March 22, 2019 2:55 pm
Amendments to NPO Law Take Effect
Two pieces of legislation to clarify Cayman’s regime for non-profit organisations (NPOs) will come into force on 1 April; meanwhile, later this year, a minor amendment to the local beneficial ownership framework will take effect.
The Non-Profit Organisations (Amendment) Law, 2018 (Commencement) Order, 2019 and Non-Profit Organisations (Registration Application) (Amendment) Regulations, 2019; and The Beneficial Ownership (Limited Liability Partnership) Regulations, 2019 were gazetted on Wednesday, 13 March.
The gazettal of NPO-related legislation facilitates the enactment of the NPO (Amendment) Law, 2018. This law was created to clarify the organisations that are in scope of the law, and those that are exempt; provide the Registrar of NPOs with the power to periodically assess Cayman’s NPO sector in order to identify any potential jurisdictional vulnerabilities to terrorist financing activities; and allow for expedited processing of applications. Meanwhile, the amendment to the NPO regulations reduces fees for filing changes.
These pieces of legislation supplement the legal framework created by the Non-Profit Organisations Law, 2017. The law formed part of the local preparations for the December 2017 Caribbean Financial Action Task Force (CFATF) assessment of the Cayman Islands regime to counter money laundering and terrorist financing. While charities in this jurisdiction are generally considered low-risk, the CFATF evaluation necessitated a local NPO registration process to gather empirical evidence on NPOs operating in the Cayman Islands to prove their risk is indeed minimal.
With regards to beneficial ownership (BO), The Beneficial Ownership (Limited Liability Partnership) Regulations, 2019 were approved by Cabinet in preparation for the commencement of the Limited Liability Partnership (LLP) Law later this year. The regulations will require LLPs to file their BO information with the competent authority (i.e. General Registry) in accordance with the current BO filings being done by limited liability companies and other types of companies.
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