HLX SUBSTANCE
The OECD has required all offshore jurisdictions to introduce Economic Substance laws that require certain minimum levels of activity to be taking place within the offshore company or structure in order to be compliant from a global tax perspective.
Cayman has created rules and regulations (visit the DITC Site) that set out the framework within which all companies in Cayman must operate in order to be compliant with these rules.
Some companies may consider it sensible to scale back their offshore operations as the cost of complying with the Economic Substance rules may outweigh the benefits. For others however, it may be an opportunity to base certain critical functions in Cayman and thereby comply comprehensively with the legislation. Legal advice should be sought in order to properly understand the factors and risks at work in your individual circumstances.
We stand ready to assist those entities that need, want or elect to operate under the Economic Substance obligations. Our team of investment, risk, technology, accounting, trading and legal professionals are available to provide the necessary infrastructure, support and activity to comply with the obligations of your business. If you wish to learn more, please do contact us.
Investment Substance by hlx
Establishing an investment management company is a complicated and costly undertaking. HLX can help simplify this for you by offering a hosted investment-risk-management solution for your business. Our firm can be appointed as investment manager and then delegate portfolio management decisions down to your local operation, retaining, in the Cayman Islands, risk management, trading or any other desired investment element.
Our business is registered with the Cayman Islands Monetary Authority as a Registered Person as well as with the SEC as an Exempt Reporting Adviser. We work with a multitude of investment companies where we are appointed, in ‘EU parlance’ the Alternative Investment Fund Manager (“AIFM”) thus allowing you to focus on investment research and portfolio construction while we perform risk management, trade execution or other ancillary services.
We have prepared an illustration of how our services can seamlessly fit in with your business, but this is a complex area and we recommend we plan a call to discuss your unique circumstances.
This chart contains lots of detail on first glance but in essence our business or our people can sit in your business or alongside your business in the investment process to provide activity and substance in Cayman. This typically involves risk management or trading but other options are available. Please do contact us to discuss in more detail.
Illustrative Structure of a Cayman-hosted Investment Manager Solution
