Electronic Records

• Subject to a limited number of mandatory provisions, those undertaking e-business are free to contract out of the Law – the Law is intended to provide a framework and certainty but not to fetter the ways in which parties which to carry out legitimate e-business.
• Electronic records are expressly given legal recognition.
• Where a document has to be in writing for legal purposes, a document in electronic form will meet that requirement.  However, wills are expressly excluded and other documents may also be excluded by regulation.  At present, real estate documents are not excluded.
• Subject to conditions, delivery of legal documents may be made electronically.
• An electronic version of an original document may be used as evidence (including in court) of the original provided that the electronic version is an accurate representation of the original.
• Subject to conditions, legal documents may be retained and made available for inspection in electronic form.
• Contracts and Electronic Communications
• Contracts may be made electronically e.g. by exchange of emails.
• Specific rules with regard to attributing an electronic record to the originator – considerable care will be needed by originators to ensure that they do not become legally bound inadvertently.
• Specific rules dealing with the legal consequences of a change or error arising in an electronic message during transmission, the validity of acknowledgements of electronic messages, the time at which an electronic message is sent and received and the place at which an electronic message is sent and received – the latter is potentially very important with regard to jurisdictional issues surrounding governing law and the correct forum for enforcement of a contract.

• Digital signatures on a document have the same legal validity as a conventional signatures. Specific rules as to what will constitute a reliable digital signature and provision for further regulation on this issue.
•  Provision for specific recognition by the Minister for Commerce of Certificates as to authenticity of digital signatures given by foreign information security service providers and of digital signatures complying with the laws of foreign jurisdictions.  However, parties conducting e-business are still free to choose their own certification and other security measures with regard to authenticity.
• Documents may be notarised and signed electronically.

• Regime established for the approval and registration of providers of information security services (this is likely to be principally businesses offering encryption services) and their conduct.

• Specific defences (in the case of a criminal prosecution) or limitations of liability (in the case of a civil suit) for e-commerce service providers and intermediaries – important to note that definitions of each are very wide.  An e-commerce service provider is “a person who uses electronic means in providing real or personal property, services or information” (probably, a significant majority of businesses operating in the Cayman Islands) and an “intermediary” is “with respect to an electronic record a person who processes that electronic record for another person”.

• No specific rules with regard to data protection but provision made for regulations in this area.

• Provision for regulations to establish a code of conduct in relation to e-commerce service providers and intermediaries.
• Criminal liability for directors and officers of a body corporate which commits an offence under this Law where there is consent, connivance or neglect on the part of the director or officer.
• General power to make further regulations under the Law.
• Specific prohibition on regulations being introduced imposing a requirement for “key” depositing with a third party.
• Provision for the appointment of an e-Business Advisory Board.
• Consequential amendments to a number of other statutes.  In particular, clarification that a Cayman Islands exempted company (IBC) is not prohibited from conducting e-business from within the Cayman Islands either directly or through an ISP located in the Cayman Islands.

International Management Services Ltd
P.O. Box 61, 
Harbour Centre
George Town, 
Grand Cayman, 
Cayman Islands 

Phone:  345 949 4244 
Fax:  345 949 8635 
Email: ims@candw.ky

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