However, due to the tax-neutral nature of the jurisdiction, most people think company incorporation in the Cayman Islands is a cakewalk. While that is true to a certain degree, there are guidelines to be followed while incorporating a company in the Cayman Islands.
The strict yet pro-business approach is the reason why this tropical paradise has not been blacklisted by the global Financial Action Task Force and Economic Cooperation and Development.
Company formation in the Cayman Islands is pretty straightforward and flexible. In this blog, we will talk about the different stages of forming a company. Let’s get started.
Procedure to incorporate a company in the Cayman Islands.
Pre-incorporation
- Deciding the structure - The first step is to determine what type of company formation best suits your organisation. Depending on your business objectives, you can choose from an exempted company, an ordinary resident company, a non-resident company, or any other corporate structure. Also, you (or your company formation agent) have to figure out if there are any licensing requirements to be met or any changes need to be made to the model articles of association.
- Choosing a name - It is best to have at least three names to apply for the company registry. Interestingly, there is no compulsion for limited companies to use the word limited or similar derivatives, even if they are limited liability companies.
- Company constitution - A model memorandum and articles of association are provided in the Cayman Islands Companies Law. Draft a personalised company constitution or have your agent do it for you. The constitution should reflect your company’s vision, business needs, and objectives while complying with the governance requirements.
- Share allotment - Confirm the identity of the shareholders, the currency of the share capital, and the number, allocation, and value of the share that needs to be issued. To keep government fees to a minimum, ensure the share capital does not exceed CI$50,000.
- Director and shareholder selection - For company incorporation in the Cayman Islands, appointing one shareholder and director is a must. Even corporate directors are acceptable. The director has to sign a form agreeing to act as a director for the company.
- Registered address - For incorporating in the Cayman Islands, it is necessary to have a local registered office. Make sure the registered office’s address is mentioned in the incorporation service plan.
7. Planning - Now, you need to develop an elaborate engagement plan that explains the entire incorporation process right from start to finish. This plan should include the following. It will help you boost transparency, set client expectations, and ensure that the engagement is executed to perfection.
- Incorporation and business registration process.
- Document requirements
- Tax implications
- Obtaining necessary licenses.
8. Documents submission - Once you have all the necessary documents in order, you or your agent can submit the incorporation and business registration documents to the Cayman registry.
9. Approval - Assuming you have furnished all the required documents properly and that model articles are used (not amended), the incorporation process should take no longer than 2 to 3 business days.
10. Opening a bank account - Once you receive the company’s corporate documents, you need to open a corporate bank account. Take the help of your agent if you are unsure about the account opening procedure.
