By setting up an investment fund in Luxembourg, its founders can obtain EU citizenship, Tht, in turn, means that funds (& their managers) may be purchased by investors in the EEA under a simplified procedure.
Luxembourg: Creating a Joint Fund
Those wishing to start investment activities in Luxembourg may:
- set up a RAIF in Luxembourg;
- open a SIF in Luxembourg;
- set up an unregulated AIF in Luxembourg;
- establish a SICAR in Luxembourg.
The management of a RAIF, SICAR, SIF or an unregulated AIF must be carried out by authorized AIFMs. The latter, in their turn, must appoint a depository. Funds’ assets are to be kept separately from those of depositaries. Please note that individuals wishing to establish an unregulated AIF in Luxembourg ( managed by registered AIFMs) mustn’t appoint a depositary.
Responsibility for the financial instruments held by 3rd parties appointed as custodians or custodians themselves lies with custodians. In some exceptional circumstances, custodians can be relieved of their responsibilities. There’s 2 kinds of depositories in Luxembourg, namely:
- professional depositories for assets other than financial instruments.
Those seeking to get a license authorizing operations with assets in Luxembourg should be mindful of the fact that a SICAR or SIF managed by them must apply for registration with a register kept by the CSSF .
Those wishing to register an unregulated fund in Luxembourg (RAIFs or unregulated AIFs) mustn’t apply for permission with the CSSF. Apart from that, their activities won’t be overseen or regulated by the CSSF. A ManCoor AIFM must manage FCPs, while BoDs or general partners are required to manage a SICAVs/SICARs.
Non-regulated funds are required to provide Luxembourg’s Central Bank with certain financial statements.
Considering creating an investment fund in Luxembourg? Looking for advice on the regulation of fund activities in Luxembourg? IQ Decision UK is the answer!