Limited Liability Company
Where the proposed activities of a company are to be carried out mainly outside of the Cayman Islands – offshore – the registrants can apply for registration as a Limited Liability Company (“LLC”) under the Limited Liability Companies Law. Like companies under the Companies Law, this type of company has separate legal identity therefore the members of the company cannot be held personally liable for the company’s debts or liabilities.
Unlike Companies under the Companies Law, an LLC has no share capital but members acquire LLC interest. The management of an LLC rests with its members and/or managers.
The formation of an LLC is similar to the process of forming a Cayman Islands exempted limited partnership. The filing of a signed registration statement containing certain prescribed information and payment of the registration fee is required in order to register an LLC with the Registrar of Limited Liability Companies. When a change occurs in any matter specified in an LLC’s Registration Statement, the LLC must file a certificate of amendment to the Registration Statement.
The LLC Law makes provision for an existing Cayman Islands exempted company to merge with, consolidate with or convert to an LLC and permits non-Cayman Islands entities to re-register and continue into the Cayman Islands as a LLC.
In January of each year, the company must file with the Registrar a return certifying that during the previous calendar year it has complied with the provisions of the LLC Law and pay to the Registrar a prescribed annual fee.
The most convenient way to incorporate this type of company in the Cayman Islands is to engage one of the professional firms licensed for this purpose. These firms can provide such services as: registered office; nominee shareholders; directors and other officers; and management of the company on the instruction of the beneficial owner(s)