The BVI was one of the first territories to put in place a regime to prevent the use of bearer shares. From 1 January 2005 the use of bearer shares has largely been eradicated in the BVI but issues still arise particularly in circumstances where the holder of bearer shares has died or is incapacitated in some way.
This article provides a general overview of the procedure for the enforcement of foreign arbitral awards in each of the two jurisdictions.
Guy Manning and Hamid Khanbhai discuss the Privy Council’s first consideration of an appraisal action brought under section 238 of the Companies Law of the Cayman Islands. The Board considered a narrow question of how a dissenter’s shares should be valued.
In Pearson v Primeo [2020] UKPC 3, the Privy Council considered an appeal by a liquidator on the scope of section 112(2) of the Companies Law (2018 Revision) of the Cayman Islands. The provision relates to a liquidator’s power “to settle and if necessary rectify the company’s register of members, thereby adjusting the rights of members amongst themselves”. The power arises only in the context of a solvent liquidation of a company which has issued redeemable shares at prices based upon its net asset value.
The Cayman Islands’ liquidation of Saad Investments Company Limited has inched a step closer to finality, with the Grand Court authorising an ‘in-principle’ interim dividend to unsecured creditors despite the fact that the multi-billion dollar proprietary claim asserted by Ahmad Hamad Algosaibi and Brothers Company (“AHAB”) over the entire Saad estate continues to be litigated before the Cayman Courts.
The Economic Substance (Companies and Limited Partnerships) Act, 2018 (the “Act”) was passed on 1 January 2019, introducing economic substance requirements in the British Virgin Islands (“BVI”) for certain BVI legal entities that are not tax “resident” in countries outside the BVI and carry on a “relevant activity” as further specified in the Act. On 22 April 2019, the International Tax Authority (“ITA”) of the BVI issued a draft Economic Substance Code (the “Code”) to provide guidance and interpretation in respect of the Act (for further information please see our earlier client briefing).
The Data Protection Law, 2017 (the “Law”), currently scheduled to come into force on 30 September 2019, introduces, for the first time in the Cayman Islands, a legislative framework for data protection based on a set of internationally recognised privacy principles. The Law regulates the processing of all personal data in the Cayman Islands and will impact all entities established in the Cayman Islands, including all investment funds whether or not registered with the Cayman Islands Monetary Authority. The Law applies irrespective of where personal data is processed and applies to personal data irrespective of individual citizenship or residency.
This note focuses on the specific effect of the Law for investment funds.
The August 2019 judgment of Kawaley J, sitting in the Grand Court of the Cayman Islands (the “Grand Court”), in Riad Tawfiq Al Sadik v Investcorp Bank B.S.C & Ors (FSD 47 of 2009) has provided litigants with judicial guidance of general application concerning interim payments on account of costs. The reasons provided are the most detailed since the introduction of the interim payments jurisdiction into the Grand Court Rules in 2016, concluding that the Rules contain “an implicit starting assumption that an interim payment should be made”. This is in stark contrast to the approach taken prior to the introduction of the rule, when the inherent jurisdiction to order interim payments was exercised only in “rare and exceptional circumstances”.
On 29 July 2019, the Judicial Committee of the Privy Council handed down its judgment in Skandinaviska Enskilda Banken AB v Conway & Shakespeare (as joint official liquidators of Weavering Macro Fixed Income Fund Ltd) (Cayman Islands) [2019] UKPC 36. The Privy Council upheld the decisions of the Cayman Islands Grand Court and Court of Appeal in finding that certain redemption payments received by Skandinaviska Enskilda Banken AB (Publ) (“SEB”) from Weavering Macro Fixed Income Fund Ltd (the “Company”) shortly prior to the Company’s liquidation constituted voidable preferences and requiring SEB to repay those amounts to the Company’s joint official liquidators (“JOLs”).
On 19 March 2019, the Caribbean Financial Action Task Force (“CFATF”) issued its latest assessment of the Cayman Islands’ AML/CTF/CFP regime (the “March Report”). The assessment evaluated technical compliance (i.e. having legislation in place) but also, for the first time for the Cayman Islands, evaluated the effectiveness of Cayman Islands legislation.