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Specialised Investment Funds (SIF) | Whitepaper


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Specialised Investment Funds (SIF)Scope

  • Lightly regulated and tax efficient multipurpose investment fund vehicle including alternative investment strategies (e.g. real estate, private equity, infrastructure, renewable energy, hedge, art funds, etc.).

Eligible investors

  • Institutional or professional investors.
  • Private individuals adhering in writing to a well-informed investor status and who
    • invest at least €125,000, or
    • have certification by a credit institution, an investment firm or a management company to adequately comprehend such investment.

Authorisation – Supervision

  • Subject to the supervision of the Luxembourg regulatory authority (CSSF).
  • May start its activities without prior approval by CSSF provided an application file is submitted to the authorities within one month following its creation.

Legal framework

  • Contractual form: common funds (FCP) represented by a management company.
  • Corporate form: investment companies with variable capital (SICAV) structured as public limited company (S.A.), private limited liability company (S.à R.L.), partnership limited by shares (S.C.A.) or cooperative in the form of a public limited company.
  • Any other legal form available under the Luxembourg commercial law.
  • Possibility to have separate portfolios under an umbrella structure.

Investment policy

  • Broad range of eligible assets.
  • No borrowing limitations.
  • Risk spreading principle (30% threshold).

Regulatory framework

  • Registered seat and central administration located in Luxembourg.
  • Minimum capital (net assets for FCP) of €1,250,000 to be reached within a period of 12 months following the approval from the CSSF.
  • Directors of the fund or of the management company (if FCP) must justify their reputation, and prove their professional experience in relation to the SIF profile.
  • Depositary must be a Luxembourg bank or a Luxembourg branch of a bank with its registered seat in another EU member state.
  • Independent auditor required.
  • Promoter and Investment managers not subject to approval of the CSSF.
  • Possibility to be listed.

Reporting

  • Annual audited report to be made available within 6 months of the end of the period.
  • No requirement to publish net asset value.
  • No semi-annual report.
  • Choice of the valuation method of the assets.

Taxation

  • Possibility to opt for a tax transparent form (FCP) or a corporate form depending on investor’s requirements.
  • Annual subscription tax of 0.01% of net assets. Certain investment may be exempted (e.g. pension pooling vehicle and fund of Luxembourg funds).
  • No taxation on income and capital gains.
  • No capital duty applies on incorporation of the corporate form (except a registration duty of €75).
  • No withholding tax upon distribution to investors unless EU Savings Directive applies.
  • Not subject to net worth tax.
  • Possibility for a corporate form to benefit from certain tax treaties concluded by Luxembourg.
  • VAT exemption on management services.

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