A UCI – undertaking for collective investment – is a type of investment fund in Luxembourg that offers investors the possibility to generate income, access a portfolio with multiple investments and share the associated costs. Our lawyers in Luxembourg can help you open an UCI and manage your investments.
Three of the most important characteristics of an undertaking for collective investment in Luxembourg are:
-the collective investment of funds;
-the capital is raised from multiple investors;
-the capital is invested following a specific investment policy and for the benefit of the investors.
The structure of an UCI in Luxembourg
There are various options available for the creation of an UCI in Luxembourg. UCIs can take the form of Undertakings for Collective Investment in Transferable Securities (UCITS) or the form of Alternative Investment Funds (AIF). UCITS can be marketed to all investors in the EU/EEA countries. AIFs need to be marketed according to special requirements for AIF managers.
UCIs in Luxembourg can be set up as a common fund (FCP) or as an investment company with variable capital (SICAV) or an investment company with fixed capital (SICAF). A common fund (FCP) has no legal personality and must be managed by an authorised management company. Our Luxembourg lawyers can help you open a SICAV or a SICAF.
UCIs need to have a board of directors and it can be tax transparent (for FCP) or non-tax transparent (for SICAV and SICAF). Regardless of the basic structure chosen for the UCI, investment funds need to comply with VAT regulations in Luxembourg.
You can also find out how to open a UCI fund from the video below:
The organization of an UCI in Luxembourg
An UCI in Luxembourg needs several service providers who have various duties and who are appointed accordingly. The main service providers are:
-a sponsor, promoter or initiator;
-a management company;
-a portfolio manager;
-an investment adviser and an administrator
-a domiciliation agent;
-a distributor and a nominee.
The organizational model can include other service providers. For example, the financial statements of an UCI must be audited by an independent auditor in Luxembourg. The organizational model depends on a number of factors and it is decided at the time of the incorporation.
UCIs in Luxembourg need to be authorised by the CSSF (Commission de Surveillance du Secteur Financier).