Feature report

caribbean report cayman islands

View from the top

Richard Coles, of Cayman Finance, shows how the Cayman Islands are staying on top as a financial centre

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f ever one reads an attack on the Cayman Islands it can usually be guaranteed to come from one of three sources:

1) Hollywood. Thank you Tom Cruise, do not come back any time soon. 2) Much larger countries whose economy comes under the heading of basket case. Yes, USA and UK, Im thinking of you. 3) Ultra Left bloggers who want to see a uniform (and very high) rate of tax levied throughout the world. We in the Cayman Islands financial community have learned to live with these barbs, and are content to stand by our track record of fiscal probity and efficiency. Our current regulations recognise that Cayman vehicles trading in onshore jurisdictions are subject to the laws and regulation of those jurisdictions. Indeed, the Cayman Islands government announced in September that we are now in compliance with all nine essential elements of international tax transparency and information standards as set by the OECDs Global Forum.

Another jurisdiction, Ireland, also tried to claim that there was an exodus of hedge funds from Cayman to the Emerald Isle. They were quickly disabused of this canard when it was pointed out that the Cayman fund industry was growing to the tune of 95 new funds per month. According to The Cayman Islands Monetary Authority (CIMA), the total number of regulated funds stands at 9,409. This June 2011 figure comprises 8,857 registered funds, 424 administered funds and 128 licensed funds. One commentator noted: For the institutional investors and managers, the well understood path of the Cayman fund non bureaucratic, quick

RichaRd coles

chairman, Cayman Finance ures jumped by 1.15% in the first six months of 2011 from 91,206 to 92,251. As of June 2011, 16 Class A banks and 231 Class B banks were licensed by CIMA. Class A insurers stand at 29 and of captive insurers there is a total of 725.

Staying on top
Is everything in the garden rosy? Of course not. We in the financial community must tackle a few niggling problems. We need to provide 25year security of tenure for financial professionals wishing to establish operations in Cayman. The signs are good on this front, thanks to the vision of Premier McKeeva Bush. We must continue to combat misinformation generated by high-tax advocates concerning tax evasion and money laundering. We must resist European bureaucrats who are pushing for us to adopt direct taxation. I dont think we need lectures from them how to run an economy. Lastly, we ensure that our regulations continue to interface with the onshore entities with whom we deal with on a daily basis. Incidentally, the weathers great, the beaches are world class and we speak English. What more do you want?

we are now in compliance with all nine essential elements of international tax transparency and information standards
- Richard Coles
set-up times, high-quality service providers and its solid reputation - is preferred. It has also not escaped the notice of canny global investors that Cayman is well placed in terms of the EU AIFM Directive and is compliant in the relevant issues. Add all of this to the hated 50% tax rate in the UK and Capital Gains Tax at 28% and it is hardly any surprise that more and more UK business people are looking to the Cayman Islands with a view to incorporating here. Its not all about hedge funds on Cayman. Company registration fig-

Top financial centre

None of this comes as any surprise to those of us who work in Cayman. Indeed, last year the leading financial magazine The Banker named the Cayman Islands as the top specialised financial centre for the second year running. By an increased margin, this placed us above jurisdictions such as Bermuda, Jersey, Guernsey, Malta, Gibraltar, Monaco and Cyprus.

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