A PCC is a company that consists of one Core and an indefinite number of Cells which are kept legally separate from each other. Each Cell has assets and liabilities attributed to it, and its assets cannot be used to meet the liabilities of any other Cell.
The PCC also has non-cellular (Core) assets which may be available to meet the liabilities that cannot be attributed to any individual Cell. Thus, different risks within one company can be segregated or "ring-fenced" through the use of Cells and this feature makes PCCs attractive for insurance (including long-term and re-insurance), captive insurance purposes and for collective investment fund structures, asset holding and structured finance businesses.
In some jurisdictions like the Republic of Mauritius, PCCs can be structured so as to obtain access to double taxation avoidance treaties and hence obtain favourable tax treatment, while being taxed as a single entity.
A PCC will normally issue two classes of shares. On one hand, shares will be issued for the Core and these will carry voting rights, and on the other hand, there will be cellular shares issued for each Cell and which do not carry any rights as to voting.
Each Cell will have its own name or designation, which may be the name of the holder of the cellular shares attributed to it, or which may simply be an identifying number in order to preserve anonymity. The PCC will be managed by directors who may decide to transfer the management of the company to third parties having specialised knowledge in the field.
While dividends are payable only by reference to the profits made by each individual Cell, the PCC is taxed as a single entity - even with an unlimited number of Cells - and may additionally enjoy access to double taxation avoidance treaties, for example, by being structured a Category 1 Global Business Company resident in Mauritius.
A PCC is managed by its directors, which can be provided by AAMIL, but the management can also be transferred to another person or entity through a management contract.
