The Cayman Islands is the leading domicile for investment funds, attracting 80% of all new offshore fund formations. Cayman is estimated to house more than 75% of the world’s offshore hedge funds and nearly half of the industry’s estimated US$1.1 trillion of assets under management. Not only does it provide a stable, tax-neutral platform but also offers a sound legislative and judicial system, confidentiality, a leading banking sector and legal and financial professional and support services. The attraction of the Cayman Islands for offshore funds has been enhanced by the establishment of the Cayman Islands Stock Exchange (the “CSX”) which has enabled funds to obtain listing status where required.
LINDEMANNLAW can help you structure private funds and mutual funds, including alternative investment vehicles, restricted scope private funds, exempted limited partnerships, master fund structures, co-investment vehicles, vehicles set up to hold only a single investment, limited liability companies and trusts, registered funds, limited investor fund, administered fund, licensed fund, open-ended hedge funds.
In addition, the Cayman Islands is a major participant in the global securitisation market. The Cayman Islands provides a tax neutral hub in a jurisdiction, which is compliant with global regulatory standards. The Cayman Islands possesses a well-developed legal system for securitisation transactions, which is creditor-friendly and recognised by rating agencies. It has company, trust, partnership and related laws that allow a high degree of flexibility for establishing special purpose vehicles.
Securitisation is, in its very basic terms, the process of taking a illiquid assets (e.g. private debt, real estate, CAT risks) through financial engineering transforming them into a bankable security with an ISIN which may be easily sold to and subscribed by investors on financial markets. The process is particularly attractive to regulated or non-regulated institutions or asset managers such as banks, insurers, real estate developers or other alternative investments providers which may be subject to regulatory limits on levels of lending by reference to the outstanding level of loan assets held on their balance sheets.
LINDEMANNLAW can help you structure securitization transactions, including set up of special purpose vehicles (SPVs), e.g. exempted company, limited liability company, exempted limited partnership, trust company, charitable and purpose trust company, structured finance vehicles, debt issues and debt issuing vehicles, preferred equity financing vehicles including drafting of financial instruments and negotiation with financial regulators (e.g. CIMA) and paying agent(s) and tokenization (security or asset tokens – STOs).