Mourant Ozannes
6 Experts
6 Contributions by Mourant Ozannes
PRACTICE NOTES
British Virgin Islands
English law/equity
Observed by the courts except where BVI statutes or case law provide otherwise.
Constitutional status
British Overseas Territory—self-governing within the Commonwealth.
Principal trusts legislation
Trustee Act 1961 (as amended) (Trustee Act)
Virgin Islands Special Trusts Act 2003 (VISTA)
Trustees’ Relief Act
Recognition of Trusts Act (Overseas Territories) Order 1987
Courts
Independent courts and judiciary, with the Privy Council as the ultimate appellate court; part of the Eastern Caribbean Court System.
Convention of 1 July 1985 on the Law Applicable to Trusts and on their Recognition (Hague Trusts Convention)
Its provisions are largely enacted, with many reinforced by BVI conflict-of-laws legislation.
Cayman Islands
English law/equity
Applied by the courts except where altered by Cayman Islands legislation or case law.
Constitutional status
British Overseas Territory—self-governing member of the Commonwealth.
Principal trusts legislation
Trusts Act (2021 Revision) (Trusts Act)
Banks and Trust Companies Act (2013 Revision)
Fraudulent Dispositions Act (1996
Private Client
PRACTICE NOTES
This Practice Note sets out an overview of the Cayman Islands in the context of offshore trusts. For general information on the Cayman Islands, see Practice Note: Private client—Cayman Islands—Q&A guide.
Government
The Cayman Islands is an autonomous British Overseas Territory, operating as a parliamentary democracy. It has a Governor, appointed by the Government of the United Kingdom. The Islands have their own Constitution, with the latest version taking effect on 6 November 2009, by which a Bill of Rights was brought into force as the ‘cornerstone of democracy’ in the Islands (see paragraph 1(1) of the Bill of Rights (Laws of the Cayman Islands)). The Constitution was amended in 2016 to, among other things, increase the retirement age for judges of the Grand Court and remove the Governor’s power to exercise disciplinary control over the Chief Justice and the President of the Court of
Private Client
PRACTICE NOTES
Most common types of trusts
Under Cayman Islands trust laws, a range of trusts can be established, including:
Discretionary trusts
STAR trusts
Life interest trusts
Fixed interest trusts
Charitable trusts
Exempted Trusts
Each of these trusts is outlined in more detail below.
Discretionary trusts
A discretionary trust usually delivers the highest degree of flexibility. It is the most commonly adopted format and is often the most effective arrangement for both the settlor and the beneficiaries. The trustee is granted extensive discretion over the timing, scale, and recipients of distributions from both income and capital. This structure is advantageous where, at the point the trust is created, the future circumstances of beneficiaries cannot be clearly defined and are expected to shift over time. Beneficiaries are not treated as holding any specific legal entitlement to a particular share of the trust fund, but instead have only the right to be considered when the trustee
Private Client
PRACTICE NOTES
Trusts laws of the Cayman Islands
The principal legislation regulating trusts in the Cayman Islands is the Trusts Act (2021 Revision) (the Trusts Act). That Act draws together several further enactments relevant to Cayman trusts, including, without limitation, the Special Trusts (Alternative Regime) Law 1997 and the Trust (Amendment) (Immediate effect and Reserved Powers) Law 1998, as well as other pertinent measures. See also The Rule on Perpetuities. It is important to recognise that Cayman Islands trusts law is rooted in English common law and equity, which continue to inform the interpretation and practical application of trust law in the Cayman Islands. Nevertheless, as the Cayman Islands’ trusts regime has developed over time, a series of statutory distinctions has arisen between the Cayman Islands and England, and therefore it should not be presumed that Cayman Islands trusts law will be applied in
Private Client
PRACTICE NOTES
A straightforward way to describe an offshore trust is one in which the trustees are based in a low- or zero-tax territory. Those with UK links include the Crown Dependencies—Jersey, Guernsey and the Isle of Man—and the Overseas Territories of Bermuda, the British Virgin Islands, the Turks and Caicos Islands, the Cayman Islands and Gibraltar (collectively the ‘CDOTs’). As a result, offshore trusts are frequently linked to potential tax efficiencies, though the personal tax circumstances of the settlor and any beneficiaries must also be taken into account. They can also confer benefits that are unrelated to tax planning.
Confidentiality and anonymity
At common law, trustees are obliged to keep the business of the trust confidential, a duty grounded in the general law on breach of confidence. Courts have examined this obligation in various decisions, commonly in the context of providing information to
Private Client
PRACTICE NOTES
A trust is a legal arrangement created either during life by gift or on death, where an individual (the settlor) passes assets to one or more people (the trustees) to hold for beneficiaries or for a defined purpose. Depending on the terms of the trust deed, the trustees may simply retain the assets until a future event occurs, or they may invest them so that the beneficiaries can receive value from the fund, typically as distributions of capital or as income generated by the investments. Benefits may arise on the happening of a condition or over time, according to the instrument. A trust therefore involves three roles: settlor, trustees and beneficiaries. It rests on equitable principles under which legal title to property is distinct from beneficial ownership, and the trustee owes a duty of care to the
Private Client
2 Contributions by Mourant Ozannes Experts
PRACTICE NOTES
This Practice Note examines the role of fixed charge receivers from a Jersey standpoint. As there is no fixed charge receivership process in Jersey, it focuses on how Jersey law interacts with English fixed charge receiverships in the circumstances below:
security granted by Jersey companies under English law over property located in England; and
security constituted under Jersey law over property located in Jersey
Security created by Jersey companies under English law over property situated in England
In broad terms, the Jersey courts will recognise a charge validly granted by a Jersey company over collateral outside Jersey where a non-Jersey governing law has been properly chosen, which is usually the law of the place where the collateral is located. However, certain aspects of a non-Jersey law charge created by a Jersey company remain governed by Jersey law, applying private
Restructuring & Insolvency
CHECKLISTS
The Checklist seeks to outline the principal actions that arbitrators should consider across the entire course of a proceeding, beginning with appointment and the first procedural order and ending with delivery of the award and completion of their obligations. It offers direction on the types of provisions that may feature in procedural orders addressing data security throughout the duration and lifespan of an arbitration. Please be mindful, in light of the evolving cybersecurity ecosystem and applicable laws and regulations, that this is not an exhaustive catalogue. Rather, the checklist functions as guidance on best practice and clarifies the considerations that may arise at each milestone.
Arbitration phase: pre-appointment of the Tribunal
Legal Steps
Safeguard your digital identity so you are seen as independent and impartial, notwithstanding the difficulties posed by an online presence. Refer to: Checklist for Arbitrators on the Use of Social Media and the Duty of
Arbitration
If you expected to see yourself on this page, click here.
