Cayman Islands Financial Services Association says it welcomes recent developments in the US which may require companies to supply information along the same high standards which have been implemented in the Cayman Islands for years.
A release issued by CIFSA refers to a statement made on 1 May by US Senator Carl Levin when he was introducing the ‘Incorporation Transparency and Law Enforcement Assistance Act’ in the United States Senate.
‘Each year the United States allows persons to form nearly two million corporations and limited liability companies in this country without knowing – or even asking – who the beneficial owners are behind those corporations,’ Mr. Levin said at the time.
‘Most offshore jurisdictions already request this information as well, including the Bahamas, Cayman Islands, Jersey, and the [Isle] of Man.,’ he said.
‘Our States should be asking for the same ownership information, but they don’t, and there is no indication that they will any time in the near future, unless required to do so.’
Unlike the United States, the Cayman Islands directly regulates all service providers who are responsible for incorporating companies as these are all licensed and regulated by the Cayman Islands Monetary Authority (CIMA).
Such services providers are also subject to onsite inspections by CIMA. No such regulation exists in the United States for equivalent service providers and Mr. Levin is now seeking to raise the standards in this area in the United States.
‘We believe it is important that recognition of the higher standards of company incorporation in the Cayman Islands is recognised as this has been in place for many years’, says Eduardo Silva, Chairman of CIFSA.
He commented the comments made by Mr. Levin are important because there is a common misconception that the regulatory standards of offshore centres like the Cayman Islands is of a lower standard than that which exists in OECD countries.
But closer inspections show there is a stark contrast in many areas and that in fact the standard applied offshore is much higher than the level applied in the onshore countries like the United States and in the UK.
‘Statements like Mr Levin’s, which reveal the higher standards in places like the Cayman Islands are important in clarifying that we are still some way off from having a level playing field as far as regulation is concerned,’ said Mr Silva.
‘We hope that discussion of this bill promotes a more balanced discussion of the well-regulated, high quality work performed in the Cayman Islands.’