HSM LAW
HSM Celebrates Another Gold-Winning Year at Best of Cayman 2026
The HSM Group is proud to announce its outstanding success in the 2026 Best of Cayman Islands awards, achieving Gold medals across multiple categories: Law Firm Immigration Law Estate Law Corporate Services The Best of Cayman Islands is a vote-based Read more +
HSM Welcomes Three Interns to 2026 Summer Internship Programme
68 Fort Street, Grand Cayman (27 July 2026): The HSM Group is proud to continue its summer internship programme with three young professionals: Dimitri Seymour (Corporate/Compliance), Diego McLaughlin (Intellectual Property) and Alicia Allen (Intellectual Property). HSM’s Summer Internship Programme commenced Read more +
Trump v Barbara: Why Birthright Citizenship Still Matters in Cayman
A U.S. case with a Cayman history behind it At first glance, Trump v Barbara looks like a purely American case. It concerns President Trump’s attempt to restrict birthright citizenship under the United States Fourteenth Amendment. Cayman does not have Read more +
Cayman Islands Immigration Update – June 2026: An Act of Unintended Consequences, New Work Permit Conditions and Statistics
When the Cayman Islands Government proposed changes to the Immigration Law, released last year, there was one change that stood out and that was the proposed changes to Section 64 of the Immigration (Transition) Act (2022 Revision). This was the Read more +
A Look into Cayman’s Proposed New Rule on the Deregistration of Private Trust Companies
On 17 August 2020, the Cayman Islands Monetary Authority (“CIMA”) wrote to the heads of several private sector associations in the Cayman Islands, including the Cayman Islands chapter of the Society of Trust and Estate Practitioners (“STEP”) seeking their views regarding a proposal to introduce a new rule which would require Cayman Islands private trust companies (“PTC’s”) to inform CIMA if they intend to cease conducting ‘trust business’ (as defined in the Banks and Trust Companies Law (2020 Revision)), and to enable CIMA to de-register any PTC that they deem to be in breach of Anti-Money Laundering Regulations or in circumstances where the directors and officers of any PTC cease to be ‘fit and proper persons’ (as defined in the Banks and Trust Companies Law (2020 Revision) (the “New Rule”).
By way of background PTC’s are permitted to act as a corporate trustee for one or more CIMA approved family connected trusts and they cannot offer their services to the general public in competition with commercial trust corporations.
HSM is at the forefront of this process as Robert Mack sits on the STEP Legislative Reform Sub-Committee and is working to provide commentary on the proposal during the prescribed consultation period.
The nub of the problem lies in the fact that while every PTC must seek the prior approval of CIMA to conduct ‘trust business’ in the Cayman Islands and to be granted PTC status prior to assuming any trusteeships, however, there is currently no mechanism to de-register a PTC if it wishes to cease conducting ‘trust business’ for whatever reason.
In addition, there is no de-registration sanction which CIMA can impose where a PTC is in breach of Anti-Money Laundering Regulations or where the persons controlling the PTC cease to be ‘fit and proper persons’ in the opinion of CIMA. The New Rule, if implemented, will allow PTC’s to be deregistered either by their own volition or by CIMA acting independently with a view to maintain compliance with Cayman Islands laws and regulations.
A PTC wishing to de-register under the New Rule will be required to submit an application to CIMA within 21 days of ceasing to carry on ‘trust business’, and such application must be supported with a License Termination/Surrender/Deregistration Form, a resolution signed by at least two directors of the PTC indicating on what date the PTC ceased carrying on ‘trust business’, together with a declaration signed by at least two directors of the PTC confirming that (1) all clients have been informed of the de-registration (2) all outstanding liabilities of the PTC have been settled (3) all outstanding complaints (if any) against the PTC have been resolved, (4) there are no pending or threatened legal proceedings against the PTC, and (5) the PTC is not acting as trustee of any trusts.
The New Rule, if implemented, should further enhance the reputation of the Cayman Islands as a well-regulated financial centre and place the jurisdiction on par with other competing onshore and offshore centres. Also, it will create a clear procedure for PTC’s wishing to voluntarily deregister and will further enhance the powers of CIMA to oversee and regulate PTC’s and is therefore a welcome enhancement to the regulatory regime of the Cayman Islands.
