CAYMAN PRIVATE FUNDS LAW 2020

- June 3, 2020

WHAT INVESTMENT MANAGERS
NEED TO DO AND HOW DMS BANK CAN HELP

INTRODUCTION

To date, Private Funds have been exempt from registration with the Cayman Islands Monetary Authority (CIMA). The Private Funds Law 2020 (“PF Law”) that commenced on 7 February 2020, creates a regulatory regime for closed-end funds, such as Private Equity / VC / Private Debt funds etc. Many of the requirements under the PF Law are similar to the existing requirements for open-ended funds, but there are some additional operational features contained in the PF Law which Managers also need to address.

All Private funds, whether formed before or after the passage of the PF Law, must register with CIMA by 7 August 2020.
This document contains a brief overview of the requirements contained in the PF Law and information on how DMS Bank can assist. For a more in-depth view of the PF Law, please refer to the briefing contained in the following link.

WHAT IS A PRIVATE FUND?

A Private Fund is an investor pooling vehicle without a right to redeem, which includes typical private equity and venture capital funds. The definition of investor should be carefully reviewed as it excludes parties closely associated with the establishment and management of the fund.

WHAT ARE THE FUND OPERATIONAL REQUIREMENTS AND WHAT CAN DMS BANK HELP WITH?

DMS bank and trust can ensure clients fully adhere to these new fund operational requirements.

Please do not hesitate to reach out to a member of the DMS Bank team to discuss any Regulatory Advisory, Registration, Banking & Governance services that can assist you in complying with these new requirements.

KEY DATES FOR FUNDS

7 August 2020 – All Private Funds, whether formed before or after the passage of the PF Law, must register with CIMA by this date.
30 June 2021 – All Private Funds must file financial statements audited by a CIMA approved auditor by this date.

KEY PRIMARY SOURCES

PRIVATE FUNDS LAW 2020
CIMA NOTICE RE: PRIVATE FUNDS LAW, 2020 (“PFL”) – Frequently Asked Questions
WHERE CAN I FIND A MORE DETAILED ANALYSIS?