectives, risks, leverage or other commercial matters etc., provided the fund offering documents fully describe the same as well as the equity interests investors may subscribe for.

  • Please view the other pages within this Cayman Funds section of our site to fully appreciate the benefits of domiciling your hedge fund in the Cayman Islands.

  • To find out more about the Cayman Islands fund directors and our Hedge Fund services, please email us at contactus@ims.ky.

 

IMS Fund Services

  • IMS Fund Services is a division of IMS, which focuses on the provision of directors, trustees, governance committee members and AML Officers to hedge funds and related entities. We have over 150 years of collective experience and expertise in global funds governance in Cayman and provide services to some of the largest global fund organizations.

  • Our Fund Fiduciaries are professionally qualified and are recruited from household names in the financial services industry.  IMS is not only independent of the investment manager but also independent of the administrator and all other service providers to the funds for which we provide directors, governance committee members  or trustees.

  • Our model provides inherent capacity constraints limiting the number of director appointments per team member.   We take our role as directors, governance committee members and trustees seriously, thus providing exceptional corporate governance of the highest standard.

  • IMS can also provide the following services to fund entities if required:  registered office and company secretary, trustee of management/voting shares and introductions to approved auditors and attorneys.

Licensed to provide independent directors

 

All members of IMS’ staff that act as fund directors are registered with the Cayman Islands Monetary Authority as ‘Professional Directors’ pursuant to the Directors Registration and Licensing Act of the Cayman Islands.

Why Choose Cayman as a Fund Domicile?

 

Having spoken with many investors over the years, we have ascertained that there are various factors which make Cayman attractive as a domicile for hedge funds:

  • Fast to Market – The speed of bringing a new fund to market is excellent, with the ability to set up a new fund in a few days (subject to fund documentation first being agreed).  Local service providers have developed a fast and efficient service, backed up by tried and tested fund documents, which can easily be tailored to an investment manager’s needs.

  • Regulation – The Cayman regulatory regime is very well balanced and works well from an investor’s perspective.

  • Cost effective jurisdiction.

  • Laws – Straightforward and easy to understand fund laws and some of the best legal talents in the world.

  • Service Providers – One-stop-shop jurisdiction, where all required service providers are available on-island.

  • Political stability and tax neutrality.

To find out more about our fund services, and how IMS can assist you, please email us at contactus@ims.ky.

AML Officers for Cayman Funds

The Requirement

Following recent amendments to the Cayman Islands Anti-Money Laundering Regulations 2017 and Guidance Notes issued by CIMA pursuant thereto, there is now a requirement for all Cayman domiciled entities carrying out ‘relevant financial business’ (which includes funds) to appoint individual named persons as AML Compliance Officer (“CO”), Money Laundering Reporting Officer (“MLRO”) and Deputy MLRO (“DMLRO”).

A person acting as MLRO / DMLRO must (i) act autonomously; (ii) be independent (have no vested interest in the underlying activity); and (iii) have access to all relevant material in order to make an assessment as to whether an activity is or is not suspicious.

Entities that are in-scope and therefore subject to the above requirement are:

  • Regulated Investment Funds registered with CIMA;

  • Any other entity carrying out ‘relevant financial business’.

The same person can be appointed as CO and either MLRO or DMLRO, but the MLRO and the DMLRO must be two separate individuals.

Entities must therefore address these requirements as soon as practicable in order to comply with the requirement to appoint their CO, MLRO and DMLRO.

 
mlro-dmlro-aml-services-cayman-islands.jpeg

Our Solution

IMS can provide AML Officers to act for funds for which we currently provide independent directors.

One of the many benefits of our solution over other potential service providers is that our AML Officers will have face to face access to the director(s) we provide and access to fund documentation to which our directors obtain and review from all service providers to the funds we work with, giving them invaluable knowledge of the fund(s) operations and structures. CIMA has confirmed that a fund director may also act as CO and MLRO and/or DMLRO if they are fit and proper to conduct that role and are suitably qualified and experienced.

We are able to offer a tailored number of appointments (see below) to suit your requirements, and can arrange relevant documentation to effect the appointments.

Combinations of appointments offered
  • CO, MLRO and DMLRO

  • CO & MLRO

  • CO & DMLRO

  • MLRO and DMLRO

Our pricing is dependent upon the specific appointments required and will reflect economies of scale where there are, for example, master feeder structures etc. We will provide a fee quote on request.

For more information on AML Officers please contact:

Ebony Myles Berry_edited (2).png

EBONY MYLES-BERRY

Fund Fiduciary

Tel: +1 (345) 526 5809

Email: emyles-berry@ims.ky

Our Philosophy

  • We were the first to provide independent professional directors to funds in the Cayman Islands and pride ourselves on being one of the premier firms in the space.  Many other providers of director services have modelled themselves on us.

  • We believe in transparency and integrity – our ultimate goal is to ensure that the funds we provide services to benefit from corporate governance of the highest standard.

  • We believe that the directors of a fund (and indeed our own board of directors) should have relevant experience and expertise, capacity and independence.  They should also be accessible to all stakeholders in the funds we serve, including investors, and that our directors’ fiduciary duties are owed to the fund as a whole and that they must therefore act at all times in the best interests of the fund.

  • Our total independence from investment managers, administrators, lawyers and other service providers ensures that we are not conflicted when considering difficult issues facing a fund.

  • We welcome visits from potential clients, fund service providers and existing or prospective investors in funds we provide directors to and are happy to talk through our model of directorship services, the role of the directors we provide and the numbers of client relationships our fund directors have.

  • Our internal procedures and guidance for fund directors ensure that investors in the funds we provide directors to can be confident that the interests of the fund (and therefore the investor base as a whole) are best served.

To find out more about our fund services, and how IMS can assist you, please email us at contactus@ims.ky.

 

Role of Independent Non-Executive Director

The directors we provide are well aware of their fiduciary duties to the companies for which they act as directors. At their most basic, they must:

1.  Act bona fide in what they consider to be the best interests of the company;

2.  Exercise their powers for the purposes for which they are conferred;

3.  Not place themselves in a position where there is a conflict between their personal interests and their duty to the company; and

4.  Exercise reasonable care, skill and diligence that would be expected of a reasonably diligent person having the general knowledge, skill and experience reasonably to be expected of a person acting as an independent non-executive director (which is based upon the knowledge, skill and experience which the director actually possesses).

For more information on funds generally contact us:

Gary Butler photo_edited (1).png

GARY BUTLER

Managing Director

Tel: +1 (345) 949 4244

Email: gbutler@ims.ky

 

Fund Director FAQs

Why use professional independent directors?


The directors of a fund are collectively responsible for promoting the success of the fund by leading and directing the fund’s affairs. Effective corporate governance is imperative in today’s environment as regulators continue to increase their scrutiny and investors are increasingly demanding it. Additionally, other key considerations include potential favorable impact on the tax planning of the investment manager and securing the offshore tax status of the fund through the management and control being exercised in an offshore jurisdiction.




What is the role of an independent director (and what value will they add)?


As long as the fund is investing in accordance with the investment strategies and restrictions disclosed in its offering document, the role of an independent director is generally limited to a high-level supervisory role reviewing the performance of the fund and its service providers (including the investment manager), reviewing and executing agreements, attending directors meetings and dealing with any extraordinary issues such as side letters and resolving conflicts. Independent directors add value by being free of any relationships with the investment manager, administrators and other service providers; their representation on boards is seen positively by investors and regulatory and tax authorities; they increase both investor and service provider confidence; and they possess knowledge and experience of the jurisdictional requirements where the fund is established.




What should I consider when selecting an independent director?


A. Independence, capacity constraints, insurance coverage, regulatory approval, corporate support, qualifications, and experience are some of the key factors to consider when selecting an independent director. Directors are individuals who come with different backgrounds, styles, interpersonal skills, and many of the other aforementioned attributes. The objective is to find a competent individual with a commercial mindset who will be responsive to the affairs of the fund.




Why is independence important?


A. Independence is critical to effective corporate governance. If a director is not independent, conflicts of interest will inevitably arise and interfere with the director’s ability to act in the best interests of the fund. Ensuring that the prospective director is independent of the investment manager, administrator and other service providers is critical.




What is meant by capacity constraints?


A. The directors oversee the affairs of the fund and time and effort is required to effectively fulfill their duties. If they sit on an excessive number of boards or have too many manager relationships they will be unable to adequately serve the fund.




What about insurance coverage?


A. Given today’s increasingly litigious environment insurance coverage is becoming ever more important. A sufficient level of insurance coverage will provide an indication of the financial standing of the individual and organization. It will also give some assurance that they have an understanding of the litigation risks in today’s environment.




How much will an independent director charge?


A. The directors are responsible for the oversight of the fund’s affairs. As such, they have personal liability and the penalties associated with a failure in fulfilling their duties will far exceed the fees they will receive. The remuneration of a director should be sufficient to attract and fairly compensate high quality individuals.





Cayman Fund Law

  • As an independent service provider, we enjoy good relationships with all of the major law firms both in the Cayman Islands and on-shore.

  • The Cayman Islands benefits from a form of regulation which benefits both investors and fund managers alike, with the result that funds are easy to establish and easy to maintain in the Islands.

  • The laws governing Cayman domiciled investment funds are the Mutual Funds Act 2020 (as revised from time to time) (the “Mutual Funds Act”) and the Private Funds Act, 2020 (“Private Funds Act”).

  • All open-ended funds are covered by the Mutual Funds Act and regulated by the Cayman Islands Monetary Authority (“CIMA”), including those formerly exempted funds where the equity interests are held by not more than 15 investors and the majority of those investors have the power to appoint or remove the fund’s operators.  In February 2020, the Cayman Islands enacted the Private Funds Act, which introduced a new regulatory regime for closed-ended Cayman Islands funds (“private funds”) which are now also required to register with CIMA and are subject to regulation. Since the passing of the Private Funds Act, over 13,000 private funds registered with CIMA.

The three types of regulated funds under the Mutual Funds Act are Licensed Funds, Administered Funds and Registered Funds.

1.  Registered Funds – Require that either (a) the minimum subscription per investor must be at least U.S.$100,000 (or its equivalent in any other currency),  or (b) its equity interests be listed on a stock exchange approved by CIMA.  These are by far the most utilized and straightforward form of regulated fund.

 

2. Administered Funds – A mutual fund having more than fifteen investors and not  being a licensed or registered mutual fund will be an administered mutual fund (an “Administered Fund”) if its principal office in the Cayman Islands is provided by a mutual fund administrator licensed in the Islands.  The licensed administrator has a duty to satisfy itself of matters similar to the matters CIMA requires in relation to licensed funds (see below) and file a declaration with CIMA confirming that it is so satisfied.

                                              

3.  Licensed Funds – Unless a mutual fund is an administered, registered or is subject to an exemption, it must not carry on business in or from the Cayman Islands unless it has a mutual fund license and has either a registered office in the Cayman Islands or, in the case of a unit trust, has a trustee which is a local licensed trust company.  In order for a fund to obtain a license, CIMA must be satisfied that each promoter and the administrator of the fund is of sound reputation and have sufficient expertise and that the fund’s business and any offer of equity interests will be carried out in a proper way.  CIMA will require such information and documentation in its discretion to so satisfy itself.

  • There are various continuing obligations in relation to regulated funds, which include the requirement to submit a fund annual return (FAR), file current offering documents and prescribed particulars with CIMA, file accounts audited by an auditor approved by CIMA within 6 months of each financial year end.  Precise details are beyond the scope of this page – we recommend that legal advice is taken in this regard.

  • The latest revision of the Mutual Funds Act can be found on the Cayman Islands Monetary Authority Website, which can be accessed by clicking here.

To find out more about our fund services, and how IMS can assist you, please email us at contactus@ims.ky.