LUXEMBOURG PRIVATE EQUITY AND VENTURE CAPITAL

Luxembourg Private Equity And Venture Capital-Free PDF

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Why Luxembourg,QQ Political legal and fiscal stability. QQ State of the art legal and regulatory environment. QQ High regulatory and investor protection standards. QQ Solid financial sector supervision,QQ Rapid and innovative responses to new trends. QQ Highly international in terms of origin of financial institutions and. fund initiators clients population and workforce, QQ Diversified offer of financial products and services. QQ Europe s number one investment fund centre, QQ Unique concentration of investment fund industry experts in all. aspects of product development administration and distribution. QQ Unrivalled know how in cross border investment funds business. QQ Top notch market infrastructure for securities trading. clearing and settlement, This brochure purports to provide general Luxembourg based service providers have.
background information on the set up as well built up teams experienced and specialised in. as the servicing of private equity and venture servicing the above mentioned private equity. capital investment vehicles in the Grand Duchy and venture capital investment vehicles. of Luxembourg Against this background they are today able to. offer a wide range of customised services in, In terms of set up of private equity and venture fund and acquisition structuring transaction. capital investment vehicles Luxembourg today advisory fund administration depositary and. offers a large variety of structuring opportunities audit services dedicated to private equity and. such as the investment company in risk capital venture capital investment vehicles. SICAR the specialised investment fund SIF,the reserved alternative investment fund RAIF. or any commercial company in particular an SCS,or SCSp qualifying as an AIF and or a holding. company like the soci t de participations,financi res SOPARFI as the case may be In. addition Luxembourg commercial companies, can also be set up as venture capital vehicle based.
on the European Regulation EU No 345 2013,the EuVECA. Table of contents, 1 Luxembourg a conducive environment for private equity and venture capital 4. 2 Private equity and venture capital in Luxembourg 6. 2 1 Typical Luxembourg private equity and venture capital structures 7. 2 2 General partners management 8,2 3 Substance and supporting industry 8. 2 4 Service providers 9,2 4 1 Administration 9,2 4 2 Depositary services 9. 2 4 2 1 Monitoring function 9,2 4 2 2 Safekeeping of assets 9.
2 4 3 Banking services 10,2 4 4 Legal tax and audit services 10. 3 Private equity and venture capital legal framework 11. 3 1 Schematic representation of principal choices to be operated. when implementing a private equity and venture capital structure 11. 3 2 Luxembourg private equity and venture capital unregulated and 12. regulated structures, 3 2 1 Non regulated standard commercial companies 12. 3 2 2 Directly regulated or indirectly supervised structures 13. 3 2 3 Disclosure requirements PRIIPs KID 14, 3 3 Features of Luxembourg private equity and venture capital vehicles 15. 3 4 Structuring by means of Luxembourg vehicles 20. 4 Luxembourg tax environment 23,4 1 Direct taxation of corporations 24. 4 2 Miscellaneous charges and fees 28,4 3 Personal taxation 28.
5 Accounting framework for Luxembourg private equity vehicles 31. 5 1 Accounting standards and audit requirements 31. 5 2 Valuation rules 31,5 3 Consolidation 32,5 3 1 Unregulated vehicles 32. 5 3 2 Regulated vehicles SICARs and SIFs 32,5 4 Profit repatriation 34. Appendix I Comparative table of legal structures 35. Appendix II Statistics 37,Appendix III Glossary 43. 1 Luxembourg a conducive environment for private equity and venture capital. Choosing the right location for the set up of The following features are Luxembourg s. private equity or venture capital operations strengths the combination of these strengths. and in particular private equity and venture makes Luxembourg a very attractive location. capital investment vehicles requires to take for private equity as well as venture capital. into consideration many different factors initiators. Political economic The political environment in Luxembourg is and diverse business community. stability very business friendly and conducive to An illustration is the special tax regime for. welcoming decision makers and entrepreneurs highly skilled workers aimed at attracting a. Attracting international players is considered specialised workforce in areas such as private. paramount in building an efficient business equity and venture capital. framework and economic growth and has,enabled Luxembourg to establish an innovative. A stable and rewarding The tax framework is considered among the taxpayers have a business friendly attitude and. tax environment most stable and rewarding in Europe for the quick and pragmatic approach to the. companies their shareholders and their requirements of international investors. employees This is a key component of Luxembourg offers a flexible and attractive tax. Luxembourg s development The tax regimes in full compliance with applicable EU. authorities lead a constructive dialogue with directives and regulations. Business friendly Luxembourg was one of the pioneers to of UCITS Luxembourg has taken advantage of. environment implement the AIFMD and has largely the opportunities given by the passport regime. leveraged on its long standing and recognised and has on that basis become the leading. UCITS experience to adapt the alternative jurisdiction in the world for retail cross border. investment fund industry to the new regulatory distribution. standards and marketing or placement regimes,With the introduction of the AIFMD and in.
Although the initial objective of the G20 and particular the AIFMD passport more and. the EU Commission was principally aimed at more Luxembourg AIFs have been distributed. regulating the alternative investment industry cross border. in order to control and avoid systemic risk the, AIFMD also entails a European marketing A considerable number of Luxembourg UCITS. passport for AIFM Once authorised in an EU management companies have also obtained. Member country these AIFMs can market the approval to act as AIFMs allowing them to. AIFs they manage to professional investors in manage both UCITS and AIF. all other EU Member countries In the context, Players on the Luxembourg GPs private equity venture capital houses They provide offices to conduct business from. private equity and venture or their subsidiaries as well as a range of additional services to. capital scene Whilst historically a local presence in private equity and venture capital houses that. Luxembourg was limited mostly to smaller are conducting business out of Luxembourg. and or emerging GPs many large international Luxembourg is home to both administrators. houses have set up and conducted business out specialised in private equity or venture capital. of Luxembourg since the middle of the last as well as many more generalist administrators. decade with a considerable and growing local that are often part of larger financial services. substance groups Governance standards of private equity. and venture capital investment vehicles set up, Private equity and venture capital in Luxembourg have undergone a significant. administrators evolution with enhanced governance having. These service providers offer domiciliary been made a priority by the supervisory. accounting trust services and since the authority and industry stakeholders themselves. introduction of AIFMD in 2013 depositary Today there is a high number of skilled. services for funds with a 5 year closed for independent directors available to serve private. redemption period investing in private equity equity as well as venture capital investment. and venture capital to the extent required vehicles. 2 Private equity and venture capital in Luxembourg. Luxembourg offers a platform of services and The EuVECA Regulation EU No 345 2013. structuring opportunities to the private equity provides harmonised requirements for qualified. as well as the venture capital industry Products venture capital funds that intend to invest at. include competitive structures for setting up least 70 of their aggregate capital. private equity and venture capital funds such contributions and uncalled committed capital. as the investment company in risk capital in assets that are qualifying investments. SICAR or the specialised investment fund EuVECA funds can be internally or externally. SIF Luxembourg has thus emerged as a managed and managers marketing funds to. prime jurisdiction for the structuring of private professional investors benefit from an EU wide. equity and venture capital acquisitions and distribution passport. financings,The RAIF Reserved Alternative Investment. Besides the SIF and the SICAR Luxembourg has Fund structure which became available in the. built up its market share in private equity and summer of 2016 allows private equity and. venture capital funds thanks to its non regulated venture capital fund initiators to set up. special purpose companies such as the Luxembourg domiciled funds that are not. SOPARFI the financial participation company subject to regulatory approval by the. which are used for private equity venture capital Luxembourg supervisory authority the. acquisitions and financings alike A SOPARFI is Commission de surveillance du secteur. typically used for holding and financing private financier the CSSF This option permits. equity and venture capital investments It may the achievement of a significantly enhanced. thus equally serve as an SPV a joint venture time to market for new fund launches. vehicle or more rarely a fund vehicle itself in However a RAIF must be managed by an. which case it may qualify as AIF Other types authorized AIFM. of commercial companies such as the SCA,the SCS and the SCSp qualifying as AIF are.
frequently used to structure private equity and,venture capital funds. 2 1 Typical Luxembourg SICARs RAIFs SIFs EuVECAs and SOPARFIs Besides the existing SCS the AIFM Law. private equity and can take a large variety of legal forms available introduced a new legal form the Special Limited. venture capital under Luxembourg law and thus accommodate Partnership SLP or in French the Soci t en. structures any set of tax and governance requirements Commandite Sp ciale SCSp a limited. both stemming from the investors as well as partnership without legal personality This legal. the initiators perspective that typically arise form is comparable to the common English law. in the context of setting up private equity or limited partnership and can also be set up under. venture capital investment vehicles as well as in a specific regulatory wrapper regime such as the. special situations e g master feeder structures SICAR SIF RAIF or EuVECA regimes. acquisition structures etc,Since August 2016 the Simplified limited. The table below compares the five most company in French the Soci t par Actions. commonly used available structures on key Simplifi e SAS has offered an alternative legal. criteria when choosing the right form for a form that can be used for any of the regulatory. private equity or venture capital investment wrappers SICARs RAIFs SIFs EuVECAs and. vehicle also SOPARFIs,Flexibility Diversification investment limits. SIFs and RAIFs are eligible for all asset classes SIFs and RAIFs as well as EuVECAs must. SICARs and RAIFs taking the features of a invest in a diversified asset portfolio and or. SICAR are exclusively eligible for risk capital are subject to certain investment limits. investments SICARs and RAIFs taking the features of. EuVECAs require an investment of the a SICAR are not subject to diversification. majority of their assets in venture capital requirements. investments SOPARFIs have no constraints in terms of. SOPARFIs benefit from flexible provisions of investment policy. Luxembourg corporate law and offer,flexibility in structuring debt and equity. Structuring Regulation, SIFs RAIFs SICARs EuVECAs and SICARs EuVECAs and SIFs are subject to.
SOPARFIs may be organised using different authorisation before taking up their activity. legal forms available under Luxembourg and are subject to ongoing supervision. corporate law private limited liability RAIFs are not subject to any prior. company SARL public limited liability authorisation but remain subject to indirect. company SA corporate partnership limited supervision via their authorised AIFM. by shares SCA limited partnership SCS SICARs SIFs EuVECAs and RAIFs are. special limited partnership SCSp etc subject to certain minimum disclosure. SICARs SIFs EuVECAs and RAIFs may in obligations, principle be organised in a fiscally neutral SOPARFIs are not subject to regulation. manner to the extent due to their legal form though they may qualify as an AIF and thus. they qualify as fiscally transparent may be subject to indirect supervision and. SIFs RAIFs SICARs EuVECAs and certain minimum disclosure obligations via. SOPARFIs may in principle benefit from all or their AIFM as well. part of Luxembourg s double tax treaty,network to the extent due to their legal form. they are not fiscally transparent,2 Private equity in Luxembourg. 2 2 General partners In order to set up a corporate partnership The GP may delegate some of its powers to. management limited by shares Soci t en Commandite agents that it may in principle freely determine. Private equity and venture capital in Luxembourg 6 2 1 Typical Luxembourg private equity and venture capital structures 7 2 2 General partners management 8 2 3 Substance and supporting industry 8 2 4 Service providers 9 2 4 1 Administration 9 2 4 2 Depositary services 9 2 4 2 1 Monitoring function 9 2 4 2 2 Safekeeping of assets 9 2 4 3 Banking services 10 2 4 4 Legal tax and audit

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