The Cayman Islands modernised its core company law this year. The Companies (Amendment) Act, 2024 came into force on 1 January 2026, and it makes several routine corporate actions faster, cheaper and more flexible. If you hold or are planning a Cayman exempted company, these are practical improvements worth knowing — not new burdens.
Court-free capital reductions for solvent companies
This is the headline change. Under the old rules, any reduction of a company's share capital required the approval of the Grand Court — slow and costly, regardless of whether the company was solvent. The amended Companies Act now lets a solvent company, where its articles permit, reduce its share capital by special resolution supported by a solvency statement from all its directors, confirming the company can pay its debts as they fall due. The resolution and statement are filed with the Registrar, who publishes a notice in the Gazette. The court-sanctioned route remains available where it is the right tool, but for most solvent reductions it is no longer necessary.
Redemption of fractional shares
Where their articles allow, companies may now repurchase or redeem fractional shares. It sounds technical, but it simplifies day-to-day operations for investment funds and listed companies that previously had to work around fractional entitlements.
New conversion routes without forming a new entity
A limited liability company (LLC) or a foundation company can now convert into an exempted company without incorporating a fresh legal entity, subject to meeting the statutory requirements and receiving a certificate of re-registration from the Registrar. Because an LLC's or foundation's constitutional documents differ from those of an exempted company, the entity updates its documents to fit — but it keeps its legal identity throughout. Separately, an exempted company can re-register as an ordinary resident company by special resolution, at which point its tax undertaking ceases.
Re-domiciliation into Cayman just got wider
The continuation regime — the route for moving a foreign company into Cayman without winding it up — has been broadened. Previously only a foreign company with limited liability and a share capital could continue in. Not every jurisdiction uses the concept of share capital, so that requirement blocked otherwise-eligible structures. Now a foreign body corporate with limited liability but without a share capital can also apply to continue into Cayman as an exempted company limited by shares. That opens the door to a wider range of international structures relocating to Cayman.
Greater certainty for local listings
For exempted companies issuing securities, the Act clarifies what counts as an offer to the "public in the Islands," excluding exempted companies, foreign-registered companies and LLCs from that definition. The effect is more certainty for entities considering a listing on a local exchange.
What it means for you
Taken together, these are pro-business, director-led reforms: routine group reorganisations, capital returns and relocations that once needed court time or a new entity can now be handled more directly. The trade-off is that the directors' solvency statement carries real weight — it must be accurate — so the reforms reward good record-keeping and proper process rather than replacing them.
How GERAI helps
GERAI provides Cayman company registration and ongoing statutory compliance — handling incorporations, continuations into Cayman, conversions and the filings that these corporate actions require. See our Cayman jurisdiction page for the full picture, and our guide to Cayman beneficial ownership in 2026 for the related compliance regime. We work on a compliance-first basis and do not provide nominee director/shareholder or company secretary services, or tax advice.
For the official position, see the Cayman Islands General Registry.
Related reading: BVI jurisdiction · Singapore jurisdiction · Hong Kong jurisdiction
This article is general information about regulatory developments, not legal or tax advice. Figures, fees and deadlines change and vary by entity type — confirm your own position with us or a qualified adviser before acting.