LUXEMBOURG Law and Practice Contributed by: Frédéric Feyten, Alejandro Dominguez Becerra, Gérard Maîtrejean and Pawel Hermeliński, CMS
An investment company subject to the SIF regime can also be established through a société d’investissement à capital variable (SICAV) or a société d’investissement à capital fixe (SICAF), that is to say, through the form of a corporate-type fund. Unlike SICAFs which are not subject to restrictions regarding their corporate form, when a SIF established under the form of a SICAV, it needs to adopt any of the following corporate forms as provide by the SIF Law: a public limited company ( société anonyme ), a partnership limited by shares ( société en commandite par actions ), a common limited partnership ( société en commandite simple ), a special limited partnership ( société en commandite spéciale ), a private limited company ( société à responsabilité limitée ) or a co- operative set up as a public limited company ( société coopérative organisée sous forme de société anon- yme ). It is noteworthy that, of the various corporate forms available for the establishment of an investment com - pany, the SCSp is particularly well appreciated. Lack - ing legal personality, its structure is closely analogous to that of the UK limited partnership, a vehicle that has long been preferred as regards private investments. Finally, a SIF must have its registered office and head office (central administration) in Luxembourg. Flexibility The SIF Law affords comprehensive flexibility regard - ing the range of assets in which a SIF may invest, provided that the investment objective, strategy, and policies receive prior approval from the CSSF. The SIF regime is specifically tailored to facilitate undertakings for collective investment (UCIs) that invest across all asset classes and pursue both traditional and alter - native investment strategies. It expressly enables the structuring of funds of diverse nature, such as equity funds, bond funds, money market funds, real estate funds, hedge funds, private equity funds, debt funds, venture capital funds, green funds, infrastructure funds, to name just a few of them. Structuring aspects The net assets of a SIF may not be less than EUR1,250,000 (including share capital and share pre -
mium). The minimum capitalisation must be reached within 24 months of the SIF receiving authorisation from the CSSF. Where a SIF is constituted as an investment company, it is permitted to issue partly paid shares, provided that at least 5% per share is paid up upon issuance, subject to exceptions appli - cable to certain legal forms. The assets of a SIF shall be valued at fair value deter - mined in accordance with the rules specified in the constitutive documents, unless the latter provide oth - erwise. The SIF Law expressly permits the creation of a SIF structured as an umbrella fund containing multiple compartments. Each compartment may be distin - guished by a range of features, including, but not limited to, its investment policy, redemption policy, dividend policy, fee structure, reference currency, appointed investment manager or adviser and type of target investors. According to the SIF Law, each compartment within such a SIF is associated with a distinct portfolio of investments which is separated from the portfolios of other compartments, except where the constitutive documents specify otherwise. Although a SIF con - taining multiple compartments is regarded as a single legal entity, the assets linked to a compartment are only available to satisfy the rights of investors and the claims of creditors relating to that specific compart - ment, unless the constitutive documents of the SIF expressly provide for the contrary. The CSSF can revoke the authorisation granted to a single compartment without this decision necessarily affecting the authorisation granted to the other com - partments. Furthermore, each compartment may be subject to separate liquidation proceedings and the liquidation of one compartment does not trigger the liquidation of any other compartment. It is only upon the liquidation of the last existing compartment that the SIF itself shall be considered in liquidation. It is possible to create various classes of securities or partnership interests within the same SIF. This mecha - nism can also be used within a same compartment of a SIF structured as an umbrella fund. These classes
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