LUXEMBOURG LIVES UP TO ITS REPUTATION, AGAIN POSITIONING ITSELF AS AN INNOVATIVE EU FINANCIAL CENTRE FOR FUNDS

Luxembourg is preparing the legal framework for a new fund vehicle to meet the interests and requirements of market participants. A draft law on a new type of non-regulated Luxembourg AIF, called the “Reserved Alternative Investment Fund” (RAIF), has been put to the Luxembourg parliament. The aim is for the law to be passed in the second quarter of 2016.

This law will introduce and create a new type of product in addition and as a supplement to the Law on Alternative Investment Fund Managers (AIFM), Luxembourg special investment funds (SIF), funds in accordance with Part II of the Law of 2010 (UCIs) and the regulations on SICARs.

The CSSF currently authorises and supervises Luxembourg funds, which include AIFMs and AIFs, UCITS and SICARs (investment companies in risk capital).

In the future, fund initiators and managers will be able to benefit from the rapid establishment of an RAIF, as this product will not require separate up-front authorisation. You can decide whether your requirements are met by a regulated fund or a non-regulated RAIF, or rather, whether the advantage of rapid establishment and investment is your key criterion.

The draft law does stipulate, however, that a non-regulated RAIF must be managed by an authorised, external AIFM. We offer to perform this role. Accordingly, with our company as its AIFM, the non-regulated RAIF will benefit from the advantages of the EU AIFM passport and may be marketed quickly to well-informed and knowledgeable investors. The investment policy can be freely defined, without legal regulation. The requirements for diversification of risk in terms of assets are lifted in return for corresponding transparency in the marketing documents. A degree of alignment with the SIF law of 2007 is, however, likely.

Would you like to receive additional information to establish an RAIF with us in the future? Feel free to contact us!

Anja Richter / anja.richter@mainfirst.com / Phone: +352 276 912 23

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