New Cayman Islands Trusts Law Revision

I realize that not all readers will have reason to venture into the law of trusts outside Canada. I also realize that the use of offshore trust almost automatically sounds an alarm. However, there are indeed quite valid reasons for employing the different sorts of approaches that are available in these finance-focussed jurisdictions. Beyond that, litigators may well wish to keep up to date just to keep  a “feel” for trusts law in more complex, trans-national contexts.

On May 31, 2017, the Cayman Islands Trust Law (2017 Revision) came into force. The last revision was in 2011. One point of interest is in respect of “STAR trusts”, which are essentially statutory trusts for purposes charitable and private. These sorts of trusts are not subject to the normal perpetuities rules (150 years in the Cayman Islands) and allow for an “Enforcer” to be appointed within the instrument to enforce the Trust (in addition to the Court). To qualify, one of the trustees must be a Cayman licensed trust company, a Cayman Private Trust Company or a controlled subsidiary. One can appreciate that these well extend the duration of Family Trusts than in domestic law and, coupled with the statutory protections in the Cayman Islands respecting confidentiality of trust-related information, these are quite powerful devices. More information on the trusts law of the Cayman Islands’ trust law can be found at Cayman Finance.

News source: Hull & Hull LP