ARTICLE · 25 JANUARY 2007

Cayman Islands Investment Funds

Charles Adams, Ritchie & Duckworth

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This article summarises the methods of establishing investment funds in the Cayman Islands and highlights the principal legal and regulatory considerations. It is not intended to deal exhaustively with all aspects of the subject and proper legal advice should be obtained before proceeding with the establishment of a particular fund.

Cayman IslandsWealth Management

Introduction

This article summarises the methods of establishing investment funds in the Cayman Islands and highlights the principal legal and regulatory considerations. It is not intended to deal exhaustively with all aspects of the subject and proper legal advice should be obtained before proceeding with the establishment of a particular fund.

The Cayman Islands, with over 6,500 regulated and many more unregulated funds currently in existence, have become a jurisdiction of choice for the establishment of hedge and other investment funds. The laws of the Cayman Islands allow a high degree of flexibility and permit mutual funds to be structured as companies, unit trusts or limited partnerships. Funds may be established for all categories of investor but the Cayman Islands are particularly well suited for private placement funds intended for institutional or sophisticated high net worth investors because:

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