There are several types of companies in the Cayman Islands that can be broken down into two main categories. In general, some types of companies are incorporated to trade in the Cayman Islands while other are formed for the purpose of conducting business outside the Islands. for example, according to the Companies Law, exempted companies are prohibited from trading in the Islands although they have the right to conclude contracts here and exercise the necessary powers, as needed.
Our Cayman Islands incorporation specialists can help you with detailed information about each company type and the specific requirements for registration.
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The main types of Cayman Islands companies
The following list contains the main types of companies that can be incorporated in the Cayman Islands:
- Ordinary Company: this is also referred to as the resident company, it can be incorporated by at least one shareholder and one director.
- Ordinary Non-Resident Company: it is essentially the same as the ordinary company, only that a special certificate is issued to confirm that it will not carry business in the Islands.
- Cayman Islands Exempt Company: it has the same characteristics as the ordinary company and some of the restrictions on doing business in the Islands as the non-resident company but does benefit from lighter management requirements.
- The Limited Duration Company: it shares many similarities with the LLC and allows investors to only be liable up to the amount invested; certain exemption can apply to this business form.
- The Foreign Company: a company that is incorporated in another jurisdiction and opens a place of business to carry out activities in the Cayman Islands.
Opening a bank account is a reuqirement after deciding on a suitable business form.
Differences between the types of companies in the Cayman Islands
Our Cayman Islands company formation agents talk about three of these business form in more detail below.
The Ordinary Company is the Cayman Islands resident company and a legal entity that may carry our business in this location. They must have a registered office in the Cayman Islands and have certain annual reporting requirements, as deemed necessary by the registrar of Companies. this company will observe the provisions of the Companies Law and will need to obtain special licenses for some types of business activities, such as banking.
The Ordinary Non-Resident Company is a business form that resembles the ordinary company in some respects but cannot perform the same business activities. For example, a non-resident company cannot perform business activities in the Islands and it must obtain a special certificate that clearly states this. It can be used to hold shared of foreign companies. If needed, this business type can be converted.
Cayman Islands Exempt Company: it has the same incorporation requirements as an ordinary company but may not conduct business in the Islands except those related to the promotion of its activities abroad. This type of company does not have to comply with the annual return requirements needed for the other two types. It does not have to include the abbreviation for a limited company after its chosen name and can express its capital in more than one currency. Another form of the exempt company is the exempted limited duration company. As the name suggests, the Memorandum of the company stipulates the duration of the company – which must not exceed thirty years. Another condition for this business form is to have at least two members.
Outsourcing the accounting services is reccomended for these companies.
Other two types available for those interested in setting up a Cayman Islands company are the segregated portfolio companies and the foreign company, established outside the Islands that can open a place of business to conduct certain activities. The segregated portfolio company is a type of exempted company that allows for the segregation of both assets and liabilities in individual portfolios. The Cayman Islands General Registry also allows for the re-registration of current exempt companies and non-resident companies as special economic zones companies.
If you need details about the laws for foreign investments in the Islands, our lawyers can give you more details.
Our team of Cayman Islands incorporation agents can give you further information not only on the types of companies but also on the provisions of the Companies Law. You can discuss with us issues like the incorporation and post-incorporation steps, the management and administration of companies, the taxation, continuance of companies and the termination of the various business structures.
Contact us for more information about Cayman Islands company formation and more in-depth information about each legal entity type. We can also help you with company formation in other countries, such as Georgia, through our local partners.