Observations and Changes for REEFS Investment Strategy Selections

The CIMA has announced that effective from 15 November 2023, certain changes will be made to the Investment Strategy selections available in the REEFS portal for fund applications and FAR filings. The objective of these changes is to enhance monitoring and improve the reporting accuracy of regulated Mutual Funds‘ and Private Funds‘ investment strategies.
To achieve more improved statistical reporting, the CIMA will officially remove certain general Investment Strategy categories and introduce more granular classifications. Additionally, the naming of some Investment Strategy categories will be revised for clarity.
In line with global initiatives within the ESG landscape and the Cayman Islands Government’s Climate Change-related initiatives, the CIMA recognizes theimportance of identifying, measuring, monitoring, and managing material ESG-related risks. Therefore, the Authority aims to obtain more accurate data on the number of ESG and/or climate-focused funds in the jurisdiction.
The Authority has observed that despite considerable evidence in the Offering Memorandums that funds incorporate ESG considerations, ESG is seldom selected in fund applications or FAR submissions. In light of this, CIMA requests that funds with ESG as their core focus should select it as the Primary Investment Strategy. For funds that have ESG considerations as non-core but with material substance, ESG should be selected as the *Secondary Investment Strategy.
The changes to the Investment Strategy selections are as follows: Private Equity and Other will be removed, while Absolute Return, Capital Structure Arbitrage, Convexity, Derivatives Trading, Energy/Power, Equity Hedged, Equity Long Only, Fund of Private Equity Funds, Growth Equity/Growth Capital, Infrastructure, LBO, Long-Only Absolute Return, Private Credit, Quantitative, and Secondaries will be added. Amendments will also be made to Asset-Backed/Mortgage-Backed Securities, Crypto/Digital/Virtual Assets-related, Distressed/Special Situations, Fixed Income/Debt, Fixed Income Arbitrage/Debt, and Foreign Exchange/Currency Trading.
The revised Investment Strategy list has been available in the REEFS Portal since early 2023 for manual submission of fund registration applications. Starting from 15 November 2023, all fund registration applications, including bot submissions, must use the revised Investment Strategies list. Similarly, FAR submissions for funds with financial years ending on or after 31 December 2023 must* adhere to the revised Investment Strategy list.
These changes aim to improve the monitoring and reporting of investment strategies in Mutual Funds and Private Funds. They also align with the evolving landscape of ESG considerations and climate-related initiatives**.