Irish funds industry plans get government approval

Ireland’s finance ministry has approved, in principle, the development of legislative proposals for a new corporate structure for the funds industry which will meet US check the box requirements and reduce administrative costs on funds.

The Irish Funds Industry Association (IFIA) welcomed the move. The proposals for the SICAV legislation are aimed at further developing the funds industry and promoting employment and business opportunities.  

Ken Owens, Chair of the IFIA, said the organization and the Department of Finance have been working on the proposal for some time.

“Last week we met hundreds of American managers on our roadshow in the US and this news is of particular interest to them. In 2011 Ireland was the managers’ European domicile of choice, attracting twice as much in new UCITS monies as all others put together. This new structure will make Ireland even more attractive to managers all over the globe, but especially in the US.”

Michael Jackson, Chair of the Legislative Sub-Group of the IFSC Funds Group, which played a leading role in securing the change, said that the move emphasized Government support for the funds industry, which was playing an important role in the creation of new jobs in Ireland.

“We look forward to working closely with the Central Bank and the relevant Government departments to introduce a market-leading corporate structure which continues to combine high standards of governance, transparency and investor protection with an ability for investment managers to design and distribute Irish products which are capable of meeting the varied demands of their global investor base,” he said.

Investment funds in Ireland structured as corporates are usually incorporated as public limited companies (“plcs”) under Part XIII of the Companies Act 1990. While plcs continue to be an extremely effective and popular structure, the Irish funds industry believes managers will benefit from the creation of a structure designed specifically for investment funds, not subject to rules designed for other forms of company.

The industry is confident that, in addition to providing a more flexible corporate vehicle, the new structure will result in a reduced administrative burden and reduced costs. Plcs will continue to be available to promoters who wish to use them and conversion to the new structure will be optional for existing plcs.

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