Anti-Corruption Act (2019 Revision)
The Anti-Corruption (Amendment) Act, 2022 came into effect on January 30, 2023, amending the Anti-Corruption Act (2019 Revision).
The most significant changes are those that:
designate the Anti-Corruption Commission as the Cayman Islands' law enforcement agency.
provide investigating officers with new authority, and
specify the conditions under which the Anti-Corruption Commission must investigate reports.
The following updated financial services legislation was gazetted in January of this year, for additional details, click on the links below.
Beneficial Ownership (Limited Liability Companies) Regulations (2023 Revision)
Criminal Justice (International Cooperation) Act (2023 Revision)
Anti-Money Laundering Regulations (12 Jan 2023)
On January 12, 2023, a revised version of the Anti-Money Laundering Regulations was published and consolidated all amendments to date including those amendments made between 2020 - 2023.
In addition, the definition of “family member” of a politically exposed person now includes a spouse, civil partner, parent, sibling, or child.
AML Regulations – Proposed Amendments
On January 25, 2023, the government published a consultation proposing to amend the Anti-Money Laundering Regulations. Said amendments included assessing proliferation financing risks and imposing additional AML/CFT obligations on designated non-financial businesses and professions. The initial consultation deadline of February 15, 2023, was extended to March 31, 2023.
On March 31, 2023 CIMA responded to industry consultation on the ensuing suggested measures:
Rules & SOG
Rule and Statement of Guidance on Internal Controls for Regulated Entities
Statement of Guidance on Corporate Governance for Mutual Funds and Private Funds
Certain regulatory measures have been amended to apply to virtual asset service providers (VASPs) and other regulated entities:
Statement of Guidance- Nature, Accessibility, and Retention of Records
These Rules and Statements of Guidance can be found on the CIMA website at: www.CIMA.ky
The Ministry of Financial Services has recommended seven (7) laws to strengthen the Cayman Islands Monetary Authority's (CIMA) authority to impose appropriate and dissuasive sanctions on all categories of legal persons under its supervision.
The Ministry of Financial Services has recommended seven (7) laws to strengthen the Cayman Islands Monetary Authority's (CIMA) authority to impose appropriate and dissuasive sanctions on all categories of legal persons under its supervision. The following bills were released in the Gazette on March 27, 2023:
Directors Registration and Licensing (Amendment) Bill, 2023;
Securities Investment Business(Amendment) Bill, 2023; and the
These bills are designed to enhance the scope of CIMA's sanctions regime to include entities that are subject to its oversight. This includes partnerships, limited liability partnerships (LLPs), exempted liability partnerships (ELPs), and partners in such partnerships as well as those involved in management or control.
In addition, proposed amendments to the Monetary Authority Act (MMA) would allow CIMA to communicate with foreign regulators any non-public information relating to criminal activity.
CIMA: General Industry Notices
Re: - Updated Statement on Silicon Valley Bank - date: 31 March 2023
Following the failure of Silicon Valley Bank (“SVB”) and the appointment of the Federal Deposit Insurance Corporation ("FDIC") as the Receiver, the Cayman Islands Monetary Authority (the "Authority”) continued to engage with the FDIC and other stakeholders regarding the receivership process and impact on SVB’s Cayman Islands branch.
As of today, 31 March 2023, the Authority understands that the FDIC will soon issue notices to SVB Cayman Islands branch customers regarding the next steps of the process. Toll-free numbers for SVB's Call Center are as follows: · 1-800-774-7390or 1-800-215-6677 (in USA) · 1-408-654-5555(outside USA) Please note that their hours of operation are 24 hours a day, 7 days a week. The Authority will continue to engage with the FDIC and all relevant stakeholders to monitor the progress of the receivership process and take appropriate actions where necessary.
Re: - Private Fund SP Fees to be Returned– dated 22 March 2023
The Cayman Islands Monetary Authority (“CIMA”) wishes to advise financial service providers that with immediate effect, it will not be collecting annual registration fees on behalf of Segregated Portfolios for private fund Segregated Portfolio Companies. In addition, CIMA will be seeking to refund any such fees paid from 2020 to date, prior to this notice. CIMA is currently in discussion with the Ministry of Financial Services and Commerce, and it is anticipated that the Private Funds Act and the associated Regulations will be amended, following broader stakeholder consultation. A statutory-based registration fee will be implemented thereafter.
Re: - VASP 2023 Annual Renewal Fees – dated 14 February 2023
The Cayman Islands Monetary Authority (the “Authority”) is advising all registered virtual assets service providers (VASPs) that, as outlined in Schedule 2 of the Virtual Asset (Service Providers) Regulations 2020, their 2023 annual renewal fees will be the same amount as the fee paid at the time of registration.
The Authority has granted an extension until 15 March 2023 for the payment of said fees, failing which penalties for non-payment will accrue as outlined in section 5(5) of the Virtual Assets (Service Providers) Act (2022 Revision).
Should you require any further information, please contact firstname.lastname@example.org
Supervisory Information Circular
CIMA circular relating to 2023 audit plans: note typically, such circulars are published on CIMA’s website but in this particular instance, the circular was sent directly to the FSP.
On 3 January 2023, CIMA issued a circular to all securities investment business licensees, restricted licensees and registered persons setting out CIMA expectations that such persons undertake regular internal audits controls and infrastructure in order to ensure that they are suitably robust in consideration of the nature and scale of their operations. CIMA asked each person to provide within five (5) working days from the date of the circular a 2023 schedule of internal audit reviews.
CIMA: Publication / Newsletter / Reports & Surveys Re: The Anchor – April 2023
The Anchor, CIMA's AML/CFT bulletin published in April 2023, briefly covered the following topics:
Spotlight on Beneficial Ownership
Alert: Human Trafficking and modern slavery
Ransomware: Further Red Flag Indicators
Re: Financial Stability Report 2023 (FSR)
The first edition of the Cayman Islands Financial Stability Report (FSR) was published in January 2023. The following topics were covered: 1. Macroeconomic environment 2. Sectoral financial stability analysis 3. Sectoral macroprudential analysis 4. Regulatory & supervisory developments 5. Financial stability & climate change
Financial Reporting Authority (FRA)- general licenses for the payment of legal expenses under Russia’s sanctions regime.
On April 14, 2023, the Governor of the Cayman Islands issued a new General Licence, GL/2023/0001 - Legal Services(the Cayman General Licence). This authorizes any Person or Relevant Institution to receive payments from a Designated Person (DP) or carry out any other necessary actions.
The Cayman General Licence is in effect from April 14, 2023, and expires on October 14, 2023, and the Cayman Financial Reporting Authority’s press release can be found here.
The Cayman Islands Department for International Tax Cooperation (DITC)
On April 5, 2023, DITC released an Industry Advisory which provides the amended lists of CRS Participating Jurisdictions and Reportable Jurisdictions. DITC has released an updated edition (v. 9.3) of their DITC Portal -User Guide, which includes the following sections:
Refreshed graphics of gateway displays with improved filing instructions
New email addresses:
CRS / FATCA –DITC.Portal@gov.ky
Ministry of Financial Services & Commerce – FATF update
The Financial Action Task Force (FATF) plenary was held in Paris in February 2023. See the press release from the Cayman Islands Ministry of Financial Services & Commerce dated February 24th, 2023. The FATF has recognized the Cayman Islands' ongoing progress toward completing the final recommended action pertaining to investigations and prosecutions of money laundering cases, however, the jurisdiction remains on heightened monitoring.
The Cayman Islands will attend the FATF Joint Group's review meeting in June 2023 at which time it will provide a further update on progress.
05 April 2023
General Licence first issued in October 2022, expired on April 4, 2023 but is now extended for a further period of six (6) months from 5 April 2023.
1 May 2023
FATCA/CRS registration (one-time notification for new Cayman Islands Financial Institutions)
31 July 2023