Glossary

Clarity in every term.

A plain-English guide to Cayman funds, governance and corporate services.

Compliance & AML

Anti-Money Laundering Compliance Officer

The officer responsible for overseeing a Cayman entity's AML/CFT compliance framework and its day-to-day operation.

Compliance & AML

Beneficial Ownership

The natural persons who ultimately own or control a Cayman entity, information on whom must be maintained under the beneficial ownership regime.

Web3 & Digital Assets

Cayman Foundation Company

A Cayman company that can operate like a foundation — with no shareholders and beneficiaries or purposes — widely used for DAOs, token projects and ownerless structures.

Regulatory Bodies & Instruments

Cayman Islands Monetary Authority

The primary financial services regulator of the Cayman Islands, responsible for supervising funds, regulated entities and service providers.

Fund Structures & Vehicles

Closed-ended Fund

A fund whose interests are not redeemable or repurchasable at the investor’s option, typically returning capital through distributions.

Compliance & AML

Common Reporting Standard

The OECD global automatic exchange of financial account information, under which Cayman entities identify and report account holders' tax residences.

Regulatory Bodies & Instruments

Companies Act

The principal Cayman statute governing the incorporation, administration and winding-up of companies.

Governance

Company Secretary

The office responsible for a company's statutory records, filings and board administration.

Governance

Conflicts of Interest

Situations where a person's duties or interests compete, requiring identification, disclosure and appropriate management.

Economic Substance

Core Income-Generating Activities

The essential, value-driving activities that an in-scope Cayman entity must conduct in the Islands to satisfy the economic substance test.

Web3 & Digital Assets

Decentralised Autonomous Organisation

A blockchain-based organisation governed by its participants, often wrapped in a Cayman foundation company for legal personality.

Compliance & AML

Deputy Money Laundering Reporting Officer

The deputy to the MLRO, who performs the reporting-officer function in the MLRO's absence.

Fund Structures & Vehicles

Digital Asset Fund

A Cayman fund investing in cryptocurrencies, tokens or other digital assets, regulated under the same fund regimes as traditional funds.

Regulatory Bodies & Instruments

Directors Registration and Licensing Act

The Cayman regime for registering or licensing directors of covered entities, distinct from private-fund governance requirements.

Economic Substance

The Cayman requirement that entities carrying on certain relevant activities demonstrate adequate substance in the Islands.

Economic Substance

Economic Substance Notification

The annual filing by which a Cayman entity declares its economic substance classification and whether it carries on a relevant activity.

Economic Substance

Economic Substance Return

The annual report a relevant entity carrying on a relevant activity files to demonstrate it meets the economic substance test.

Corporate Vehicles

Exempted Company

The most common Cayman corporate vehicle; a company that does not carry on business with the public in Cayman and enjoys administrative flexibility.

Fund Structures & Vehicles

Exempted Limited Partnership

A Cayman partnership with at least one general partner and one limited partner, widely used for closed-ended private equity and venture funds.

Compliance & AML

FATCA

The US-driven automatic exchange regime under which Cayman financial institutions identify and report US account holders.

Fund Structures & Vehicles

Feeder Fund

A fund through which investors access a strategy by investing substantially all of its assets into a master fund.

Governance

Fiduciary Duty

The legal obligation of a director or other fiduciary to act in good faith and in the best interests of the entity they serve.

Regulatory Bodies & Instruments

Foundation Companies Act

The Cayman legislation enabling foundation companies, widely used for DAOs, token projects and ownerless structures.

Governance

Foundation Supervisor

A person appointed to oversee the directors of a Cayman foundation company where it has no members.

Fund Structures & Vehicles

Fund of Funds

A fund that invests primarily in other funds rather than directly in securities, providing diversified manager exposure.

Fund Structures & Vehicles

General Partner

The partner that manages an exempted limited partnership and bears unlimited liability for its obligations.

Fund Structures & Vehicles

Hedge Fund

An open-ended pooled vehicle pursuing an actively managed, often alternative, strategy with redeemable investor interests.

Corporate Vehicles

Holding Company

A Cayman company established to hold shares or assets in subsidiaries or investments rather than to trade directly.

Governance

Independent Director

A director appointed to exercise objective judgement and oversee governance, conflicts and service providers independently of management.

Compliance & AML

Know Your Customer

The process of identifying and verifying investors and understanding their source of funds, as part of customer due diligence.

Corporate Vehicles

Limited Liability Company

A flexible Cayman body corporate with separate legal personality and members whose liability is limited, combining company and partnership features.

Fund Structures & Vehicles

Limited Partner

An investor in a limited partnership with rights, commitments and liability determined by its agreement and the statutory framework.

Fund Structures & Vehicles

Limited Partnership Agreement

The private contract governing an exempted limited partnership, setting out economics, governance and investor rights.

Fund Structures & Vehicles

Managed Account

A segregated portfolio managed for a single investor under an investment management agreement, rather than a pooled fund.

Fund Structures & Vehicles

Master-Feeder Structure

A fund structure in which one or more feeder funds invest substantially all of their assets into a single master fund that trades the strategy.

Fund Structures & Vehicles

Master Fund

The fund in a master-feeder structure that holds the assets and conducts the trading, into which the feeder funds invest.

Compliance & AML

Money Laundering Reporting Officer

The natural person appointed to receive and assess internal suspicious activity reports and liaise with the Cayman Financial Reporting Authority.

Fund Structures & Vehicles

Mutual Fund

A Cayman fund whose investors can redeem or withdraw their interests at their option, generally regulated by CIMA under the Mutual Funds Act.

Regulatory Bodies & Instruments

Mutual Funds Act

The Cayman legislation governing the registration and regulation of open-ended funds with CIMA.

Governance

Net Asset Value

The value of a fund's assets less its liabilities, usually expressed per share or unit and used for subscriptions, redemptions and reporting.

Governance

Offering Memorandum

The document offering interests in a fund, describing its strategy, terms, risks, fees and conflicts.

Fund Structures & Vehicles

Open-ended Fund

A fund whose investors can redeem their interests at their option, typically regulated under the Mutual Funds Act.

Fund Structures & Vehicles

Private Credit Fund

A closed-ended fund that originates or invests in private debt, typically structured as an exempted limited partnership.

Fund Structures & Vehicles

Private Equity Fund

A closed-ended fund that acquires equity stakes in private companies, typically structured as an exempted limited partnership.

Fund Structures & Vehicles

Private Fund

A pooled investment structure with interests not redeemable at the investor’s option, subject to Cayman statutory scope and exclusions.

Regulatory Bodies & Instruments

Private Funds Act

The Cayman legislation governing the registration and ongoing regulation of closed-ended private funds with CIMA.

Compliance & AML

Proliferation Financing

The provision of funds or services used to manufacture or acquire weapons of mass destruction, subject to specific risk-assessment obligations.

Fund Structures & Vehicles

Registered Fund

A Cayman open-ended fund registered with CIMA under section 4(3) of the Mutual Funds Act, the most common registration category for hedge funds.

Corporate Vehicles

Registered Office

The official Cayman address of an entity, provided by a licensed service provider, for service and statutory records.

Economic Substance

Relevant Activity

One of the defined categories of business that triggers the economic substance test for a relevant entity.

Economic Substance

Relevant Entity

An entity within the scope of the Cayman economic substance regime that may need to satisfy the substance test.

Web3 & Digital Assets

SAFT

A contractual instrument under which investors fund a project in exchange for the right to receive tokens on a future event.

Compliance & AML

Sanctions Screening

Checking investors and counterparties against applicable sanctions lists to prevent prohibited dealings.

Fund Structures & Vehicles

Segregated Portfolio

A ring-fenced pool of assets and liabilities within a segregated portfolio company, legally separated from the company's other portfolios.

Fund Structures & Vehicles

Segregated Portfolio Company

One Cayman company with statutory separation between portfolios, each of which operates within the SPC’s single legal personality.

Governance

Side Letter

A separate agreement granting a particular investor terms that vary from or supplement the fund's standard terms.

Fund Structures & Vehicles

Side Pocket

A separate designation within a fund holding illiquid or hard-to-value assets, ring-fenced from ordinary subscriptions and redemptions.

Corporate Vehicles

Special Purpose Vehicle

A Cayman entity established for a specific, often single, transaction or holding purpose, to isolate assets or risk.

Regulatory Bodies & Instruments

Statement of Guidance

CIMA guidance setting out its expectations of how regulated entities should meet their obligations.

Compliance & AML

Suspicious Activity Report

A report made to the Cayman Financial Reporting Authority where there is knowledge or suspicion of money laundering or related conduct.

Regulatory Bodies & Instruments

Tax Information Authority

The Cayman competent authority for international tax cooperation, including FATCA and CRS reporting.

Web3 & Digital Assets

Token Generation Event

The event at which a project's tokens are created and first distributed to holders.

Fund Structures & Vehicles

Tokenised Fund

A fund whose investor interests are issued and recorded as blockchain-based tokens rather than traditional shares or units.

Web3 & Digital Assets

Token Issuer

The entity that issues a project's tokens, commonly a Cayman foundation or company, subject to structuring and regulatory analysis.

Fund Structures & Vehicles

Umbrella Fund

A single fund structure, often an SPC, that houses multiple sub-funds or portfolios under one legal entity.

Fund Structures & Vehicles

Unit Trust

A fund constituted as a trust, in which a trustee holds assets on trust for investors who hold units.

Governance

Valuation Policy

A documented framework setting out how a fund's assets are valued, by whom, and how frequently, to ensure a reliable NAV.

Fund Structures & Vehicles

Venture Capital Fund

A closed-ended fund investing in early-stage and growth companies, usually as an exempted limited partnership.

Web3 & Digital Assets

Virtual Asset

A digital representation of value that can be traded or transferred and used for payment or investment, as defined under the VASP Act.

Web3 & Digital Assets

Virtual Asset Service Provider

A business providing specified virtual asset services, with Cayman registration or licensing determined by the activities undertaken.

Discuss your requirements.

Speak with our team about your fund or corporate structure.

Start your request