Appointing a registered agent for a Cayman Islands company is a needed step and it can be provided by a firm that offers these types of services.
It is often common for our Cayman Islands incorporation specialists to also provide registered agents services. Below, we talk about the general requirements when opening an offshore company, why it is mandatory and important to have a registered agent and the main role of this appointed representative.
Opening a Cayman Islands exempted company is an easy and straightforward process as long as the foreign business owners comply with the ongoing regulations, such as having a representative and maintaining a registered office.
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What is the role of the registered agent in the Cayman Islands?
The registered agent is a third party involved in the management if the business that is located in the Cayman Islands. This particularity, that the agent is located in the same jurisdiction as the offshore company, is a key element for the function of the agent as well as the reason behind its appointment.
Every Cayman Islands exempted company is required to have a registered office and a registered agent physically located in the Islands. The agent services can be provided by an individual or by a company (more common). The duties of the agent are related to handling the basic management of the company as well as being listed as the contact person for the Cayman Islands authorities.
The name and the contact details for the registered agent are public, unlike the identification details for the company directors and shareholders (in the Cayman Islands there is no need to keep a public list of the company members).
The role of a registered agent is an important one and having a representative able to handle the main corporate and management issues for the company in the absence of the beneficial owners/s is essential. Our Cayman Islands company formation agents list some examples of the duties of a registered agent below:
- Communications: for example, the agent will handle all of the needed communications with the Cayman Islands General Registry;
- Submissions: he will submit the annual returns (important so as not to risk being struck off the register);
- Notifications: he will notify the Registry of any changes to its Articles of Association and Memorandum (which can be freely altered as long as the changes are notified);
- Others: the registered agent will also maintain the minutes of the meetings and shareholder resolutions unless indicated otherwise by the company directors.
In summary, the role of the registered agent in the Cayman Islands is to act as an intermediary between the Government, the General Registry and the offshore company as well as an intermediary between the company and any other third parties. This public involvement with the company and the fact that the registered agent is expected to act accordingly to solve any managerial issues is the main reason why a specialized firm is often appointed for this purpose. When working with a team of agents, like our Cayman Islands incorporation specialists, handling the needed administration and management tasks becomes easier as they do not fall onto a single individual who is appointed as a representative. A company with experience that has provided this type of service to numerous international clients has the qualification and the recognition to provide registered agent services.
How is the registered agent appointed?
While there is no mandatory appointment procedure stipulated in the Companies Law, the representative agent can work with the company founders as early as the preparation of the Articles of Association. He can be the one who submits the Articles and the rest of the documents for registration and will, therefore, become the contact person for the company from the very beginning.
The registered agent will receive both sensitive information (and time-sensitive documents) such as legal notices or litigation notifications and will also handle daily managerial processes and standard notification as well as submissions. Because of the nature of the work, working with a professional registered agent is important to ensure the proper and legal functioning of the Cayman Islands exempted company.
Can the registered agent be changed?
Changing the registered agent is possible and it can be performed by means of a resolution and an amendment of the company details. It should be noted that when working with a firm that offers these types of services, the offshore company will also be subject to a due diligence process.
In order to commence the change of the registered agent, the company directors or beneficial owners will need to send a written request to the registered agent in force, asking for the resignation. The former agent will also be required to pass on the administration of the Cayman Islands exempted company (or another business form) onto the new registered agent.
In most cases, the change of the registered agent is a straightforward process, however, it is advisable to seek proper advice especially if the company is experiencing certain administrative issues and the change of the agent would be problematic (or the alternative new agent would refuse it).
Cayman Islands company formation
Investors who are interested in opening a company in the Cayman Islands have several options for business creation. The available business forms are designed to meet the needs of investors and the exempt company is the one that meets the needs of those entrepreneurs who are interested in basing the activities of the company outside of the jurisdiction.
The types of companies available for Cayman Islands incorporation are the following:
- Exempt company: the activities of this company will mainly take place outside of the Islands; it can issue nominal or no par value shares, it is not required to keep a public member’s list and it annual general meetings can take place in any location, they do not need to be scheduled in the Islands;
- Limited liability company: it too can engage in activities mainly outside of the jurisdiction; it required no capital and the management falls onto the members;
- Resident company: it engages in business in the Cayman Islands and are subject to annual reporting requirements; these companies can be used to hold land in the islands;
- Non-resident company: this is a company that received the status of non-resident through an application with the Ministry of Finance; it must state that it will not intend to carry out business in the Cayman Islands.
Other types of business forms are the foundation, the not for profit association as well as the overseas company. Investors interested in more information on these types of companies as well as those who need assistance in setting up a Cayman Islands company can reach out to our agents.
Registering a company in the Cayman Islands is advantageous for investors and the requirement to appoint a registered agent is not a burdensome one. Chief among the benefits is the tax neutrality of the jurisdiction, meaning that there is no corporate income tax, no payroll, capital gains taxes, and no withholding taxes on any business form, whether foreign or domestic. In addition to this, the actual incorporation process is a straightforward one and the company can be formed in a matter of days when all of the documentation requirements are met. The role of a professional registered agent is important in this case as once appointed, the agent can oversee the execution of the incorporation steps, as needed. Investors who are looking for a ready-made company also have this option and they can choose between various shelf companies. In this situation, the appointment of the registered agent may already have taken place, according to the type of company and its incorporation date, however, as described by our agents, the agent can be changed.
Companies in the Cayman Islands follow several privacy standards and although the authorities collaborate with relevant bodies and enforcement agencies (including overseas ones), the protection of the legitimate interests of the company founders is in place.
Company statistics in the Cayman Islands
According to the Cayman Islands General Registry, 807 companies were registered in April 2020. In 2019 there were 12,763 companies included in the Registry and in other years, the number varied as follows:
- in 2018 there was an increase in the number of registered companies compared to the previous years, with 16,326 new companies added to the register;
- in 2017 the number of new registrations was of 13,046 and in 2016 there were 11,174 companies added to the Register;
- according to their type, the majority of active companies in the Cayman Islands are exempt ones, followed by resident companies; the advantages of the Cayman Islands exempted company are numerous, as seen above, and it is natural for this business form to be popular in the jurisdiction.
Choosing the registered agent service provider is an important step for setting up a Cayman Islands company. Investors can contact us for more information about registered agent services and the importance of having a professional firm to provide these representative services.