CIFSA welcomes changes to Cayman insolvency legislation
The insolvency legislation in the Cayman Islands is planned to be changed soon. These changes to the legislation include the licensing of practitioners and measures used to help with cross-border insolvencies. The above-mentioned changes have been welcomed by the Cayman Islands Financial Services Association (CIFSA).
The changes are to be implemented within the next 6 months. A new Insolvency Rules Committee is developing a framework of rules and regulations in order to give practical effect to the changes, which will improve an already successful formula.
David Roberts, a director of CIFSA, observed that the Cayman Islands is well-known and respected for the strength of its insolvency framework and it provides commercial certainty, transparency and protection for the needs and rights of investors and creditors. According to him, “these changes will only serve to increase Cayman’s reputation as a modern and effective financial centre, ideally suited to working through the complexities of major cross-border insolvencies”.
Also, the new framework provides for disciplinary action against practitioners who act improperly. Foreign receivers and liquidators are given the power to recover assets in Cayman, in line with the legislation in the UK and the US recognizing Cayman liquidators.
Bryan Hunter, CIFSA director, commented that there is no doubt that Cayman’s insolvency regime is equally friendly to investors and creditors, and no special favours are offered to the management of companies that are liquidated in the Cayman Islands.
Cayman Islands liquidators will also be entitled to administer foreign companies based and conducting business in the jurisdiction.