IRELAND Law and Practice Contributed by: Nicholas Blake-Knox, Jonathan Sheehan, Damien Barnaville and Joe Mitchell, Walkers
entity if a single shareholder) for US federal income tax purposes; • the ability to amend the ICAV’s constitutional document, known as the instrument of incor - poration, without shareholder approval for certain types of changes; • the ability to prepare separate financial state - ments for separate sub-funds of the ICAV; and • not being required to make the audited finan - cial statements publicly available. Unit Trust Investors seeking to use a trust structure for their investment fund can establish an AIF in Ireland structured as a unit trust. Unlike the investment company and the ICAV, which issue shares to their investors, unit trusts issue investors units representing a beneficial interest in the assets of the trust. As it is a trust arrangement, a unit trust is not a separate legal entity, meaning that it does not have power to enter into contracts in its own name. In practice, the board of directors of the fund manager acts on behalf of the unit trust. CCF While CCFs were initially developed in 2003 to facilitate the pooling of pension fund assets in a tax-efficient manner, this structure may be used by any entity seeking a tax-transparent struc - ture; however, individuals cannot invest in CCFs. A CCF is a contractual arrangement constituted by a deed of constitution entered into between a management company and a depositary. Units in a CCF identify the proportion of the underlying investments of the CCF to which an investor is beneficially entitled. Through contractual arrangements entered into with the management company, the investors participate and share in the property of the investment fund as co-owners of the assets of
the fund. As a co-owner, each investor in the CCF holds an undivided co-ownership interest as a tenant in common with the other investors. The CCF is a tax-transparent structure, which means that investors in a CCF are treated as if they directly own a proportionate share of the underlying investments of the CCF rather than shares, units or interests in an entity that itself owns the underlying investments. ILP The Investment Limited Partnerships (Amend - ment) Act 2020 amended the legislation gov - erning ILPs, Ireland’s regulated investment funds partnership product. These amendments enhanced the product offering by bringing it more in line with the partnership structures in other fund jurisdictions and introducing best-in- class features. While partnership structures are generally used for investment funds with strategies relating to private equity or debt, real estate, infrastructure or other types of illiquid assets, the ILP is a flex - ible structure that can be utilised by asset man - agers seeking to establish either open-ended or closed-ended investment funds through a regulated partnership structure. An ILP can be structured as an umbrella fund, offering greater flexibility for those seeking to establish funds in Ireland. Investors in an ILP hold interests in the limited partnership by entering into a partnership agreement with the general partner as limited partners. An Irish fund can be established as either a standalone fund or an umbrella fund compris - ing one or more sub-funds, each with segre - gated liability. Each sub-fund will generally have a different investment objective and policies, and may comprise different classes of shares/
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