OFFSHORE Series | Understanding Offshore Company Registers through Practical Examples (Part 2) - An Example of Cayman Companies.
Editor's Note:
As economic globalization advances, an increasing number of domestic capital is seeking international market development. Apart from a few enterprises that directly invest, most companies choose to establish offshore entities as Special Purpose Vehicles (SPVs) for global investment.
Among the offshore registration jurisdictions, the British Virgin Islands (BVI) and the Cayman Islands are currently popular choices, with BVI and Cayman companies being the most commonly used SPVs.
This article series consists of two parts, focusing on the Register of Members (ROM) for BVI companies and Cayman companies, respectively. By analyzing relevant laws and providing practical examples, we aim to explore the purposes, interpretations, and important considerations of offshore company registration documents for reference.
Regulations on ROM in the Cayman Islands Companies Act
Similar to the BVI Companies Act, the Cayman Islands Companies Act (2023 Revision) also contains corresponding provisions regarding ROM.
Example and Analysis of ROM in Cayman Islands Companies
Compared to the ROM of BVI companies, the required content and information in the ROM of Cayman companies are nearly identical. The difference lies in the fact that the common authorized share capital of BVI companies is 50,000 shares, and exceeding this amount requires additional special modifications, resulting in increased overall costs. In contrast, the authorized share capital of Cayman companies is commonly set at USD 50,000, and the company can control the number of shares issued by adjusting the face value. If the authorized share capital exceeds USD 50,000, it involves other special modifications and also leads to increased overall costs.
Part 1: Share Details
According to the statutory requirements, this section includes Share Class, Certificate Number, Member Name and Address, Number of Shares Held, Voting Rights (with additional conditions), Date Entered as a Member, Date Ceased as a Member, and Notes.
It is worth noting that the Notes section of the form provides details on share issuance and transfers, which can be used to understand the source and transfer of shares.
Part 2: Summary of Share Capital
The summary of Share capital mainly includes the Class of all issued shares, Currency, Authorized capital, Number of shares authorized, Nominal Value per share, Number of shares issued, and Voting rights (with additional conditions).
Part 3: Current Shareholder List
This section mainly includes shareholder Names, Class of Shares Held, Number of Shares Held, and Voting Rights (with additional conditions).
Conclusion
By analyzing and interpreting the relevant laws and actual ROM documents of BVI and Cayman companies, it is evident that legal provisions guide practical operations, and practical operations reflect specific implementations of legal provisions. Although the format and style of ROM documents may vary due to different issuing institutions, the content of the register of members must comply with statutory requirements.
As mentioned earlier, ROM plays a crucial role in determining the legal status of shareholders in BVI and Cayman companies. Through this two-part article series, we hope to help you understand ROM, gain insights into the historical evolution and equity changes of these offshore companies that seem distant and make appropriate and prudent investment decisions.
Of course, besides the register of members, other documents such as the register of directors, register of ultimate beneficial owners, and declaration of economic substance also have their uses in cross-border investments and are equally important. If you have any questions related to BVI companies/Cayman companies or other offshore company matters (including but not limited to ROM), please feel free to contact our professionals.