Message
X

New and exiting BVI products

June 30, 2015 - by Nida U.

Incubator Fund and Approved Fund

New and exiting BVI productsx


BVI Financial Services Commission (FSC) already offers a wide range of investment business licenses regulating private, professional and public fund recognitions and registrations. However not all the start-ups have the start-up capital, time or qualification to undergo the Securities and Investment Business Act (SIBA) licensing procedure.

These two new products are some good news that will indeed attract many start-up investment managers that are interested to start open-ended funds, especially since these products are lightly regulated, flexible, cost efficient and turnaround for the application review is much faster.

I find this somewhat supporting form the FCS to encourage, support and guide those smaller start-ups, by creating these new two categories – “Incubator Fund” and “Approved Fund”.

Incubator Fund:

Incubator fund is suitable for managers who are interested to start an investment fund with sophisticated investors, providing the chance for setting up a cost efficient and lightly regulated legal entity.

If the fund succeeds, provisions to apply for private or professional fund, in case the fund does not succeed it is also possible to convert to a regular company.

Key features are:

  • Net assets of the fund must not exceed USD 20,000,000 (or its equivalent in other currency)
  • Total number of investors is limited to 20
  • Investors initial investment must be no less then USD 20,000
  • No manager, administrator, custodian appointment is required
  • No audit requirements
  • The Incubator fund can only be approved for a period of 2 years. Extension of 12 month is available, however when application for extension is requested subsequent application for licensing under SIBA has to be filed for private, professional or approved fund.

Approved Fund:

Approved Fund is somewhat similar to a private fund, however is lighter regulated and costs for setting same up are much lower. This type of fund is targeted for friends and family, has higher net asset value threshold and no limit to the period of approval.

Key features are:

  • Net assets of the fund must not exceed USD 100,000,000 (or its equivalent in other currency)
  • Total number of investors is limited to 20
  • Requirement for administrator
  • No manager, custodian appointment is required
  • No audit requirements

For guidelines refer here

Thank you for reading my post! And you are welcome to leave comments, feedback, suggestions for other posts or contact me for more information.

Add a comment




image

Offshore Publications

 Subscribe in a reader

Subscribe

Enter your email address below to subscribe to our newsletter.



Categories