Valsen Fiduciaries Funds

Luxembourg Specialized Investment Fund (SIF)

The Commission de Surveillance du Secteur Financier (CSSF) is a public institution which supervises the professionals and products of the Luxembourg financial sector. It supervises, regulates, authorises, informs, and, where appropriate, carries out on-site inspections and issues sanctions.

About Luxembourg Specialized Investment Fund (SIF)

The SIF is a regulated, operationally flexible and fiscally efficient investment fund for an international qualified investor base. Investment in a SIF is reserved for “well-informed” investors, comprising institutional investors, professional investors and investors who confirm in writing that they are a “well-informed” investor and who either invest the minimum stated capital (EUR 1,250,000) or has been assessed by a credit institution, investment firm or management company which certifies the investor’s ability to understand the associated risks of investing in the SIF.

Luxembourg Specialized Investment Fund (SIF) Legal Requirements

Requirements Description
  1. Applicable legislation
SIF Law of 13 February 2007
  1. Supervising Authority
Commission de Surveillance du Secteur Financier (CSSF)
  1. Corporate vehicle permitted

Common Fund (FCP)

Investment Company-variable capital (SICAV)

Investment Company-fixed capital (SICAF)

Limited Partnership

  1. Share capital or equivalent
    • Minimum subscription
EUR 1,250,000
    • Minimum investors
None
  1. Directors / Partners / Trustees
    • Minimum number
2
    • Corporate Directors / Partners / Trustees allowed
Yes
    • Local Directors / Partners / Trustees required
No
  1. Fund functionaries required
    • Custodian
      • Custodian required
Yes
      • Local custodian required
No
      • Eligible custodian

Licensed Financial institution

Licensed Trustee services provider

Any other person as the authority may approve

    • Fund manager / Investment manager
      • Fund manager required
Yes
      • Local fund manager required
No
      • Fund manager requires to be licensed
Yes
      • Eligible fund manager
A common fund has no legal personality and thus must be managed by a management company.
    • Fund administrator
      • Fund administrator required
Yes
      • Local fund administrator required
Yes
      • Eligible fund administrator
Luxembourg SIFs must appoint a depositary which is responsible for both the safekeeping of assets and the supervision of the fund and, if applicable, its management company.
    • External auditor
      • External auditor required
Yes
      • Local external auditor required
Yes
      • Eligible external auditor
Luxembourg statutory auditor with appropriate professional experience.
  1. Asset Requirements
    • Restriction on type of asset class invested
None
    • Asset diversification requirements
None
    • Limitation on size of the fund or total assets under management
None
  1. Local physical office required
No
  1. Prospectus / Offering Memorandum required to be filed
Yes
  1. Eligible for listing
Yes
  1. Estimated license processing duration
3-6 months

Ongoing Obligations

Requirements Description
Monthly obligations
Office Required
Quarterly obligations
None
Annual obligations
Submit annual audited accounts to CSSF for the financial year end
Other obligations

Notify CSSF of any of the following changes:

Change in the registered office address

Change of its agent in Luxembourg

Change in name or address of-

  • each director of the fund, if the fund is a company
  • each trustee of the fund, if the fund is a trust
  • each general partner of the fund, if the fund is a limited partnership.

Appointment, resignation or removal of a Director or officer

Tax Obligations and Other Exemptions
Requirements Description
Business Tax
Investment funds created under the AIF Law pay an annual subscription tax of 0.01% of their net asset value on the last day of every calendar quarter.
Withholding Tax
No withholding tax upon distribution to investors unless EU Savings Directive applies.
Net Worth Tax
Not subject to net worth tax
Subscription Tax
Certain money market and pension funds or AIFs investing in other funds which are already subject to subscription tax are exempt from subscription tax.
Capital Duty
No capital duty applies on incorporation of the corporate form (except a registration duty of €75)
Value Added Tax (VAT)
No VAT on Management services – except mere technical services – provided to a AIF are exempt from Luxembourg VAT
Stamp duty Act
Mutual funds are exempt from payment of stamp duty

Benefits of a Luxembourg Specialized Investment Fund (SIF):

  • Internationally recognised investment fund industry;
  • Reputable regulatory environment owing to its accessibility, knowledge and responsiveness of the regulator;
  • Political, economic and social environment’s stability as well as stable legal environment;
  • Favourable tax environment;
  • Attractive jurisdiction for institutional investors; and
  • Luxembourg investment funds benefit from a product passport, enabling them to be marketed to investors in the European Union (EU) and European Economic Area (EEA).