Permissions

1. Broker Dealer: Buying, selling, subscribing for or underwriting securities as an agent;
2. Market Maker: Buying, selling, subscribing for or underwriting securities as principal;
3. Securities Arranger: Arranging Deals in Securities
   • another person (whether as a principal or an agent) buying, selling, subscribing for or underwriting securities; or
   • a person who participates in the arrangements buying, selling, subscribing for or underwriting securities;
4. Securities Investment Manager: Managing securities belonging to another person in circumstances involving the exercise of discretion;
5. Securities Investment Advisor: Advising a person on securities if the advice is:
   • given to the person in his capacity as an investor or potential
6. Investor or in his capacity as agent for an investor or a potential investor; and
   • advice on the merits of his doing any of the following (whether as principal or agent):
   • buying, selling, subscribing for or underwriting a particular security; or
   • exercising any right conferred by a security to buy, sell, subscribe for, underwrite a security.

Capital Requirement

Minimum paid-up capital of at least CID 100,000

Neither the SIB Law nor CIMA requires a SIB licensee to maintain a direct physical presence in the Cayman Islands, so all functions could be delegated.

• Records to be kept at the registered office

However, the Company will be required to maintain at its registered office electronic copies of all procedural manuals, contractual agreements, insurance information, due diligence information, client correspondence, and client transaction information to be available for inspection by CIMA at any time upon reasonable notice.

A registered firm shall at all times maintain insurance policies in an amount appropriate to the complexity, size and nature of the securities business of the firm to cover at least professional indemnity.

Registration will not be granted should the Commission thinks that the coverage amount is insufficient.

However, this requirement does not apply to firms engaging exclusively in advising on securities.

Desfran shall seek to understand your business activities and goals to assist with your business plan drafting that best encompasses this whilst still being compliant with the prevailing regulations. Desfran shall also advise on the possible questions that might be posed by the regulator.

Filing and Reporting Requirements

1. Audited Accounts annually, within six months of the licensee’s financial year end, as required in Section 13 of the Securities Investment Business Act (SIBL);
2. A Certificate of Compliance certifying that the licensee has complied with the provisions of the act and any underlying regulations. This must be submitted at the same time as the audited accounts (as required by Section 13, SIBL);
3. Notification of any changes in the information required at the time of licensing, within seven days of such changes occurring (required under Section 7(4), SIBL).
4. Auditor’s opinion on the internal controls of the licensee, at the same time as the audited accounts, as required in section 8(1) of the Securities Investment Business (Financial Requirements and Standards) Regulations 2003;
5. Financial reporting statements – In the case of a licenced Broker-Dealer, a monthly statement, and, in the case of all other licenced entities, a quarterly statement. Licensees must submit these within 15 business days of the end of the month or quarter (Section 8(1), SIBL (Financial Requirements and Standards) Regulations;
6. Annual reconciliation between balance sheet figures on the audited accounts and monthly/quarterly reporting statement prepared at the same date, and an explanation of any differences, and at the same time as the audited accounts, as required under the same section;
7. Current Details of Insurance annually, prior to renewal of the licensee’s securities investment business licence, as specified in Section 4(2) of the Securities Investment Business (Conduct of Business) Regulations (the Conduct of Business Regulations);
8. Other Notification – Licensees should also be familiar with, and adhere to, the notification requirements under Section 9 of the Conduct of Business Regulations.

Leverage

Maximum leverage of 1:500

Due Diligence is necessary to formally verify the identity of all clients of the firm. The following documents are required to conduct due diligence for the license application:

• A copy of the photo page of the passport ceritifed by a notary public for each director and shareholder;
• A copy of proof of address (issued within the last 3 months) by a notary public for each director and shareholder;
• Curriculum Vitae (CV);
• Business Plan;
• Financial Forecast;
• Organisation Chart;
• For company directorship or shareholdership, a certified copy of the constitution documents of the company and above details on each director and shareholder of the company;
• Other supporting documents when necessary.

Please note for a company listed on a major stock exchange or subject to regulatory supervision in a country with equivalent AML regulations to the Cayman Islands, evidence of such listing or regulation will suffice in place of the above information. Where the directors to be appointed are employees of such a listed or regulated company, a certified passport copy and confirmation of employment (to include position) will suffice.

Licensed Registration

• Company manuals for internal and external procedures
• Compliance procedures
• Fit and Proper test details
• Company Business Plan
• Securities Private Placement offering or prospectus

Bank Account Opening

• Certificate of Incorporation
• Articles of Memorandum and Association
• Certificate of Good Standing (If Company is older than 1 year)
• Resolution of Directors and Officers
• Copy of Share Certificates
• Other required supporting documents from the bank

Under the Monetary Authority Act, the Cayman Islands Monetary Authority (CIMA) began operations on 1 January 1997 and was created by the Cayman Islands Government to regulate and supervise the Cayman Islands’ financial services industry.

It is also responsible for enhancing Cayman’s ability to maintain a well-regulated financial services regime and monetary stability. CIMA was created from the merger of the Financial Services Supervision Department of the Cayman Islands Government and the Cayman Islands Currency Board and assumed the former responsibilities, duties and activities of these two bodies.

Since then, CIMA has taken on additional responsibilities and, through ongoing legislative changes, has been given more clearly defined functions, duties, powers and obligations, thus enhancing our ability to meet international standards as well as ensuring our accountability and transparency.