Types of Companies in the Cayman Islands

The Cayman Islands have long been a magnet for global entrepreneurs, fund managers, and international businesses — and it's easy to see why. A stable legal system, modern financial infrastructure, and a trusted regulatory environment make Cayman one of the most reliable jurisdictions for international structuring.

This updated guide walks you through the main company types available in the Cayman Islands, what they’re used for, and the compliance points you should know before setting up.

Why So Many Businesses Choose the Cayman Islands

Today, the Cayman Islands have over 100,000 registered companies, supported by a legal framework based on English common law.

Unlike many other jurisdictions, Cayman doesn’t impose corporate income tax, capital gains tax, withholding tax, or estate/inheritance taxes. Instead, government revenue comes from fees and duties — making Cayman tax neutral, not a tax-evasion haven.

Regulation is handled by the Cayman Islands Monetary Authority (CIMA), which follows international standards from the OECD, FATF, and EU.

Official Reference – Cayman Islands Monetary Authority (CIMA)

Whether you’re creating a fund, a holding structure, or a global operating entity, Cayman offers a straightforward, reputable environment.

Main Types of Companies in the Cayman Islands

1. Exempted Companies

This is the structure most international businesses choose. Exempted companies are meant for operations conducted outside the Cayman Islands.

Why companies choose this structure

• No requirement to hold meetings in Cayman

• Shareholders stay private (not publicly listed)

• Director names are filed and publicly searchable, though only basic details are visible

• Eligibility for a 20-year tax-exemption undertaking

• No residency requirements for directors or shareholders

Common uses

• Investment funds

• Holding companies

• International trading or licensing

• Structured finance SPVs

2. Ordinary Companies

These are mainly used by businesses that want to operate within Cayman.

Ordinary Resident Company

• Allowed to conduct local business

• Requires a Trade & Business Licence

• Must keep a public register of members

Ordinary Non-Resident Company

• Mainly operates outside Cayman

• Must confirm it does not conduct local trade

• Lighter regulatory obligations than resident companies

3. Limited Liability Companies (LLCs)

A Cayman LLC is inspired by the US LLC model but adapted to Cayman’s legal environment.

What makes LLCs appealing

• Members enjoy limited liability

• Structure and economic rights are fully customizable

• Managed by an LLC Agreement (not publicly filed)

• Uses membership interests, not shares

Where LLCs are commonly used

• Joint ventures

• Asset-holding structures

• Alternative investment vehicles

• Cross-border financing setups

4. Segregated Portfolio Companies (SPCs)

If you need multiple “sub-entities” under one company — each with its own ring-fenced assets — an SPC is ideal.

Key advantages

• Each portfolio’s assets and liabilities are legally separated

• Perfect for insurance platforms and multi-fund structures

• Only one legal entity to maintain, but many portfolios to operate

5. Foundation Companies

Foundation companies sit somewhere between a trust and a corporation.

Why they are becoming popular

• They can operate with or without members, making them suitable as “orphan” structures

• Used for beneficiary-driven or purpose-driven arrangements

• Helpful for philanthropy, succession planning, and increasingly, Web3 and DAO governance

How to Set Up a Company in Cayman

Setting up a company here is straightforward, especially when done through a licensed corporate service provider. The usual steps include:

1. Choosing a company type based on your goals

2. Name approval through the Cayman General Registry

   Official Reference – Cayman Islands General Registry

3. Preparing the constitutional documents

4. Appointing directors, managers, or members

5. Filing incorporation documents

6. Completing AML/KYC — ID, address proof, and source of funds if required

7. Opening a corporate bank account

8. Applying for licenses (only if doing regulated or local business)

Essential Compliance Requirements (2025 Updated)

Economic Substance (ES)

Every Cayman entity must file an Economic Substance Notification (ESN) each year.

Entities engaged in “Relevant Activities” — such as fund management, finance/lease, headquarters business, distribution & logistics, or IP business — must meet the ES Test and submit annual ES returns.

Beneficial Ownership (BO)

Most companies must maintain a Beneficial Ownership Register under Cayman law.

Under the Beneficial Ownership Transparency Act 2023, the rules have been modernized:

• BO info must be filed with authorities

• Information is not public, maintaining appropriate privacy

This ensures Cayman remains compliant with global transparency standards while protecting sensitive business information.

Benefits of Cayman Incorporation

✔ Tax Neutrality

You won’t face corporate, income, capital-gains, or withholding taxes.

✔ Balanced Privacy

• Shareholders remain private

• Only director names are public

• Beneficial ownership info is kept confidential (authorities only)

✔ Straightforward Operations

• Fast incorporations

• Flexible management

• No FX controls

✔ Strong Global Reputation

Cayman is widely trusted for its regulatory sophistication and legal stability.

✔ Deep Professional Expertise

The jurisdiction is home to world-class legal, accounting, and fund administration professionals.

Industry Snapshot

• Cayman remains the leading fund domicile globally, representing over half of all SEC-reported hedge fund net assets.

• It is consistently ranked as one of the top international (offshore) financial centers in the Latin America & Caribbean region.

• Cayman entities hold trillions in cross-border financial assets, underscoring its importance in global finance.

Why Work With Mirr Asia

Mirr Asia supports clients from Cayman company formation to ongoing compliance:

• Fast and compliant company setup

• Guidance on ES, BO, AML/KYC

• Bank account support

• Annual renewals and corporate maintenance

Whether you’re building an investment structure, managing assets, or expanding internationally, Mirr Asia ensures a smooth and compliant setup in the Cayman Islands.