From Cayman Funds Magazine

With the transitional period for the implementation of the European Alternative Investment Fund Managers Directive (AIFMD) having recently expired, the Cayman Islands is well placed to navigate the new regulatory landscape in Europe.

That is according to a note by Maples and Calder in relation to the first transitional period for the new regime, which governs the management and marketing of alternative investment funds in the EU, expiring on July 22, 2014.

From this date, Cayman Islands funds can now only be marketed in the member states of the EU in compliance with the requirements of AIFMD, unless a relevant exemption applies.

“The Cayman Islands is the jurisdiction of choice for offshore alternative investment funds, and has taken steps over the last few years to ensure that it is well placed to navigate the new regulatory landscape in Europe following the implementation of the AIFMD.

“What this means in practical terms is that managers of Cayman funds will be able to continue marketing their funds in the EU member states under the NPPRs until at least 2018,” the note said.

Different marketing regimes will apply from the end of the transitional period to 2018 and beyond.

Between the end of the transitional period and 2015, only EU managers of EU funds will be able to apply for a passport to market their EU Funds to professional investors on a cross border basis throughout the EU. However, managers of funds established in jurisdictions outside the EU will be able to continue marketing in EU member states subject to each member state’s national private placement regimes (NPPRs) provided that certain minimum requirements of the AIFMD are satisfied.

One of these requirements is that the country is not blacklisted by a Financial Action Task Force as a Non-Cooperative Country and Territory. Another is that co-operation arrangements must be in place between local regulators and the country in question.

The Cayman Islands is not on the FATF blacklist and to date the Cayman Islands Monetary Authority (CIMA) has signed Memoranda of Understanding with 27 of its counterparts in EU member states. As such, Cayman funds satisfy the minimum requirements prescribed by the AIFMD in order for these to be marketed in the EU member states subject to each member state’s NPPRs.

Managers of Cayman funds wishing to market their funds using the NPPRs will need to comply with certain provisions of AIFMD. These differ depending on whether the manager is established in the EU or in another country.

Between 2015 and 2018, the European Securities and Markets Authority (ESMA) must give an opinion as to whether the passport regime should be extended to these other countries. If the passport regime is extended, in this period, managers of Cayman funds will be able to choose whether to continue to market under the NPPRs or apply for a passport.

AIFMD, Cayman, Maples and Calder

For more on this story go to: http://www.caymanfundsmagazine.com/news/cayman-islands-well-placed-as-aifmd-transitional-period-expires-225

 

Related story:

Cayman banks are working to establish a FATCA solution

By Raymond Grove From Convey

The Cayman government has issued local FATCA legislation and forms, and banks are reporting that they are ready to comply with the law. Banks in the Cayman Islands are preparing their compliance solution for the Foreign Account Tax Compliance Act (FATCA), according to the head of Cayman finance, Gonzalo Jalles. He said that he’s heard that many financial institutions in the country are on track in regard to FATCA compliance, Cayman 27 reported. Thus far, there haven’t been too many complications and reports say people are doing well.

Jalles noted that when the first round of registration for foreign financial institutions (FFIs) was open, 20 percent of the organizations that submitted their documentation were Cayman, indicating that the country’s banks were taking early strides toward adhering to FATCA regulations.

Currently, the Cayman Islands have solutions for the account onboarding and indicia checking pieces of FATCA. However, they are still working on the reporting rules. According to Lexology, the Cayman government issued regulations to go with the Tax Information Authority Law (2013 Revision) on July 4. This legislation allows for the enactment of provisions of the Model 1B intergovernmental agreements (IGA) between the country and the U.S. as well as the U.K. The regulations took effect July 1, and the government also issued template FATCA self-certification forms.

“The regulations have just been issued, so everything seems to point that we are on the right track,” Jalles said.

For more on this story go to: http://www.convey.com/1099-news-tax-blog/international-tax-compliance/cayman-banks-are-working-to-establish-a-fatca-solution/#ixzz399C7SL5b

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