INTRODUCTION Contributed by: Sam Kay, Dechert LLP
Investment Funds 2025 – Global Overview This cross-border legal guide provides a glob - al comparison of fundamental legal, tax and regulatory considerations relating to the estab - lishment and operation of investment funds in a range of jurisdictions where the industry is active. Each chapter is written by leading legal advisers from the relevant jurisdiction. Certain chapters focus on particular jurisdictions, in a question-and-answer format, providing informa - tion on the structures typically used, the regula - tory framework for those funds, any significant operational requirements, how the funds may be marketed, a summary of the tax treatment for both the fund itself and investors, and custom - ary or common terms. The guide also contains a number of chapters highlighting trends and developments in the investment funds market. This guide seeks to provide guidance on the key questions arising when industry participants are seeking to establish, operate, market and/or invest in an investment fund. Investment funds often operate across multiple jurisdictions, so those who understand the global landscape will be at a distinct commercial advantage, and will be able to minimise their risk of falling foul of local laws. The key objectives when setting up an invest - ment fund that are discussed in this guide There are a multitude of different legal structures available, and each jurisdiction applies its own legal and regulatory framework. Certain jurisdic - tions are traditionally utilised for certain strat - egies. However, ongoing legal developments in those jurisdictions, coupled with attractive investment funds regimes being introduced and/or modernised in the less obvious choices include the following. Choice of domicile
of jurisdictions seeking to compete with more established jurisdictions, mean that the domicile used by a manager for its last fund may not be the best option for its next fund. This guide will provide up-to-date information on the typical forms of investment fund vehicles available in each jurisdiction, to assist in making decisions relating to domicile. Asset class There is also a wide variety of asset classes that are captured within the market, from traditional long-only equity funds through to leveraged buy - out funds and hedge funds. Funds for different asset classes will have their own bespoke fea - tures and requirements. The industry develops in response to demand and now offers many ways for investors to customise their exposure to certain asset classes. Current trends – such as secondaries transactions, general partner-led fund restructurings, hybrid or “evergreen” funds and the drive towards the “democratisation” of the private funds market – demonstrate that the investment funds industry is flexible and accom - modating to investors. Regulatory and tax considerations The global investment funds industry continues to grow and innovate at pace against the back - drop of an increasingly complex regulatory, tax and legal landscape, and this is expected to car - ry on during 2025 and beyond. Without doubt, the number of legal, tax and regulatory issues that have to be considered when establishing an investment fund has increased significantly, and regulators and tax authorities across the world are introducing more complex reforms. A fund manager's failure to comply with these requirements can lead to significant fines or, in extreme cases, custodial sentences. There - fore, it is important to understand the applicable
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