The Cayman Islands’ Position on Beneficial Ownership

The Cayman Islands looks forward to continued, reasonable cooperation with the UK on beneficial ownership transparency; and to introducing robust access to beneficial ownership information, based on legitimate interest protocols that align with evolving global standards and our constitutional obligations.

This position was affirmed by the Cayman Islands Government during the annual UK Joint Ministerial Council, held this year from 20-21 November. The Hon. Premier and Minister for Financial Services and Commerce, the Hon. Juliana O’Connor-Connolly, led the Government delegation.

Introducing legitimate interest protocols recognises that access to beneficial ownership information now extends beyond law enforcement to certain members of the public, based on the 2022 EU Court judgment (Sovim v Luxembourg). This judgment balances transparency with privacy rights, by requiring access to beneficial ownership information only where there is a “legitimate interest”. The judgment therefore is an important guide to access based on legitimate interest.

“While there is currently no recognised global standard for legitimate interest access (LIA), it is prudent that we carefully balance transparency with privacy rights, while taking the necessary steps to introduce LIA in relevant money laundering and sanctions legislation,” the Premier said.

In keeping pace with these and other global developments, over the past few years the Cayman Islands has invested significant time, effort and expense to develop and implement our new Beneficial Ownership Transparency Act. The Act, which aligns with current global standards, consolidates all the Cayman Islands’ previous beneficial ownership legislation. It also fosters compliance through our multilayered robust verification requirements, which are intended to ensure high-quality beneficial ownership information.

More broadly, the Act augments our reputation for international cooperation by providing rapid, unfettered access to our law enforcement agencies and competent authorities. Access is also provided to government agencies, including those involved in public procurement, licensed financial institutions, and regulated designated non-financial businesses and professions. It also assists us with preparations for the Cayman Islands’ 5th round mutual evaluation under the Financial Action Task Force (FATF), which sets the global standard for beneficial ownership transparency.

As part of our beneficial ownership framework, The Beneficial Ownership (Access Restriction) Regulations, 2024, received Cabinet approval on 14 November and are expected to be published and enacted on 9 December. These regulations are the legal framework for protecting persons for whom disclosing their beneficial ownership information to the public would establish a threat of serious harm.

With regard to LIA, The Beneficial Ownership (Legitimate Interest Access) Regulations, 2024, are expected to be considered by Cabinet shortly. These regulations will set the legal framework that permits certain members of the public to access beneficial ownership information, once they have demonstrated a legitimate interest for doing so.