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28 May 2020
The government has restricted entry to the Cayman Islands since mid-March 2020 and is currently operating a curfew system day and night for residents other than essential workers, with the exception of exercise or essential trips such as to the supermarket or for medical reasons.
The financial services sector has adapted well to the new restrictions and continues to operate effectively through the use of electronic filing and payment systems. Court hearings are conducted by video link using electronic bundles, with multiple parties able to participate just as they did before the restrictions, and with court staff working hard in the background to ensure that the administrative requirements are met. Government finance bodies are also functioning remotely, although there are some exemptions to the curfew for essential workers.
On 31 March 2020 a virtual meeting was held between the heads and delegates of financial services industry associations in Cayman to allow the government to engage with them directly on various business continuity plans relating to the financial services industry. It is hoped that any chosen actions will be taken swiftly, consistent with the government's stated desire of assisting users of the financial products that the jurisdiction offers.
The following measures are either in the process of implementation or anticipated in the near future.
Many small businesses in Cayman, particularly those in the tourism industry, are expected to struggle during the coming months. In anticipation of a continued lockdown, the government is implementing a CI$14.5 million support plan for small and microbusinesses impacted by COVID-19.
The plan includes a loan programme that will require no repayment on principal or interest within the first six months and a grant programme to help businesses survive the loss of revenue in the coming months.
The government has implemented a number of measures to assist with the administrative challenges faced by the financial services industry, including:
The government is considering legislation aimed at facilitating the restructuring of Cayman entities operating overseas.
Many consider this to be an opportunity for the government to introduce practical assistance in the form of an automatic stay at the point that entities file for the appointment of a restructuring professional (rather than from the date of appointment), provided that appropriate safeguards exist for the interests of creditors.
Other expected areas of reform include the ability to recognise and directly enforce foreign plans of reorganisation, such as those put together under Chapter 11 of the US Bankruptcy Code, and the ability for companies to pass a resolution to appoint restructuring officers without first obtaining a resolution of their shareholders.
For further information on this topic please contact James Heinicke or Marc Kish at Ogier by telephone (+852 3656 6000) or email (email@example.com or firstname.lastname@example.org). The Ogier website can be accessed at www.ogier.com.
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