Subject: Carne welcomes new CIMA consultation
From: "Carne Global" <[email-masked]>
To: <[email-masked]>
Date: 18 Jan 2013 11:11:01 +0000

Carne welcomes new CIMA consultation on governance and transparency of Cayman Islands funds

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Carne welcomes new CIMA consultation on governance and transparency of Cayman Islands funds
Proposals represent significant and positive changes to existing regime for regulation and supervision of fund directorships
CAYMAN ISLANDS January 2013: Carne Group, the global fund governance specialist, welcomes the consultation initiative and the decision by the Cayman Islands Monetary Authority (CIMA) to enhance and clarify corporate governance standards as they pertain to the large and flourishing Cayman Islands funds community.

The proposals include the extension of the current Statement of Guidance on Corporate Governance to all registrants, including registered mutual funds “to reinforce fundamental corporate governance standards expected from entities regulated and supervised by the Authority”. The draft Statement of Guidance has also been enhanced to clarify the role and duties of Cayman Islands fund directors in accordance with existing common law principles and international supervisory standards. CIMA has requested input as to whether the Statement of Guidance should apply across all sectors of the financial industry or should be tailored to relevant sectors.

The proposals also include a public database to facilitate due diligence, and increase transparency.

CIMA also proposes the extension of the Companies Management Law to apply to all directors, irrespective of their location. In particular, CIMA is proposing that directors with 6 or more appointments should be pre-approved and licensed. This brings sole practitioner individuals into the regulatory framework, and pre-approves employees of license-holders who act as directors. Those with fewer than 6 appointments must at least register with CIMA if any of the appointments relate to a regulated entity. This registration will apply to the typical ‘investment manager director’, who often sits on the board of a fund which he also manages.

CIMA has also commissioned an anonymous online survey through Ernst & Young which will focus on certain issues, including the hot-button issue of whether limits should be imposed on the number of appointments.

Finally, CIMA indicates in its consultation paper that there will be further future consultation regarding the use of corporate directors as opposed to individual directors, but that they welcome the industry’s initial thoughts on the subject.

Said Peter Heaps, Managing Director, Carne Cayman Islands: “These proposals represent a significant step forward for the Cayman Islands, as they will substantially enhance the levels of regulatory oversight of corporate governance in Cayman funds. They will help to bring the Cayman Islands funds regime more closely into step with accepted governance norms elsewhere in the world, enhancing this jurisdiction’s credibility and helping CIMA to provide a better investor protection framework.”

Roisin Cater, Principal with Carne Cayman Islands, added: “This consultation process comes partly thanks to the efforts of allocators, fund managers and other stakeholders, who have been lobbying CIMA for these changes for some time. CIMA is now formally seeking feedback on its proposals and we would urge industry participants, including investors in Cayman funds, to take the time to provide this. These changes will help the Cayman Islands to maintain its position as the domicile of choice for hedge funds, and its continued success as a leading international financial centre.”

The CIMA consultation paper and Statement of Guidance can be found here: http://www.carnegroup.com/document-library

In addition, should any industry participants or other stakeholders wish to submit their opinions via Carne Group, we will be collating responses from our clients to send to CIMA at the earliest available opportunity. (The consultation period will end on 18th March, 2013.) Please contact Stuart Fieldhouse, Director of Research, if you would like to submit any comments – details below.

ENDS

 

Contact:

RESEARCH
CAYMAN ISLANDS

Stuart Fieldhouse
Roisin Cater

Tel: (44) 7793 882230
+1 345 769 9901 begin_of_the_skype_highlighting +1 345 769 9901 FREE  end_of_the_skype_highlighting

Email: [email-masked]
[email-masked]

About Carne Group -

www.carnegroup.com http://www.carnegroup.com/

Carne is a leading international specialist in the provision of independent governance services to the global asset management industry. We advise both hedge funds and traditional fund managers on their governance needs, as well as providing independent directors to the boards of some of the most respected hedge funds globally. Carne has fund directors resident in the key fund jurisdictions, including the Cayman Islands, Ireland, Luxembourg, Switzerland, the United Kingdom and USA.

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Carne Global Financial Services Limited

http://www.carnegroup.com/ http://www.carnegroup.com/

Dublin - Cayman - London - Luxembourg - New York - Switzerland

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