Protected Cell Companies (PCCs) and Incorporated Cell Companies (ICCs)

Guernsey was the first jurisdiction in the world to introduce legislation with respect to (PCCs) and the Island has continued to enjoy an unparalleled reputation for the management of this type of corporate structure to the present day. Since the first Protected Cell Company (PCC) was incorporated in 1997 the legislation has been reviewed and developed to increase the scope and flexibility of this structure which was initially only able to be used for collective investment funds, insurers, securitisation and other unregulated vehicles carrying on financial services activities. Now a PCC can be used for the full range of commercial activities from simple asset holding to complex financial arrangements for sophisticated corporate customers.

ICCs were introduced in 2006 as an alternative to PCCs and are in affect a hybrid of the PCC and a group of standard incorporated companies.

The benefit of the cellular structure is the ability to segregate and manage risk – a feature which has made the use of these structures popular with the investment and insurance industries.

The key difference between the two is that the PCC is a single legal entity, but the company is made up of individual “protected cells”. However, each cell of an ICC is a separate legal entity therefore contractual arrangements can be made between cells. The ICC therefore provides additional inter‑cell security in the event of insolvency.

The flexibility of the Guernsey companies law allows a PCC to be converted to an ICC and an ICC cell to become a stand alone incorporated company.