Luxembourg is set to modernise its legislation for investment funds under a proposal that will first be discussed later this week in the grand duchy’s parliament. The bill seeks to improve the various structuring options for investment funds.
The parliament budget and finance committee on Friday will discuss Bill 8183, which was submitted at the end of March. At the 5 May meeting the committee is due to appoint a rapporteur who will coordinate the legislation.
The bill plans to amend Luxembourg’s legislation for reserved alternative investment funds, for alternative investment fund managers, for Ucits funds, and for specialised investment funds. One of the changes will expand the different types of legal forms for vehicles used in Ucits funds and widen it up to partnerships other than a public limited company, or an SA, to entities structured as SCS, SCA, SCSp, SARL or cooperatives like SCoSA.
100,000 euro
The law also plans to amend Luxembourg’s definition of “well-informed investor” by lowering the investment threshold to 100,000 euro from 125,000 euro, said law firm Maples in its quarterly legal update for funds in Luxembourg and Ireland. This will bring Luxembourg in line with the standard applied in other EU member states.
Another proposed change will extend the period for reaching the minimum legal capital to 24 months from the current 12 months for alternative funds, and to 12 months from six months for Ucits funds. The new legislation will also clarify liquidation rules for management companies and AIFMs, and will allow AIFM’s to appoint agents.
The same legal package proposes to exempt European long-term investment funds, or Eltifs, from Luxembourg’s registration tax.