By Kirsten Hastings From International Adviser

The Cayman Islands is to introduce a new type of business vehicle in the form of a limited liability company (LLC), inspired by similar legislation in the US state of Delaware.

The Limited Liability Company Bill (2015), first introduced in December 2015, passed uncontested through the Cayman Islands’ Legislative Assembly on Wednesday.

Speaking to the Assembly, financial services minister Wayne Panton said: “The primary driver for this bill has been industry demand. The introduction of an LLC by the Cayman Islands has been highly anticipated by our local industry but also crucially by our international service providers.”
Hybrid vehicle

The LLC is a hybrid vehicle, combining some of the characteristics of a Cayman Islands exempted limited partnership with those of a Cayman Islands exempted company.

It will be a body corporate with separate legal personality, similar to an exempted company but without the constraint of having share capital. Its members will also enjoy limited liability.

A Cayman LLC is required to maintain registers of members, managers, and mortgages and charges. However, similar to Cayman Islands exempted companies, only the register of managers will be filed with the islands’ Registry.

“This hybrid approach will be useful in a variety of investment spaces, such as investment funds, joint ventures, and holding vehicles for a variety of assets,” Panton said.

Exempt avoided

Panton said the word ‘exempt’ had been intentionally excluded to “avoid undue criticisms from certain groups in the international community who have an anti-Cayman or anti-[International Finance Cooperation] agenda, who view reference to the word ‘exempted’ with suspicion and depict it as a term which indicates that it is a vehicle which is permitted to operate wholly outside the bounds of law and regulation”.

For more on this story go to: http://www.international-adviser.com/news/1028924/cayman-islands-mimicking-delaware-limited-liability-company#sthash.DI53I8LL.dpuf