“We want to make sure that
we are pouring our resources
in the areas that work very
synergistically.” Jude Scott
to handle it and how would the boards fulfil their oversight duties.
But, in actual fact, it has very quickly become standard practice. To
give kudos to the fund administrators, they have very much led the
charge on FATCA and CRS. It’s been much less of an issue from the
governance side than you would have expected.
Nicol: I was encouraged to hear Dan say there are benefits to FATCA
in terms of getting the right information from the underlying clients
and being able to comply with the regulations so that’s good to hear.
Has it gone smoothly? Yes and no. On FATCA a number of changes
took place at the US level which caused a lot of headaches for us
on the government side, as much as they did in industry. From our
perspective, FATCA has gone reasonably well and the key thing has
been to do the exchanges and honour our international agreements.
The collaboration of industry has been excellent.
One thing to note about FATCA, and the same applies to CRS, is that
Cayman is a non- reciprocal jurisdiction. What we do is gather and
provide information. It’s supposed to be exchange of information—
it’s not, it’s provision of information out of Cayman, we don’t receive
anything, but once the information goes to the US of course there is
a feedback mechanism. Although we are a provider of information to
the US or, in the case of CRS, to other countries, it doesn’t mean that
the process stops once the information crosses the border.
Collins: In the short term, it was difficult for some managers to
accept having to pay for that final audit if they themselves were
acting as voluntary liquidator. However, when you step back from
the situation and look at it from a regulatory perspective, it’s a very
efficient way of holding people’s feet to the fire to the final day, to
ensure that they manage the fund to the very end.
Has the FATCA and CRS process
Dan Allard: To make a brief comment on the Foreign Account Tax
Compliance Act (FATCA), as an association we feel we’ve got a good
process in place, and a good partnership with the government and Cayman
Finance to help determine the best way to administer that regulation.
There are some items needed for the CRS to be able to properly meet
these requirements but overall we feel that with all these regulations
and the requirement within the industry to be transparent, it’s made
it easier in some cases for the administrators to ask for that extra
information on beneficial ownership, which demonstrates that there
have been some benefits.
Collins: You’ve hit the nail on the head. When CRS and FATCA came
out, there was a big question mark as to how funds were going
“If you’re a Millennial
we’ll find ways to keep you
motivated to come into the
office every single day.”
CAYMAN FUNDS | 2017