EU Removes the Cayman Islands from Annex I

The European Union ("EU") has affirmed that it considers the Cayman Islands to be a fully cooperative jurisdiction for tax purposes by removing it from its Annex I list of non-cooperative jurisdictions for tax purposes ("Annex I"). This follows a detailed technical assessment by the EU of various legislative measures brought in by the Cayman Islands in response to the Cayman Islands' commitments to the EU. The EU's satisfaction with these legislative measures was confirmed by the EU Finance Ministers comprising the Economic and Financial Affairs Council ("ECOFIN") on 6 October 2020.

In particular, the move recognises the Cayman Islands' compliance with the EU's requirement that the Cayman Islands put "appropriate measures in place relating to…collective investment vehicles". The Cayman Islands put those appropriate measures in place by passing private funds legislation earlier this year and registering over 12,300 private funds with the Cayman Islands Monetary Authority by 7 August 2020.

The EU's decision is a welcome recognition of the Cayman Islands as a jurisdiction which is fully committed to implementing international standards.

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