VP Fund Solutions

4 | VP Fund Solutions | Global solutions for your local needs
Overview of financial centres serviced
by VP Fund Solutions
Over the last 10 years Liechtenstein has developed as an investment
fund domicile, creating a modern and innovative
legislative and regulatory framework for investment fund
solutions. Around 700 funds or sub-funds are registered in
Liechtenstein. Its membership of the European Economic
Area and its close economic ties to financial institutions in
Switzerland have enabled the country to become a major
hub, not only for Swiss asset managers and family offices but
also for European asset managers and promoters wishing
to establish investment fund structures. An attractive fiscal
environment, a strong emphasis on the individual structuring
needs of investors as well as an overall climate of political
and economic stability contribute to Liechtenstein’s reputation
as a financial centre. Liechtenstein’s legal framework allows
diverse fund structuring requirements to be addressed.
The country’s central geographical position, close to other
financial centres such as Zurich, Lugano and Vienna, make
it possible to maintain close links with clients and other
providers. The local regulator continuously strives to offer
fund operators fast and pragmatic access to the market.
Luxembourg is the leading European location for investment
funds, second only to the United States of America by net
asset volume. Luxembourg is home to over 3,800 fund structures
(UCIs) and around 270 risk capital investment companies
(SICARs). Over the last 25 years Luxembourg has succeeded
in establishing itself as a key player in the investment
fund industry, with Luxembourg UCITS funds becoming in
certain regards the industry standard for cross-border distribution
within the European Economic Area and in major
Asian and Latin American markets. Part of Luxembourg’s
appeal as an investment fund centre lies in the availability of a
highly professional and multilingual workforce, the country’s
political and fiscal stability, a flexible and pragmatic approach
to finding solutions and a proactive regulatory environment
that is closely geared to the needs and trends of the industry.
The ability of the Luxembourg fund industry to provide rapid
and pragmatic fund solutions has won it much respect as a
centre for successful fund innovation.
The British Virgin Islands (BVI) are one of the leading
jurisdictions for alternative investment funds, offering an
increasingly regulated environment in which to realise flexible
collective investment solutions aimed primarily at sophisticated
or professional investors. There are more than 2,900
funds recognised in the BVI. Regulation in the BVI focuses
on the entity in charge of managing the fund’s assets. Under
the new regulatory framework introduced in 2010, a fund
is now required to appoint an independent auditor, manager,
custodian and administrator. These independent service
providers may operate from any recognised jurisdiction and
are not restricted to providing services from within the BVI.
Under the new regime, funds are now required to appoint a
BVI-resident authorised representative.
The Cayman Islands have developed over the last 35 years
into the world’s leading financial centre for offshore hedge
funds, providing a flexible and efficient regulatory environment.
In recent years the Cayman Islands have constantly
improved their legal and regulatory framework to achieve
greater compliance with constantly evolving international
standards. As in the BVI, the fund may appoint a custodian
and an administrator in another jurisdiction. The Cayman
Islands allow for the operation of exempted investment
managers.
In recent years Anguilla has developed as an alternative
financial centre. It now offers a wide range of alternative
investment fund solutions. Anguilla is characterised by a
flexible, business-oriented regulatory environment which
allows providers to set up investment fund solutions adapted
to the needs of managers and investors.
The above offshore financial centres have undergone considerable
change in recent years, largely aimed at strengthening
regulation to give greater investor protection and to help combat
money laundering and the financing of terrorism. They
have also taken part in the global effort to create a framework
for the exchange of information on tax-related matters.