Since the proposed introduction of the AIFMD (“Alternative Investment Fund Managers Directive”) by the European Union in late 2010, CIMA (“Cayman Islands Monetary Authority”) has been actively involved in the process leading up to the implementation of this directive, which is due to become fully effective in July of 2013.
CIMA had estimated that around 26% of the Cayman Islands alternative investment funds would be affected, i.e. not be able to be marketed within EU-countries, unless the following conditions were met:
- A cooperation agreement in place with the Cayman Islands and EU-home member
- The Cayman Islands are not on the FATF list of non-cooperative jurisdictions
- Agreement for exchange of information for tax purposes are in place between EU Member States and the Cayman Islands
Cayman Islands Government passed the Monetary Authority (Amendment) Law, 2013 on March 15, 2013 allowing CIMA to enter into Memoranda of Understanding (“MoU”) with its EU counterparts, using a model MoU developed by the European Securities Markets Authority (“ESMA”).
As compliance with FATF standards and Cayman having agreements in place with (some, but not all) EU Member States for the exchange of information for tax purposes had previously been met, with the passing of the amendment, Cayman now complies with all 3 AIFMD conditions.
CIMA has confirmed that in addition to those agreements that have been signed, Cayman’s negotiations with other EU Member States for the exchange of information for tax purposes are underway.
Publication of the Monetary Authority (Amendment) Law, 2013 in the official newspaper of the Government of the Cayman Islands