Planning on creating investment funds in the Caymans? If so, then you should know that doing so requires being up to date on the recent developments in the structure of offshore funds in the this jurisdiction. It also takes being aware of how those changes are affecting investor-manager relations.
Considering establishing investment funds in the Caymans? Need legal advice on regulatory framework in the Caymans? IQ Decision UK is at your service.
There’s a number of trends affecting investor-manager relations. Let’s look at some of the most important ones:
- Pressure from investors to include an MFN clause. This results in investors being able to take advantage of any improved & agreed upon conditions. Including such a clause will mean that investors & managers will be required to provide such conditions for existing investors.
- Conclusion of agreements on partial or full reimbursement of management fees with major investors. In a limited number of cases, investors considering investing in offshore funds in the Caymans can successfully agree on a percentage share in a general partnership.
- Attracting major investors through offering stocks of the base or primary class. Thanks to that, favorable conditions are provided to individual investors.
- Negotiating a preferential offer whereby a joint approach to business management is worked out.
- Independent management. It can take various forms but can be eliminated due to direct representation of the investor fund or representation at the general partner level.
- A notable increase in the number of director or advisory boards created at the fixed asset level. This results in additional level of comfort of investors seeking to invest in offshore funds in the Caymans.
- Increased duration & depth of audits at the stage of establishing investment funds.
- Increasingly more instructions from investors. This is necessary for conducting detailed analysis of legal & constituent documentation before investing.
Need legal help with registering offshore funds in the Caymans? IQ Decision UK is the answer.
Protection of Investors
Over the past years, the Caymans have been been trying hard to meet growing expectations of the investor & manager community. Following the introduction of AML legislation, its reputation with investors, which up to that moment was already rock-solid, has grown dramatically.
Thus, investors can have peace of mind knowing that they will always be provided with creative solutions that will protect their interests during negotiations
It is hard to say with absolute certainty how investor-manager relations will be developing in the years to come. However, one thing is clear now: managers are going to be increasingly relying on lawyers & service providers for innovative solutions enabling them to adapt to changing conditions.
Thinking about establishing investment funds in the Caymans? IQ Decision UK can give you legal help with registering investment funds in the Caymans or any other jurisdiction of your choice.