Only one-fifth of charitable organizations have registered as nonprofit organizations under a law that was passed last year, according to the Ministry of Financial Services.
Failure to register by an Aug. 1 deadline will lead to penalties under the new Non-Profit Organisations Law, the ministry warned.
Just 63 nonprofit organizations had registered by April 16. According to the General Registry, there are at least 300 NPOs currently in local operations, a list that incudes sports associations, churches, community organizations and service clubs, the ministry stated in a press release Monday.
“Since last July, Registry and the Ministry of Financial Services have hosted numerous workshops, appeared on multiple radio shows, and sent multiple direct mails to a contact list of more than 300 potential NPOs,” said Paul Innis, the Registry’s head of compliance, in the statement.
“We strongly encourage persons to submit their applications for the NPO register by June 15, so that Registry has time to process them before the legal registration deadline of July 31, 2018. With so many applications outstanding, we want to make sure that there’s no backlog.”
The public will be able to see entities that have complied with the law in a newspaper advertisement that is scheduled to run on Friday, June 1, according to the press release.
Applications to register can be completed and filed via the Cayman Business Portal.
The ministry stated that nonprofit organizations that have not registered can learn about the legal requirements and receive counseling for completing their registrations.
The General Registry will hold two-hour registration workshops every Tuesday and Thursday at 5 p.m. at its offices on the ground floor of the Government Administration Building.
The workshops, which will be on an appointment basis, begin on Tuesday, May 8, and are expected to last until Thursday, June 28. Organizations that meet the legal definition of a nonprofit organization and register before the deadline will have their $300 application fee waived, the ministry stated.
Any nonprofit organizations that miss the July 31 legal deadline will be struck from the Companies Register and their assets would be vested in the Crown, the ministry warned. There are also penalties for charities if they do not register and continue to operate as a nonprofit after the July 31 registration deadline.
Those charities will face a $500 penalty for noncompliance, plus $10 for every day beyond Aug. 1, 2018, that they fail to apply for registration up to a maximum fine of $3,000, according to the ministry.
“The law will not only protect local residents from any potential bad actors but will further align Cayman with global regulatory standards which recognize that serious financial crimes, such as terrorist financing, can occur through NPOs,” Mr. Inniss said.
For more information, email Mr. Inniss at [email protected]