The Isle of Man Thursday launched a new dynamic and comprehensive funds proposition, developed to attract further funds business to the island to continue the growth of the island’s fund sector.
The regime offers new fund categories, including SF (specialist fund) and QF (qualified fund) products. It includes a major new focus on alternative funds in order to secure business for the incorporation, domiciliation and establishment of fund management operations in the Isle of Man.
Funds under administration in the Island are forecasted to double to $100 billion over the next three years.
The new initiative follows the publication of the Smith Report in February, conducted under the auspices of funds expert, Paul Smith, in consultation with the Isle of Man Funds Review Group. The Report announced the Island’s intention to position itself as the preferred location both for the incorporation, domiciliation and management of institutional funds in the global alternative funds industry.
The initiative will position the Island as a cost effective and zero tax location for fund managers to locate their middle/back office operations.
As a result of the Smith Report recommendations, Treasury Minister Allan Bell MHK will be taking three new orders of legislation to Isle of Man’s parliament in October, effective 1 Nov. They provide for the new specialist fund (SF), the new qualified fund and transitional/retention arrangements for existing experienced investor funds (EIF).
The SF is the fund category of choice for distribution to institutional and high net-worth investors, offering maximum flexibility on strategy and asset allocation, as well as existing benefits for fund operations in the Isle of Man. For example, a tax neutral environment for fund management, the SF offers a minimum initial subscription of $100,000. There is no requirement for any regulatory pre-approvals.
“The Isle of Man Government Treasury is delighted to launch this new initiative with the Isle of Man Fund Management Association,” says Brian Donegan, Isle of Man Finance. “The Island’s fund industry has grown immensely in the past five years, with funds under management and administration standing at $50.1 billion in June 2007. We anticipate that our new funds initiatives, when coupled with the Isle of Man’s existing taxation advantages, will treble this figure and position us as the jurisdiction of choice for fund management and fund administration operations.”