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10/26/2017 |
Business |
Cayman Islands Enact Foundation Companies Law |
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The Cayman Islands have introduced a new type of corporate vehicle: Foundation Companies. The Foundation Companies Law, 2017 (the Law) came into force on 19 October and was drafted to allow the FC to be rooted in Cayman Islands company law, but function like a civil law foundation. The Law only applies to companies that have been declared by the Registrar of Companies to be an FC. An FC may be established for any lawful purpose, be it commercial, charitable/philanthropic or private purposes, or any combination of them. An FC shares many of its features with other types of Cayman Islands companies and fits seamlessly into the Cayman Islands’ legal regime. The FC will therefore have the benefit, where relevant, of a considerable body of case law on companies. It is anticipated that FCs will have a wide range of uses, such as special purpose vehicles in finance transactions, as charities, protectors or enforcers (in relation to other trusts or fiduciary structures), as mechanisms within private trust company structures, as succession planning vehicles, and for any purpose for which a trust is currently used. For more information about nature, uses and process to establish a foundation company, please read this full legal update.
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