Legal Aspects Related to Funds - Protected Cell

Companies/Incorporated Cell Companies

Jersey | Guernsey | London | Dublin | Geneva

Simon Pascoe, PartnerBedell Group

Introduction

■ Companies (Jersey) Law

■ Protected Cell Companies

■ Incorporated Cell Companies

■ Uses

Content

■ Key features

■ Structure

■ Advantages

■ Practical issues

■ Comparisons with other jurisdictions

Key Features

■ Separate legal personality?

■ Importance of name

■ Segregation of assets and liabilities

■ Recourse of creditors

■ Taxation

Structure

■ Formation

■ Memorandum and Articles of Association

■ Shareholders

■ Directors

Co. Shareholders

Cell B Cell CCell A

'A' Assets 'B' Assets 'C' Assets

AShareholders

Protected/IncorporatedCell Company

ADirectors

Co. Directors

BDirectors

BShareholders

CShareholders

CDirectors

Structure Chart

Alternative ICC Structure

XYZ ICC

F Master IC G Master IC H Master IC

I IC J IC

K Master IC L Master IC

A IC B IC C IC D IC E IC

Advantages

■ Greater legal certainty

■ Reduced complexity

■ Flexibility

■ Administrative cost savings

Practical Issues

■ Different features between cells

■ Conversion from ordinary company to cell company

■ Contractual relations

■ Inter-cell contamination

■ Directors duties

■ Access to financial information

■ "The big issue" – recognition in other jurisdictions

Comparison with other jurisdictions

■ No restrictions as to use

■ Greater certainty

■ Separate memorandum and articles of association

■ Position of shareholders and directors

■ PCC or ICC?

Legal Aspects Related to Funds - Protected Cell

Companies/Incorporated Cell Companies

Simon Pascoe Partner Bedell Group, Jersey

simon.pascoe@bedellgroup.com

Jersey | Guernsey | London | Dublin | Geneva