Establishing a business in the Cayman Islands

Establishing a business in the Cayman Islands involves approvals by several government agencies depending on the type of business being established and the industry in which the business will operate. A company wishing to trade within the Cayman Islands, e.g., in retail trading, real estate, hotel operation, restaurants, maintenance services or local shipping, must obtain a licence under the Local Companies (Control) Law. No less than 60 percent of the equity must be Caymanian-owned and there should be more than 2/3 local directorship. Depending on the nature of business or industry, if less than 60 percent of the equity is Caymanian-owned, the Trade and Business Licensing Board will have to be convinced of the need for the company’s services. An application may go before the Trade & Business Licensing Board within four weeks or less of receipt of the application. This period may be greater, whenever an applicant has not provided all the requisite information.

Below is a general outline of this process.

Business Entity

Businesses in the Cayman Islands are usually established by an individual, a company, or a partnership:

Company

The registration of companies is governed by the Companies Law (2004 Revision), and all companies must be registered with the Registrar of Companies. Companies can be formed with one shareholder and with no minimum capitalisation requirements (except for Exempted Limited Duration Companies).

Client privacy is protected by the fact that the Registrar can only release the name and type of company, its date of registration, the address of the registered office and the company's status. Disclosing any other information is prohibited except where assistance to law enforcement agencies is required.

Businesses that intend to operate in the jurisdiction are typically incorporated as a 'Resident Company'. Resident Companies are companies carrying on business in the Cayman Islands, which must report annually to the Registrar and which can hold land. As an alternative, companies that are incorporated outside of the Cayman Islands that wish to carry on business locally can register as a 'Foreign Company'.

Click here for details on the ways in which a company may be registered in the Cayman Islands.

Partnership

Limited partnerships, which can be formed by two or more people or companies, are governed by the Partnership Law (2002 Revision), which requires them to be registered with the Registrar of Limited Partnerships.

Click here for details on registering a limited partnership in the Cayman Islands.

Business Licensing

All businesses and professionals operating in the Cayman Islands must be licensed under the law relevant to their industry.

General Business Licences

Trade and Business Licences are administered through the Trade and Business Licensing Board of the Immigration Department as specified under the Trade and Business Licensing Law (2003 Revision). The fees for licence application and annual renewal depend on the broad nature of the business and/or profession. Certain types of business premises, such as restaurants, also require inspection by the Department of Environmental Health.

In addition, foreign-owned or controlled companies doing business in the Cayman Islands must obtain a licence under the Local Companies (Control) Law (1999 Revision). A company is considered foreign owned if less than 60 per cent of the equity is owned by Caymanians or if less than 60 per cent of the board of directors is Caymanian. This licence has a maximum duration of 12 years, but a longer period may be approved by the Governor.

For more details, please visit the Immigration Department website.

Financial Services Licences

Companies operating in the financial services industry must apply for the license relevant to its industry from the Cayman Islands Monetary Authority (CIMA). CIMA is responsible for processing applications, regulation and supervision of the following types of businesses:

* Banks and Trust Companies

* Insurance Companies

* Fiduciary Services (Companies Management, Corporate Services, Trust Companies in of companies without a banking licence)

* Investment & Securities Services (Mutual Funds, Mutual Fund Administrators, Securities Investments Businesses)

For more details, please visit the Cayman Islands Monetary Authority website.

Hotel Licences

Hotels seeking to operate in the Cayman Islands must apply for a hotel licence from the Hotel Licensing Board under the Tourism Law (1995 Revision). This process is administered through the Department of Tourism.

A Trade and Business Licence is not required, but a LCCL is required if the level of Caymanian participation does not meet the threshold stated in law.

Telecommunications and Radio Licences

The Information and Communications Technology Authority (ICTA) is an independent statutory Authority which is responsible for the regulation and licensing of Telecommunications, Broadcasting, and all forms of radio which includes ship, aircraft, mobile and amateur radio. The ICTA conducts the administration and management of the .ky domain, and also has a number of responsibilities under the Electronic Transactions Law 2000.

A Trade and Business Licence is not required for a business licensed by the ICTA, but a Local Companies (Control) Licence is required if the level of Caymanian participation does not meet the threshold stated in law.

For more details, please visit the Information and Communications Technology Authority website.

Building Regulations

Applications for permission to carry out development must be made to the Planning Department in accordance with land uses indicated in the Development and Planning Law (2003 Revision), Development and Planning Regulations (2003 Revision), and the Cayman Islands Development Plan.

Applications for planning permission to carry out development must be made to the Central Planning Authority (CPA) in Grand Cayman and the Development Control Board (DCB) in the Sister Islands. Land uses (zoning) are indicated by The Development Plan. Planning permission is required even for an established location where the intended use of the location is significantly different from what was originally approved.

A building permit is required prior to start of construction and a Certificate of Occupancy is required before buildings can be occupied. In certain limited circumstances, home offices are permitted subject to conditions restricting and limiting the scope of activities within the designated address. Applicants are advised to consult the Planning Department for advice on registering a business at a private residence.

All major developments must go to the Central Planning Authority (CPA) for approval. The CPA may require an Environmental Impact Assessment depending on the project (type and size) and its impacts. Advice on the environmental impact of development projects is taken from the Department of Environment. The Department of Environment encourages pre-application consultation with project proponents to discuss areas of environmental concern or mitigating impacts through best management practices and other internationally accepted mechanisms.

For more details, please visit the Planning Department website.

Work Permit Requirements

Non-Caymanians or people not legally and not ordinarily resident in the Cayman Islands aren not allowed to work in the Cayman Islands without a work permit.

Under the Immigration Law (2003), a person or his/her employer may apply for a work permit to the Work Permit Board or the Business Staffing Plan Board for employment in Grand Cayman, or to the Cayman Brac and Little Cayman Immigration Board for employment in the Sister Islands.

In Grand Cayman, all businesses employing fifteen or more work permit holders must submit their work permit application through the Business Staffing Plan Board as opposed to the Work Permit Board. Businesses employing fewer than fifteen work permit holders have the option of applying to either of these boards.

The boards may grant work permits for up to three years. Five-year permits can also be granted to holders of certain positions that have been approved under a business-staffing plan. A work permit holder can work continuously for no more than seven years. After this, the board can’t normally grant any further work permits until that person has left the Islands for at least two years. The only exceptions to this would be a worker designated an ‘exempted employee’ in a business staffing plan, or where there are exceptional circumstances. In such cases, the board may, at its discretion, grant additional work permits to enable the person to complete an aggregate period of eight years, thus making him or her eligible to apply for the status of permanent residence.

For more details, please visit the Immigration Department website.

Terms of Employment

Under the Labour Law (2001 Revision), every employer who enters into a contract of employment with an employee shall within ten working days of entering into such contract, furnish the employee with a written statement of his conditions of employment. This statement covers, amongst other things, job title, responsibilities, special requirements, regular working hours, rate of remuneration, and period of employment if any.

Labour Tribunals have been established under the Law for the purpose of hearing complaints from employers and employees, though provision has also been made for the complaints to first go through a Conciliation and Mediation process. In the event that this process fails to resolve the situation it is then referred to the Labour Tribunal. For more information, please visit the Department of Employment Relations website.

There is currently no National Minimum Wage in the Cayman Islands.

Under the Health Insurance Law (2003 Revision), an employer must pay the standard premium of any standard health insurance contract issued by an approved insurer. Up to 50 per cent of this premium can be recovered directly or deducted from the employee's salary. Health insurance coverage is also required for an employee within the first fifteen days of employment. For more details, please visit the Health Insurance Commission website.

Under the National Pensions Law (2000 Revision), employers don’t have to provide pension plans or contribute to pension plans for employees who do not have Caymanian status, or who are not permanent residents in the Cayman Islands during the first nine months of their employment.

Employers are responsible for providing a pension plan for eligible employees, and for maintaining current information with the National Pensions Office. For more details, please visit the National Pensions Office website.

Can I work while I’m visiting the Cayman Islands?

A casual visitor is not permitted to take up or solicit employment while in the Islands. A work permit must be applied for and obtained before arrival, either by the individual, if he is to be self-employed, or by the employer with a post to fill. A work permit entitles the holder and named dependents (normally limited to three) to live in the Islands during the term of the license or specific employment. Dependents will not be allowed to work without their own licenses.

If you're planning a business trip, know in advance that sales people planning to solicit business and take orders in our islands require a temporary work permit. Applications for this may be obtained in advance from the Department of Immigration. Contact their office weekdays between 9 a.m. and 4 p.m. at (345) 949-8344. You also must declare all samples of goods you're bringing into the country and these must leave with you.

Under Immigration Laws visitors are not allowed to accept jobs in the Cayman Islands without a government-issued work permit.

Dengue Fever Cover Up Claimed

The Health Services Authority and Department of Public Health is embroiled in controversy over claims about whether there were cases of dengue fever on Grand Cayman.

Last Tuesday, Acting Director of Public Health, Dr. Anna Matthews, told the Caymanian Compass there were no cases of dengue fever being treated at the hospital, but said there had been one suspected case that was later ruled out.
The following day, the HSA issued a dengue fever alert stating that there were “currently no known active cases in the Cayman Islands.”
But on Thursday night, Leader of the Opposition McKeeva Bush went on Radio Cayman, questioning why the Public Health Department was claiming there were no cases of dengue fever on the island, when they had confirmed to him that they were treating cases of the dangerous disease.
“It was very tongue–in–cheek to say the least, if not disingenuous, to say there are currently no known active cases in the Cayman Islands. That simply cannot be true,” said Mr. Bush.
Mr. Bush’s statement forced the HSA to issue another press release Friday morning admitting that it had “become aware” of one confirmed and two suspected cases of dengue fever in people that had recently returned from countries with dengue fever.
On Friday, Director of Public Health, Dr. Kiran Kumar – who was at a conference in Canada last week – said the Department of Public Health knew on Monday, 15 October of the one confirmed and two suspected cases, and had immediately passed that information on to the Mosquito Research and Control Unit and other governmental agencies.
The patient with a confirmed case of dengue fever recently travelled to Nicaragua, Mr. Kumar said, while the two patients with suspected cases had recently visited Jamaica. Like many other Caribbean and Central American countries, Jamaica and Nicaragua are experiencing one of their worst dengue fever outbreaks in years.
Two of the affected patients remain on island, while one, who was visiting Cayman, has returned to Jamaica.
Speaking from Canada, Mr. Kumar – who has a track record of openness with the media about public health issues – said he was not sure if there had been a communication mix–up.
“When I heard about the press release saying there were no known cases in Cayman, as soon as I heard, at 1am (Friday morning), I woke up and wrote the press release to correct that.
“We are not here to hide anything. There might have been an error made and yes I take responsibility if somebody in my department made that error, but I don’t think it was intentional.”
On Friday, Mr. Bush questioned whether the public had been put in danger by what he described as an HSA cover–up.
“The [Aedes aegypti mosquito] is here and [the infected patients] could have passed this on and no public alert went out.
“The public should have been alerted to it earlier so they could take necessary precautions,” he said.
Mr. Bush claimed the Public Health Department had told him it first became aware of a suspected case of dengue fever 4 October.
“Yesterday was the 18th. That gave them two weeks past when the Public Health Department first were notified about it.”
Mr. Kumar said it could take between seven and 10 days for lab analysis in Miami to confirmed suspected dengue cases.
But Mr. Bush said he suspected a whitewash.
“I think they have lied to the media and they have lied to the public,” he said.
On Friday the MRCU confirmed it had stepped up efforts to control the Aedes aegypti mosquito.
MRCU Director Bill Petrie said, “Immediately upon receiving the news from Public Health we mobilised crews to treat the areas near the homes of the patients and to investigate the surrounding neighborhoods for potential breeding sites of the mosquito.” The main areas of operation include West Bay and South Sound.”
MRCU crews are concentrating their efforts in the neighborhoods of the patient’s homes and in areas of the island where Aedes aegypti numbers are known to be high. Crews are applying granules and spraying insecticide near residences in order to reduce numbers of the mosquito as well as collecting samples for identification and research.
Mr. Petrie said the Cayman Islands is at a heightened risk of dengue fever due to high densities of the Aedes aegypti mosquito on some parts of Grand Cayman and are keenly aware of the risk posed by residents and visitors returning from areas where there are outbreaks of dengue fever.
The news of dengue fever cases being treated in Cayman comes as parts of the Caribbean and Latin America are reporting some of the worst outbreaks of dengue fever in decades.
So far this year, 643, 123 cases of dengue fever have been recorded throughout the Caribbean and Latin America and 186 people have died as a result.
Although dengue fever is not endemic to Cayman, Hurricane Ivan in 2004 spawned a 1,300 per cent increase in the population of Aedes aegypti mosquitoes, a potential dengue fever vector. Aedes aegypti breeds predominantly around houses and is a day–biting mosquito.
Mr. Petrie said the public has a vital role to play controlling Aedes aegypti by reducing standing water in their yards where the mosquitoes breed and larvae develop, by turning over buckets, draining plant pots and unblocking guttering.
FYI
Dengue fever symptoms include a sudden onset of fever, with severe headache, muscle and joint pains, usually four to seven days after the bite of an infected Aedes aegypti mosquito. Many patients may also develop nausea, vomiting and bright red rashes on chest, arms, legs, and face.
However, in milder cases, symptoms can be misdiagnosed as the common flu, said Dr. Kumar in the press release.
Dengue fever cannot be transmitted from person to person, but Aedes Aegypti mosquitoes can transmit the disease to healthy people after biting someone infected with the disease.
There is no vaccine or treatment for dengue fever.

Little Known Immigration Law May Impact Residents

A little known section of the Immigration Law will have a big impact on residents who were born in Cayman between 27th May 1977 and 1st January 1983.

They may have to apply to the Chief Immigration Officer for the right to be Caymanian.

This part of the law is for residents who were born in the Cayman Islands but whose parents are not Caymanians.

The deadline to apply for the right to be Caymanian is 21st December 2007.