Guest article: Quick guide on how to set-up a Luxembourg SIF (Specialised Investment Fund)

Quick guide on how to set-up a Luxembourg SIF (Specialised Investment Fund)

The following sections will give you a short overview on how to set up a SIF:

Drafting the SIF prospectus| The very first step to set-up a SIF will be to draft the SIF prospectus. In order to achieve this first milestone, there are different sub-steps to be undertaken.

Contract a Luxembourg law firm to draft the prospectus and the articles of association. A Luxembourg lawyer shall be appointed to draft and or review the fund legal and contractual documentation and file such document to the Luxembourg Financial Authorities (the ‘CSSF’).

Responsibility: Initiator of the SIF with the support of Carey S.A.

Provide the different information required for the drafting of the SIF prospectus. Such information relates mainly to a) the SIF’s investment strategy, restrictions and risk guidelines, b) operational set up of the fund (below).

The SIF will need to appoint the following providers:

• • • • • • a central administration agent located in Luxembourg (responsible for the SIF domiciliation, net asset value computation and accounting, the regulatory reporting, the registrar and transfer agent function as well as the day-2-day administration) like Carey S.A.

• • • • • • a custodian bank located in Luxembourg responsible for the safekeeping of the SIF’s assets.

• • • • • • an independent auditor.

The board members of the SIF shall also be selected. A minimum of 3 board members shall be planned including local directors (such local directors may be either provided by Carey S.A. or selected among local independent directors). The SIF’s board members will have to obtain CSSF approval (such process will occur in the same time as the below filing process, on the basis of CV justifying the expertise in the specific investment field of the SIF, criminal records, etc.).

Step I Summary

• • • • • • Expected time line: Between 4 to 6 weeks.

• • • • • • Expected cost: From EUR 20,000 excluding taxes (Such costs relates mainly to the legal work and shall include the filing process to the CSSF as well). These set-up costs may be amortised within the fund over a period of 3-5 years.

• • • • • • Parties involved: The initiator of the SIF, the contracted law firm and a local coordinator (such role shall be undertaken by Carey Group).

Week I | Law Firm to be selected | Main features of the prospectus being discussed

Week II-III | Selection process of SIF providers

Week IV-VI | Release of the draft Prospectus to be filed

Filling of the SIF prospectus to the Luxembourg Financial Authorities (the “CSSF”)

Once the drafting of the SIF legal and contractual documentation have been finalised and all required filing documents have been made available, the contracted law firm will file the SIF documentation to the CSSF for authorisation.

Note: the prospectus should only be filed together with the other documents composing the application file: articles of association, main services agreements, subscription agreement, CV and affidavit of the managers, etc. 

The CSSF will issue a first feedback and may ask questions/additional information on the draft prospectus. Once the different outstanding points have been cleared, the CSSF will issue an oral and then written confirmation of its agreement (formalised by the prospectus being granted a written CSSF VISA).

Responsibility: The contracted law firm with the support of Carey S.A

Step II Summary

• • • • • • Time line: Between 4 to 6 weeks (depending on the number of additional information requested by the CSSF), this can also take up to several months.

• • • • • • Expected cost: Legal fees are included in step 1 provision + CSSF filing duty from EUR 3000 (stand alone SIF).

note: in addition to the initial filing duty, an annual duty of the same amount (EUR 3,000/EUR 6,000) shall be due to the CSSF

• • • • • • Parties involved: The contracted law firm, the initiator of the SIF, and a local coordinator (such role shall be undertaken by Carey S.A.).

Week VI | Filing of SIF Prospectus

Week VII | Preliminary feedback from the CSSF

Week IX | Filing of any additional information required. Approval received from the CSSF.

Incorporation Process

Once the SIF documentation has been approved, the SIF will be incorporated through an extraordinary general meeting of the shareholders in front of a Luxembourg Notary.

Responsibility: The contracted law firm and the central administration agent (Carey S.A).

Step III Summary

• • • • • • Expected time line: Between 2-3 days.

• • • • • • Expected cost: Legal fees are included in step 1 provision. + notary costs about EUR 3,000 to 5,000.

• • • • • • Parties involved: The contracted law firm, the notary, the central administration and the Company’s shareholder(s).

Week X | Management of the Extraordinary General Meeting of the Shareholder

Initial Closing

Upon fulfilment of the above steps, the SIF will be up and running. A first board of directors meeting will be held asap in order to approve and endorse the Prospectus, define and validate the initial closing period of the SIF, formally appoint the different providers of the SIF and take any appropriate resolutions regarding the day-2-day operations of the fund.

Responsibility: The board of Directors of the SIF and the central administration agent.

Indicative Timeline Summary

Week 1 | Law Firm to be selected |Main features of the prospectus being discussed

Week II | Selection process of SIF providers

Week IV-VI | Release of the draft Prospectus to be filed

Week VI | Filing of SIF Prospectus

Week VII | Preliminary feedback from the CSSF

Week IX | Filing of any additional information required. Approval received from the CSSF

Week X | Management of the Extraordinary General Meeting of the Shareholder

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