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Amendment of section 16 - licensed mutual fund administrators to be satisfied in respect 4. Mutual Funds (Amendment) Act, 2026 MUTUAL FUNDS (AMENDMENT) ACT, 2026 AN ACT TO AMEND THE MUTUAL FUNDS ACT (2025 REVISION) TO PROVIDE FOR SPECIFIC REQUIREMENTS FOR TOKENISED MUTUAL FUNDS; TO PROVIDE DEFINITIONS FOR \u201cDIGITAL EQUITY TOKEN\u201d AND \u201cTOKENISED MUTUAL FUND\u201d; AND FOR INCIDENTAL AND CONNECTED PURPOSES ENACTED by the Legislature of the Cayman Islands.\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_1\", \"num\": \"1.\", \"text\": \"Short title 1. This Act may be cited as the Mutual Funds (Amendment) Act, 2026.\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_2\", \"num\": \"2.\", \"text\": \"Amendment of section 2 of the Mutual Funds Act (2025 Revision) - definitions 2. The Mutual Funds Act (2025 Revision), in this Act referred to as the \u201cprincipal Act\u201d, is amended in section 2 as follows \u2014 (a) in the section heading, by deleting the word \u201cDefinitions\u201d and substituting the word \u201cInterpretation\u201d; (b) in the definition of the word \u201cdebt\u201d, by deleting the words \u201cin respect of a share,\u201d and substituting the words \u201cin respect of a share, an LLC interest,\u201d; I Assent, Jane Owen Governor Date: 19th March, 2026 Mutual Funds (Amendment) Act, 2026 (c) in the definition of the words \u201cequity interest\u201d, by deleting the words \u201cmeans a share,\u201d and substituting the words \u201cmeans a share, LLC interest,\u201d; and (d) by inserting in the appropriate alphabetical sequence the following definitions \u2014 \u201c \u201cdigital equity token\u201d means a digital representation of the whole of an equity interest held by an investor in a mutual fund; \u201cLLC interest\u201d has the meaning assigned by section 2 of the Limited Liability Companies Act (2025 Revision); \u201cpartnership interest\u201d means the interest of a partner in a partnership in respect of \u2014 (a) the profit; (b) the capital; and (c) the voting or other rights, benefits or obligations, to which the partner is entitled or subject pursuant to the partnership agreement or this Act; and \u201ctokenised mutual fund\u201d means a mutual fund that has any of its equity interests represented by digital equity tokens;\u201d.\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_3\", \"num\": \"3.\", \"text\": \"Amendment of section 16 - licensed mutual fund administrators to be satisfied in respect of mutual funds 3. The principal Act is amended in section 16(1) as follows \u2014 (a) in paragraph (c), by deleting the words \u201ca proper way,\u201d and substituting the words \u201ca proper way;\u201d; (b) in paragraph (d), by deleting the words \u201cby the Authority.\u201d and substituting the words \u201cby the Authority; and\u201d; and (c) by inserting after paragraph (d) the following paragraph \u2014 \u201c(e) in the case of a tokenised mutual fund \u2014 (i) all records relating to the issuance, creation, sale, transfer and ownership of an equity interest that is represented by a digital equity token (including records containing any additional information which may be required by the Authority), are securely maintained by the tokenised mutual fund and are available to the Authority, or any person assigned by the Authority, within the period specified by the Authority; and (ii) the tokenised mutual fund has complied with every other requirement under this Act which is applicable to a tokenised mutual fund.\u201d. Mutual Funds (Amendment) Act, 2026\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_4\", \"num\": \"4.\", \"text\": \"Insertion of Part 3B - tokenised mutual funds 4. The principal Act is amended by inserting after section 22H the following Part \u2014 \u201cPart 3B - Tokenised Mutual Funds Specific requirements for tokenised mutual funds 22I. (1) The requirements in this section apply in respect of a tokenised mutual fund and are in addition to the other requirements under this Act. (2) The operator of a tokenised mutual fund shall confirm annually to the Authority that all records relating to the issuance, creation, sale, transfer and ownership of an equity interest that is represented by a digital equity token have been properly kept and maintained in compliance with the requirements of this Act. (3) An equity interest that is represented by a digital equity token is only transferrable with the approval of the operator of the tokenised mutual fund in accordance with the offering document. (4) The tokenised mutual fund shall disclose in the offering document any risks specific to the digital equity tokens identified by the tokenised mutual fund, including considerations regarding cybersecurity, the transferability of the digital equity token and any other potential risks identified by the Authority. (5) The offering document shall set out how the risks identified in subsection (4) are addressed or mitigated for investors. (6) The Authority may impose specific restrictions on the characteristics of a digital equity token that represents an equity interest created by a tokenised mutual fund and, where the Authority imposes specific restrictions, the tokenised mutual fund shall ensure that the digital equity token is in compliance with those requirements. (7) The tokenised mutual fund shall comply with any periodic reporting requirement specified by the Authority under this Act. (8) The Authority \u2014 (a) may request any additional information that is required to enable the Authority to make a decision on an application in respect of a tokenised mutual fund; and (b) shall monitor on-going compliance of a tokenised mutual fund with the requirements of this Act. Mutual Funds (Amendment) Act, 2026 Exercise of supervisory powers by the Authority 22J. The Authority shall exercise supervisory powers over tokenised mutual funds to ensure compliance with this Act and the protection of investor interests including carrying out inspections of \u2014 (a) the underlying technology; and (b) digital equity token transactions.\u201d. Passed by the Parliament the 5th day of March, 2026. Hon. D. 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TO PROVIDE\nDEFINITIONS FOR \u201cDIGITAL EQUITY TOKEN\u201d AND \u201cTOKENISED MUTUAL FUND\u201d;\nAND FOR INCIDENTAL AND CONNECTED PURPOSES\nENACTED by the Legislature of the Cayman Islands.\n1.\nShort title\n1.\nThis Act may be cited as the Mutual Funds (Amendment) Act, 2026.\n2.\nAmendment of section 2 of the Mutual Funds Act (2025 Revision) -\ndefinitions\n2.\nThe Mutual Funds Act (2025 Revision), in this Act referred to as the \u201cprincipal Act\u201d,\nis amended in section 2 as follows \u2014\n(a)\nin the section heading, by deleting the word \u201cDefinitions\u201d and substituting\nthe word \u201cInterpretation\u201d;\n(b) in the definition of the word \u201cdebt\u201d, by deleting the words \u201cin respect of a\nshare,\u201d and substituting the words \u201cin respect of a share, an LLC interest,\u201d;\n(Act 5 of 2026)\nI Assent,\nJane Owen\nGovernor\nDate: 19th March, 2026\n\nSection 3\nMutual Funds (Amendment) Act, 2026\n\nPage 6\nAct 5 of 2026\nc\n\n(c)\nin the definition of the words \u201cequity interest\u201d, by deleting the words\n\u201cmeans a share,\u201d and substituting the words \u201cmeans a share, LLC\ninterest,\u201d; and\n(d) by inserting in the appropriate alphabetical sequence the following\ndefinitions \u2014\n\u201c \u201cdigital equity token\u201d means a digital representation of the whole\nof an equity interest held by an investor in a mutual fund;\n\u201cLLC interest\u201d has the meaning assigned by section 2 of the Limited\nLiability Companies Act (2025 Revision);\n\u201cpartnership interest\u201d means the interest of a partner in a\npartnership in respect of \u2014\n(a)\nthe profit;\n(b)\nthe capital; and\n(c)\nthe voting or other rights, benefits or obligations,\nto which the partner is entitled or subject pursuant to the partnership\nagreement or this Act; and\n\u201ctokenised mutual fund\u201d means a mutual fund that has any of its\nequity interests represented by digital equity tokens;\u201d.\n3.\nAmendment of section 16 - licensed mutual fund administrators to be\nsatisfied in respect of mutual funds\n3.\nThe principal Act is amended in section 16(1) as follows \u2014\n(a)\nin paragraph (c), by deleting the words \u201ca proper way,\u201d and substituting\nthe words \u201ca proper way;\u201d;\n(b) in paragraph (d), by deleting the words \u201cby the Authority.\u201d and substituting\nthe words \u201cby the Authority; and\u201d; and\n(c)\nby inserting after paragraph (d) the following paragraph \u2014\n\u201c(e) in the case of a tokenised mutual fund \u2014\n(i)\nall records relating to the issuance, creation, sale, transfer\nand ownership of an equity interest that is represented by\na digital equity token (including records containing any\nadditional information which may be required by the\nAuthority), are securely maintained by the tokenised\nmutual fund and are available to the Authority, or any\nperson assigned by the Authority, within the period\nspecified by the Authority; and\n(ii) the tokenised mutual fund has complied with every other\nrequirement under this Act which is applicable to a\ntokenised mutual fund.\u201d.\n\nMutual Funds (Amendment) Act, 2026\nSection 4\n\nc\nAct 5 of 2026\nPage 7\n\n4.\nInsertion of Part 3B - tokenised mutual funds\n4.\nThe principal Act is amended by inserting after section 22H the following Part \u2014\n\u201cPart 3B - Tokenised Mutual Funds\nSpecific requirements for tokenised mutual funds\n22I. (1)\nThe requirements in this section apply in respect of a tokenised\nmutual fund and are in addition to the other requirements under this\nAct.\n(2) The operator of a tokenised mutual fund shall confirm annually to the\nAuthority that all records relating to the issuance, creation, sale,\ntransfer and ownership of an equity interest that is represented by a\ndigital equity token have been properly kept and maintained in\ncompliance with the requirements of this Act.\n(3) An equity interest that is represented by a digital equity token is only\ntransferrable with the approval of the operator of the tokenised\nmutual fund in accordance with the offering document.\n(4) The tokenised mutual fund shall disclose in the offering document\nany risks specific to the digital equity tokens identified by the\ntokenised\nmutual\nfund,\nincluding\nconsiderations\nregarding\ncybersecurity, the transferability of the digital equity token and any\nother potential risks identified by the Authority.\n(5) The offering document shall set out how the risks identified in\nsubsection (4) are addressed or mitigated for investors.\n(6) The Authority may impose specific restrictions on the characteristics\nof a digital equity token that represents an equity interest created by\na tokenised mutual fund and, where the Authority imposes specific\nrestrictions, the tokenised mutual fund shall ensure that the digital\nequity token is in compliance with those requirements.\n(7) The tokenised mutual fund shall comply with any periodic reporting\nrequirement specified by the Authority under this Act.\n(8) The Authority \u2014\n(a)\nmay request any additional information that is required to\nenable the Authority to make a decision on an application in\nrespect of a tokenised mutual fund; and\n(b) shall monitor on-going compliance of a tokenised mutual fund\nwith the requirements of this Act.\n\nSection 4\nMutual Funds (Amendment) Act, 2026\n\nPage 8\nAct 5 of 2026\nc\n\nExercise of supervisory powers by the Authority\n22J. The Authority shall exercise supervisory powers over tokenised mutual\nfunds to ensure compliance with this Act and the protection of investor\ninterests including carrying out inspections of \u2014\n(a) the underlying technology; and\n(b) digital equity token transactions.\u201d.\nPassed by the Parliament the 5th day of March, 2026.\nHon. D. 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