#funds #alternativefunds #aif #moi
Registered, Self-Regulated, Fast, Cost-effective
The new Alternative Investment Funds Law 2018 (“AIF Law 2018”), regulating AIFs in Cyprus, has introduced a new category of AIFs, the Registered AIFs (“RAIFs”). This has been a long awaited development by the Cyprus Fund Industry, which significantly strengthens the country’s efforts of becoming a funds hub.
A RAIF will be registered in a Registry held by Cyprus Securities Commission but will neither be authorized nor regulated directly by CySEC. Responsible for the regulatory compliance of the AIF will be its External Manager, who should be a licenced AIF Manager (“AIFM”).
In addition to its management functions, the AIFM shall be responsible for the supervision and monitoring of the RAIF, by providing certain mandatory services, such as: risk management, compliance/AML and internal audit. The RAIF will still be considered as ‘AIF’ by virtue of the Law, offering new opportunities for a quick and cost-effective fund launch, but can be marketed only to professional or well-informed investors. It may be organised in any legal form available under Cyprus Law, it can be open or closed ended and be established as an umbrella structure, with multiple compartments.
There are no restrictions in its investment strategy, however the RAIF cannot be set up as Loan Origination, Fund of Funds or Money Market Funds.
Third country AIFMs will also be able to register RAIFs to CySEC, provided that their country of establishment has granted passporting rights pursunt to the AIFMD.
RAIFs may also use EU marketing passport via its AIFM.
A RAIF will be registered in a Registry held by Cyprus Securities Commission but will neither be authorized nor regulated directly by CySEC. Responsible for the regulatory compliance of the AIF will be its External Manager, who should be a licenced AIF Manager (“AIFM”).
In addition to its management functions, the AIFM shall be responsible for the supervision and monitoring of the RAIF, by providing certain mandatory services, such as: risk management, compliance/AML and internal audit. The RAIF will still be considered as ‘AIF’ by virtue of the Law, offering new opportunities for a quick and cost-effective fund launch, but can be marketed only to professional or well-informed investors. It may be organised in any legal form available under Cyprus Law, it can be open or closed ended and be established as an umbrella structure, with multiple compartments.
There are no restrictions in its investment strategy, however the RAIF cannot be set up as Loan Origination, Fund of Funds or Money Market Funds.
Third country AIFMs will also be able to register RAIFs to CySEC, provided that their country of establishment has granted passporting rights pursunt to the AIFMD.
RAIFs may also use EU marketing passport via its AIFM.
AIF GENERAL CHARACTERISTICS |
Licensing |
Registered with CySEC / Not Licensed |
Legal Forms |
|
Eligible Investors |
May only be marketed to “Professional” and/or “Well-Informed” investor |
Number of Investors |
Unlimited |
Min. Capital requirement |
N/A |
Listing / ETF |
May be listed or traded on a regulated market or MTF |
Investment Manager |
Required / Alternative Investment Fund Manager (AIFM) |
Assets under management |
Cannot be set up as Loan Origination, Fund of Funds or Money Market Funds |
Depositary |
Required to appoint a local Depositary |
Umbrella Structure with Segregated Compartments |
Yes |
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