Outsourcing By Cayman Islands Regulated Entities

The Cayman Islands Monetary Authority ("CIMA") has issued comprehensive guidance on the outsourcing of material functions and regulatory requirements by regulated entities (the "Guidance").  This requires regulated entities that fall within the Guidance's scope to review (and potentially revise) existing outsourcing arrangements and, where functions are to be outsourced, to put in place certain internal procedures.  Notably, CIMA may, on a case-by-case basis, impose additional requirements on a regulated entity where an outsourcing arrangement has a potential negative impact on the entity or its customers. The Guidance reflects good business practice and it is expected that regulated entities' existing policies and procedures should, on the whole, be reflective of the Guidance.