Cayman Islands Alternative Investment Fund Structuring And Regulatory Considerations

This article considers the range of vehicles available in the Cayman Islands for alternative investment fund ("AIF") structures designed for financial institutions, pension funds, sovereign wealth funds, family offices and (U)HNWs (as opposed to retail investors), as well as the legal and regulatory considerations that may influence the structure of an AIF.  A summary of the key similarities and differences between the regulation of closed-ended and open-ended AIFs in the Cayman Islands is also considered.

Cayman Islands AIF Vehicles

There are five types of vehicles that are commonly used in the Cayman Islands for AIF structures:  exempted companies, segregated portfolio companies ("SPC"), exempted limited partnerships, trusts and limited liability companies ("LLC").  The appropriate vehicle, or combination of vehicles, for an AIF structure will be driven by a number of considerations, including the target investor base and strategy, as well as the ability to