Segregated Portfolio Companies

INTRODUCTION

A significant amendment was made to the Companies Law (the "Law") which extended the scope of the Segregated Portfolio Companies provisions in Part XIV of the Law.

The Law as amended permits any exempted company to apply to the Registrar of Companies to be registered as an exempted segregated portfolio company ("SPC"). These provisions were previously restricted to apply only to certain insurance companies. Exempted companies regulated by the Cayman Islands Monetary Authority ("CIMA") also require the permission of the CIMA to register as an SPC.

Once registered, exempted companies can operate segregated portfolios with the benefit of statutory segregation of assets and liabilities between portfolios. The principal advantage of an SPC over a standard exempted company is to protect the assets of one account from the liabilities of other accounts.