Protected Cell Companies
Protected Cell Companies Act allows for protected cell
companies engaged in insurance business to be registered and companies
engaged in other businesses to be registered with the approval of the
Commission. If engaged in insurance business, a protected cell company (PCC)
would first require to be licensed as an insurer under the Insurance Act
2004. Further, if that insurer wishes to underwrite programmes on a
protected cell basis, it will have to be registered under the Act.
The Act makes provision for the registration of PCCs and sets
out rules governing the registration, management and administration of such
companies. In the Act a protected cell account is defined as a separate and
distinct account (comprising assets, rights, liabilities and obligations) of
a protected cell company. However, the establishment of a protected cell
account does not create a legal person distinct from the protected cell
company. A feature of a protected cell company is that any asset, which is
linked to a particular protected cell account shall be held as a separate
fund, which is not part of the general assets of the protected cell company,
and is held exclusively for the benefit of the account owner of the
protected cell account and to any counter-party to a transaction linked to
that protected cell account. Assets in such account shall only be available
to meet liabilities to the owners and creditors of that protected cell
account. The Act provides that any asset which attaches to a particular
account shall not be available or used to meet liabilities to, and shall for
all purposes be protected from, the general shareholders and from the
creditors of the company who are not creditors with claims linked to the
particular protected cell account identified in the governing instrument.
The Act further creates statutory rights and obligations with
respect to protected cell accounts and to receivership and winding up of
protected cell companies.
Application forms and fees are to be found in the
Protected Cell Company Regulations.