• Cayman Islands Exempted Limited Duration Company

  • GENERAL

    Legal Framework

    Cayman Islands Exempted Limited Duration Companies are governed by the Cayman Islands Companies Law.

    The Companies Law allows for an Exempted Company to be registered as a Limited Duration Company.

    Special Characteristics

    An Exempted Limited Duration Company is a variant of the Exempted Company.

    The duration of an Exempted Limited Duration Company should be up to 30 years.

    Upon the lapse of the duration of the company it is deemed to have automatically commenced voluntary winding up and dissolution.

    An Exempted Limited Duration Company is prohibited from trading in the Cayman Islands. However, it may enter into contracts in the Cayman Islands, which are necessary to carry on its business outside the Cayman Islands e.g. contracts with service providers etc.

    The name of an Exempted Limited Duration Company should include the words "Limited Duration Company" or "LDC".

    The main advantage of an Exempted Limited Duration Company is that it preserves the limited liability of members, but has some characteristics of a partnership (e.g. limited duration and non-transfer ability of interests without the consent of all members) which may lead to a favorable tax treatment for its members in certain foreign jurisdictions where it may be treated as a partnership.

  • SHAREHOLDERS

    Liability of Shareholders

    The liability of the shareholders of an Exempted Limited Duration Company is limited up to the unpaid amount of the shares they hold.

    Minimum Number of Shareholders

    The minimum number of shareholders of an Exempted Limited Duration Company is 2 and the maximum is unlimited.

    Restriction on Nationality/Residency of Shareholders

    There is no restriction on the nationality or residency of the shareholders.

    Corporate Shareholders

    The shareholders of an Exempted Limited Duration Company can be individuals and/or legal persons.

    Nominee Shareholders

    The use of nominee shareholders is allowed.

  • DIRECTORS

    The Articles of Association of an Exempted Limited Duration Company may provide that the management of the company is vested to its shareholders. In such circumstances, the shareholders are considered as the directors of the company and if permitted by the Articles of Association they may delegate their responsibilities to a properly appointed Board of Directors.

    Minimum Number of Directors

    The minimum number of directors of a Limited Duration Company is 1.

    Restriction on Nationality/Residency of Directors

    There is no restriction on the nationality or residency of the directors.

    Corporate Directors

    The directors can be individuals and/or legal persons.

  • SHAREHOLDER MEETINGS

    Shareholder Meetings

    There is no requirement for an Exempted Limited Duration Company to hold an annual general meeting.

  • CAPITAL

    Minimum Capital Requirement

    There is no minimum capital requirement for an Exempted Limited Duration Company.

    Currency of Capital

    The share capital of an Exempted Limited Duration Company can be denominated in any currency.

    Non-par Value and Bearer Shares

    The Law permits an Exempted Limited Duration Company to issue shares without nominal or par value.

    The Law also permits an Exempted Limited Duration Company to issue bearer shares, although such shares are required to be held by an authorized custodian within the Cayman Islands.

    Capital Duty

    There is a capital duty of CI$50 on the issuance of shares.

  • REGISTERED OFFICE

    Registered Office

    It is a legal requirement for every company in the Cayman Islands to have a registered office in the Cayman Islands.

    Company Secretary / Registered Agent

    Every company in the Cayman Islands should have a local registered agent.

  • FOREIGN INVESTORS

    Restrictions on Foreign Investors

    There are no restrictions on foreign investors investing in an Exempted Limited Duration Company in the Cayman Islands.

  • FORMATION

    Time Needed for Incorporation

    It usually takes 3 - 4 days to register a company in the Cayman Islands.

    Shelf companies are available.

  • CONFIDENTIALITY

    Beneficial Owners

    The details of the beneficial owner are disclosed to the service provider and are not available on public record.

    Registered Shareholders

    The details of registered shareholders are not available on public record.

    Directors

    The details of directors are not available on public record.

    Financial Statements

    The financial statements are not publicly accessible.

  • FILING REGUIREMENTS

    Filing with the Registrar of Companies

    An Exempted Limited Duration Company should submit a very simple annual return in January each year, which includes a statement, signed by the company secretary or director, confirming that the company conducted its business outside the Cayman Islands.

    Filing with the Tax Authorities

    An Exempted Limited Duration Company does not need to submit an annual tax return or its annual accounts to the Tax Authorities.

  • RECORDS

    Accounting Records

    An Exempted Limited Duration Company needs to maintain accounting records. These can be maintained outside the Cayman Islands and in any currency.

    Financial Statements

    An Exempted Limited Duration Company does not need to prepare annual financial statements.

  • AUDIT

    Audit Requirement

    The Law does not require the accounts of an Exempted Limited Duration Company to be audited.

Compare Cayman Islands to other jurisdictions and see the difference in corporation tax rates, tax residency requirements, VAT rates, capital gain taxes, etc.

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