Private Client & Offshore Services updates


Contributed by Lennox Paton
Bahamian insolvency regime continues to promote judicial efficiency
  • Bahamas
  • 28 February 2019

The Bahamian legislature continues to examine its existing legislation for ways to promote judicial efficiency by amending and implementing new procedures in its insolvency regime. As the global economy continues to grow and foreign companies and investors increasingly face obstacles arising from the use of offshore structures, the need for cross-border insolvency proceedings and the use of protection afforded to investors will likely continue to increase.

Buying real estate – when to engage an attorney?
  • Bahamas
  • 21 February 2019

After finding the ideal property to purchase, what is the next step? Engage an attorney. An attorney can help to connect real estate buyers with key service providers in order to arrange, among other things, home inspections or insurance. Involving an attorney will make the difference between a smooth transaction that meets the expectations of the buyer versus one that is fraught with issues, unrealistic expectations and other obstacles which could have been avoided with the benefit of early advice and proper planning.

Foreign direct investment in real estate market
  • Bahamas
  • 14 February 2019

Foreign direct investment (FDI) remains one of the key catalysts to the Bahamian economy's growth and sustainability. The Bahamas National Investment Policy seeks to boost the economy through investments and provide favourable returns for investors. To this end, it encourages FDI in key areas in the real estate market, including tourist resorts, upscale condominiums, timeshares and second-homes and marinas.

Supreme Court evaluates scope of trustees' protection in contentious trust litigation
  • Bahamas
  • 09 August 2018

The Supreme Court recently assessed the protection afforded to trustees by virtue of Section 83 of the Trustee Act 1998, which provides that a trustee cannot be bound or compelled by way of discovery to disclose information and documents about a trust. In Dawson-Damer, a trustee had used Section 83(8) as a basis to refuse a disclosure request. The applicant's case was built primarily on the allegation of a breach of duty (ie, the trustee had failed to consider the applicant's needs).

Payment of preferential debts out of assets subject to floating charge not permitted
  • Bahamas
  • 26 October 2017

The Supreme Court recently considered whether preferential creditors have any claim against the moneys received by receiver-managers for the sale of assets subject to a charge. The court determined that a floating charge which crystallised before the making of a winding-up order takes priority over other creditors.


Contributed by Courtenay Coye LLP
The importance of legal advice for timeshare rights
  • Belize
  • 16 July 2015

The Supreme Court recently highlighted the need to comply strictly with essential legal requirements when investing in property abroad. It found that US citizens who had purchased timeshare interests in a residential resort could not exercise their purported rights in priority of a bank's mortgage interest on the property because they had not registered their timeshares or paid the required stamp duty.

Directors' indemnities foolproof
  • Belize
  • 16 April 2015

The Belize Court of Appeal recently confirmed that indemnities given by a Belizean company to its directors deprived the company of a cause of action to pursue a claim against former directors for decisions taken during their term as company directors. Belize continues to recognise blanket indemnities given by a company to directors as legal.

Appeal Court clarifies procedural law on claims against foreign defendants
  • Belize
  • 04 September 2014

The Belize Court of Appeal has provided guidance to litigants involved in multi-jurisdictional litigation. The court interpreted the rules applicable to commencing a claim against foreign defendants, and service of a claim form and interim injunction on parties outside the jurisdiction. Under the Civil Procedure Rules there is no need to obtain permission to issue a claim form for service abroad.

Enforcement of LCIA award refused as contrary to public policy
  • Belize
  • 22 May 2014

The Caribbean Court of Justice has addressed the issue of whether New York Convention Awards should be enforced. The case is exceptional and should be confined to its unusual facts. However, it stands as highly persuasive authority for the proposition that violations of the constitutional order by a government when affording tax concessions to investors may afford a defence to enforcement of an arbitral award.

Caribbean Court of Justice rules government must arbitrate under treaty
  • Belize
  • 08 August 2013

The Caribbean Court of Justice has delivered a landmark decision which narrows the circumstances in which a government may resort to its domestic courts to restrain international arbitration proceedings. The decision is an important victory for international investors in the Commonwealth Caribbean, since many bilateral investment treaties include clauses for resolution of disputes by international arbitration.


Contributed by Carey Olsen (Guernsey)
Round-up of recent trust cases
  • Bermuda
  • 14 March 2019

In 2018 the Bermuda courts issued several important decisions in trust cases. Moreover, the Trust Law Reform Committee of the Bermuda Business Development Agency remains active and has recently proposed further legislative reform. Among the committee's recent reform initiatives, the amendment to the Perpetuities and Accumulations Act 2009 by the Perpetuities and Accumulations Amendment Act 2015 has resulted in significant interest among international advisers and local practitioners.

Family office proposition – review of case law
  • Bermuda
  • 07 March 2019

Bermuda has historically flown beneath the radar when it comes to promoting itself as the ideal location for the establishment of a family office. However, the overall value of the trust business to Bermuda is significant, with hundreds of billions of trust assets under management on the island. New legal developments bode well for the family office sector and should help to make the Bermuda trust fit for purpose for the next generation of ultra-high-net-worth families.

Know your rights when made redundant
  • Bermuda
  • 28 February 2019

Bermuda's reinsurance market has not been immune to changes in the world's economic market. A rise in mergers and acquisitions has led to an increase in redundancies within the Bermuda workforce. Employees should be aware of their rights when made redundant and should always seek legal advice to ensure that their redundancy is both lawful and fair.

Update on Bermuda private trust companies
  • Bermuda
  • 31 January 2019

This article considers how recent changes to the regulation of financial services in Bermuda have affected private trust companies. Among other requirements, directors and administrators of private trust companies should determine whether they fall within the definition of an 'anti-money laundering/anti-terrorist financing regulated financial institution' and ensure that they comply with the new record-keeping requirements and pending beneficial ownership regime.

Jurisdiction of substance: Bermuda's economic substance laws
  • Bermuda
  • 17 January 2019

Many offshore financial centres, including Bermuda, laboured to meet the EU Council's end-of-year deadline to impose economic substance requirements on entities that carry on 'geographically mobile' business activities. For jurisdictions subject to the deadline, failure to introduce substance laws may result in being placed on the EU Council's list of non-cooperative jurisdictions for tax purposes. Bermuda's substance laws ensure that the country maintains its stellar reputation as an international financial centre.

British Virgin Islands

Contributed by Harneys
Commercial Court provides welcome guidance on Norwich Pharmacal relief in aid of foreign proceedings
  • British Virgin Islands
  • 21 March 2019

In a recent ex tempore judgment, the BVI Commercial Court's power to grant Norwich Pharmacal disclosure orders in support of foreign proceedings was clarified. The judgment was given on a successful application for Norwich Pharmacal relief to assist Brazilian clients in bringing claims for the recovery of misappropriated assets. The decision confirms the British Virgin Islands as a particularly helpful jurisdiction in the fight against international fraud and the recovery of misappropriated assets.

This is not a wind up: BVI court approves restructuring provisional liquidation
  • British Virgin Islands
  • 14 March 2019

In a major development in BVI insolvency law and practice, the Commercial Court recently held that provisional liquidation is available to facilitate a restructuring. The objective of a restructuring provisional liquidation is to provide a better outcome for creditors than would be likely on a winding up. The Commercial Court's decision will certainly influence the current debate in the British Virgin Islands regarding insolvency legislation reforms.

Reverse engineering: Court of Appeal in rare reversal of findings of fact
  • British Virgin Islands
  • 29 November 2018

The BVI Court of Appeal recently considered the scope of its jurisdiction to interfere with findings of fact made at first instance. This is the second time in 2018 that the court has addressed this issue. While the threshold for intervention is high, the court will intervene on appropriate occasions. The thoroughness of the evaluation of evidence and the credibility of the judge's conclusions at first instance are likely to be pivotal to that determination.

Receivers – gateway to unlocking disabled bearer shares
  • British Virgin Islands
  • 08 November 2018

In two recent BVI Court of Appeal decisions, disabled bearer shareholders were found to have a constitutional right not to be deprived of their property without compensation. It is now abundantly clear that even where BVI disabled bearer share companies are still without functionaries (ie, directors) to facilitate the traditional redemption of those shares, the court has flexible jurisdiction to appoint receivers to redeem those disabled shares, thereby ultimately restoring the companies to a functional state.

Are you wearing the right hat? Directors' duties revisited by Court of Appeal
  • British Virgin Islands
  • 25 October 2018

The Court of Appeal judgment in Antow Holdings Limited v Best Nation Investments Limited continues the development of the law regarding BVI directors' duties following the Independent Asset Management appeal, which established – for the first time in the British Virgin Islands – clear guidance regarding the proper purpose test. The decision is arguably at the extreme end of the spectrum, with the court describing the motives of the Best Nation directors as self-serving.

Cayman Islands

Contributed by Ogier
Court of Appeal overturns anti-suit injunction in favour of Argyle Funds SPC Inc
  • Cayman Islands
  • 31 January 2019

The Court of Appeal has unanimously allowed every ground of an appeal by the liquidators of Argyle Funds SPC Inc. The key takeaway for the Cayman Islands professional services industry is that where work is delegated to be carried out by related entities outside the Cayman Islands, any attempt to contractually limit clients' rights to bring claims against those entities must be expressly articulated within the contract.

Capital call facilities – LPA and side letter review
  • Cayman Islands
  • 10 January 2019

Along with the growth and maturity of the fund finance market, funds and their counsel have become increasingly familiar with lenders' limited partnership agreement (LPA) requirements. Therefore, newer LPAs often include the provisions that lenders require in order to provide financing under a capital call facility. Lenders and their counsel should consider several key due diligence points when reviewing LPAs, investor subscription documents and related side letters.

Astral projections: Cayman Islands STAR trusts
  • Cayman Islands
  • 06 December 2018

The Special Trusts (Alternative Regime) (STAR) Law introduced so-called 'STAR trusts' into Cayman Islands law to overcome some of the difficulties arising from more conventional offshore trusts. One of the most challenging aspects of establishing a STAR trust is the drafting of the purposes for which it is established. While the STAR Law contains rules to prevent STAR trusts from failing (eg, failure resulting from object and beneficiary uncertainty), there are a number of traps for the unwary.

Cayman Islands foundation companies at a glance
  • Cayman Islands
  • 25 October 2018

Foundation companies are a unique structuring option in the Cayman Islands for wealth planning and also serve as holding and special purpose vehicles for commercial transactions and cryptocurrency offerings. Although a foundation company may be used as an alternative to a Cayman trust, a number of features specific to Cayman trust law have been incorporated into the foundation company vehicle which should prove beneficial to investors and private clients.

Structuring ICOs in the Cayman Islands
  • Cayman Islands
  • 18 October 2018

The Cayman Islands has become a popular choice for many businesses conducting initial coin offerings (ICOs) due to its tax neutrality, its reputation as a pre-eminent jurisdiction for investment funds and its securities law regime, which is generally more permissive than those of other jurisdictions. However, before any steps towards conducting an ICO are taken, it is critical that comprehensive legal and tax advice is obtained for each business before any token is sold or any entity is formed.