The government announced several significant changes over the past year to its legal and regulatory framework surrounding the provision of financial services, designed to strengthen its alignment with international standards for Anti Money Laundering, transparency and economic substance requirements.
One of those changes was the introduction of the Private Funds Law, 2020, which meant that previously unregulated collective investment schemes needed to register with and be regulated by the Cayman Islands Monetary Authority (CIMA) as a Private Fund, to ensure better oversight of funds.
The other important step change was the Private Funds (Annual Returns) Regulations, 2021, issued in March, that now requires registered Private Funds to submit a Fund Annual Return (“FAR”) to CIMA in respect of each financial year, within six months after the end of the relevant financial year or within any extension of that period granted by CIMA.
FAR deadline looming
Importantly for Private Funds that have registered before and with financial periods ending prior to March 31, 2021, CIMA issued a notice in April extending the deadline for the first filing of audited accounts and the associated FAR form until the end of September, but which has now been extended further to October 31, 2021.
The Operators of the Private Fund have the overall responsibility for the completeness and accuracy of the returns. The operator of a fund is defined by CIMA as the directors of a fund that is a company, the general partners of a fund that is a partnership and/or the trustee of a fund that is a unit trust.
The annual return requires that the Private Fund includes various general operational, structural and financial information for the Private Funds. Where the Private Fund has not received capital contribution from investors for the purposes of investment, the Private Funds (Amendment) Regulations, 2021 require the operator to notify CIMA in the prescribed form that attests to this fact within six months after the end of the financial year to which it relates.
The submission to CIMA must be made via CIMA’s Regulatory Enhanced Electronic Forms Submission (“REEFS”) portal, along with the prescribed fee, and must include:
- The Private Fund’s completed FAR
- The Private Fund’s Related Fund Entities (“RFE”)
- The Private Fund’s audited financial statements
- The Operator Declaration signed by the Operator of the Private Fund
How can Apex Group help?
Our experienced team can assist with the preparation, filing and submission of FAR and CRS forms, and manage any relevant regulatory developments. To find our more please get in touch with our team.
