Cayman Islands: Market conduct guidelines for trust and corporate services providers and company managers
On 22 May 2024, the Cayman Islands Monetary Authority (CIMA) published to the official gazette the "Rule and Statement of Guidance" for Trust and Corporate Services Providers (TCSPs) and Company Managers. These guidelines ensure fair client treatment and asset protection within the company management and trust business sectors.
This document outlines CIMA’s market conduct rules and guidance for TCSPs and Company Managers and aligns with the Banks and Trust Companies Act (BTCA), the Companies Management Act (CMA), and other relevant regulations.
The guidance sets minimum requirements for TCSPs and Company Managers to ensure fair client treatment and protection of assets. These rules are binding and outline CIMA’s expectations for market conduct, without being exhaustive or overly prescriptive.
The guidelines apply to holders of Trust Licenses, Restricted Trust Licenses, Nominee Trust Licenses, Companies Management Licenses, and Corporate Services Licenses under the BTCA and CMA.
Compliance will be assessed proportionally to the size, complexity, and risk profile of operations. Entities may rely on group-wide market conduct frameworks if they meet legal requirements.
Key principles
Integrity
- Conduct business honestly and with integrity
- Maintain clear communication records
- Avoid unethical practices and prioritise client confidentiality
- Provide fair treatment and appropriate advice
Client money and assets
- Administer and safeguard client money carefully
- Avoid holding client funds in sanctioned entities or shell banks
- Promptly reconcile client accounts and protect their assets
Resources
- Maintain adequate policies and resources to fulfil client service agreements
- Properly manage delegations of duties and comply with relevant laws
Advertising and communication
- Ensure clear, factual, and ethical communication
- Disclose risks and provide accurate information
- Use plain language to inform clients about risks, fees, and terms
Terms of business
- Document written terms of business with clients
- Describe services, fees, complaint procedures, and termination terms clearly
Complaints handling
- Establish effective complaints handling procedures.
- Maintain a comprehensive log of complaints and ensure timely acknowledgement and resolution.
- Regularly analyse complaint patterns to identify and address systemic issues.
- Analyse patterns to address systemic issues and keep complainants informed
Following these guidelines ensures compliance with CIMA’s regulations, promoting transparency, fairness, and ethics in the Cayman Islands business environment.
The guidance will come into force in November and can be found here.
