A sound reputation
Cayman responds positively to global regulatory standards and will continue
to promote a healthy business environment, writes the Hon. Tara Rivers,
Minister for Financial Services and Home Affairs.
value the input of this sector and place great importance on the role of
The Cayman Islands government, CIMA and our industry practitioners
are aware of our responsibility to captives and our wider local economy.
We also are aware of our responsibility to cooperate, despite the nature
of competition, with jurisdictions that are signed up to and practise
global standards, and are therefore part of the checks and balances on
the global financial services system.
We uphold these standards because they help to uphold economies—
in the US, Europe, in Cayman, and worldwide. We welcome the fact that
more countries are signing up to these standards, because we know
this means there will be fewer places for illicit activity to hide. Our firm
belief is that global standards are the best way to ensure that taxpayers,
governments, citizens and business itself are protected from criminality.
CIMA’s efforts have not gone unnoticed and with the captive space
continuing to grow, the government stands committed to providing the
resources needed to adequately monitor and support the sector.
With such a strong focus on captives, Cayman is certainly poised
for future growth. Yet, the government knows the attractiveness of
this jurisdiction rests in a well-rounded view of our stability. As global
standards continue to evolve, we stand committed to adapting our legal
and regulatory framework, as we have always done, to maintain an
environment conducive to international business.
In addition, many persons in the financial services sectors want and
appreciate good infrastructure, and Cayman certainly has that. We
know having quality service providers and good infrastructure builds the
confidence desired by the captive insurance sector, and indeed other
financial services sectors, in deciding to do business here.
To that end, Cayman is advancing several capital projects, such as
the redevelopment of our airport, the construction of a modern cruise
berthing facility, and the ongoing development of our road networks to
increase connectivity. I’m delighted to say that these capital projects will
certainly boost our business environment. They supplement our position
as a jurisdiction well- suited for all types of business, including captives.
Ultimately, the continued success of our financial services sector rests in a
collective approach to attracting business to these shores. Government firmly
believes that our business model presents a future that is bright for captives
and the jurisdiction. As we go forward together and target our objectives, as
always, we welcome input from you and other important stakeholders.
cayman captive 2019 9
Thanks to a sound regulatory and legislative framework that
supports a healthy business environment, the Cayman Islands
remains a leading jurisdiction in the captive insurance industry.
Credit for much of Cayman’s pre-eminence in this space rests
with the hardworking minds of the Insurance Managers Association of
Cayman (IMAC). From hosting the world’s largest gathering of captive
professionals for over 25 years, to better promoting the industry
internationally under its new brand, ‘Cayman International Insurance—
The Better Alternative’, IMAC has helped make Cayman a desirable
domicile for captives.
The numbers certainly bear out Cayman’s attractiveness in the captive
space. According to our financial services regulator, the Cayman Islands
Monetary Authority (CIMA), through the first two quarters of 2018 17
new licences were issued for captive insurance companies. With those
numbers as of June 30, 2018, Cayman could surpass its 2017 total of
33 new licences.
The captives sector is set for further growth. The current total of 698
class B, C and D insurance companies already eclipses the 2017 total
of 696 entities.
There are also encouraging statistics regarding the use of new licence
types. As of the second quarter of this year, there were 13 total portfolio
insurance companies (PICs) registered in the Cayman Islands.
While these are positive signs of the confidence clients place in the
Cayman Islands, we recognise that we are often targets for critics.
Contrary to news reports that portray Cayman’s financial services in
a negative light, the Cayman Islands responds positively to globally
practised regulatory standards, and has also entered into bilateral
regulatory agreements when they are in line with these standards.
We have done so for decades because we realise that the soundness
of our reputation is what allows our jurisdiction to do well commercially
in financial services, inclusive of the captive space.
As you might know, the Cayman Islands is currently involved in
discussions with the European Union regarding its assessment of third
country jurisdictions’ tax regimes. Cayman has underscored its position
through a robust engagement process with EU officials, stating our ongoing
work in good governance in the area of taxation and government’s plans
to enhance tax transparency and cooperation with the EU, as appropriate.
Throughout this process, the government has made sure the position
of captives has been taken into account by consulting extensively with
IMAC. In the face of the EU requirements being put forward, we highly