“The PIF” and the “Family PIF” are innovative and flexible fund structures offering speed to market in a well regulated jurisdiction.
As regulated entities, they must meet the definitions of a Collective Investment Scheme under the Protection of Investors (POI) (Guernsey) Law, 2020.
Benefits
A straightforward, streamlined application process with the regulator, the Guernsey Financial Services Commission (GFSC).
Regulatory approval can be obtained in 24 hours.
Flexibility on structure - the fund can be open or closed-ended suitable for GP/LP structures as well as limited and protected cell companies.
Supports public and private investments as well as innovative and emerging asset classes and mandates.
No prescribed minimum or maximum size of the fund or underlying investments, and no upper limit to the number of qualified private investors.
Can attract global capital and may be marketed internationally, including into the EU under AIFMD and NPPR provisions.
Low set-up and ongoing management costs. guernseyfinance.com
The Private Investment Fund
The PIF
Available for qualifying professional investors. This includes UK and EU professional clients, and US accredited investors, experienced investors, knowledgeable employees and high-net-worth investors, able to evaluate and bear the relevant investment risk.
A Guernsey POI licensed manager is optional to support or enable qualifying investor status.
A POI licensed administrator is mandatory, and must make regulatory declarations.
There is no upper limit on the number of qualified private investors.
Appointing an auditor is optional. This enables flexibility for institutional investors and emerging managers.
The PIF can be used by asset managers with a professional and sophisticated base.
The Family PIF
Family PIF
S
uitable for families and family offices. Investors must share a familial relationship or be an eligible employee of the family. A common sense approach is applied to defining this.
The PIF cannot be marketed outside of the family.
Optional licensed manager and optional audit, although the fund’s administrator must demonstrate that all investors are family members.
St Peter Port, Guernsey
Case Studies
Using the PIF to enable generational wealth flows within a family
Whilst ultimately owned by the primary family structure, a family utilised the PIF to segregate assets into vehicles that enable different investment strategies in addition to varied control mandates to be implemented.
For example, some offering full control, whereas others under a discretionary mandate, involving advisors for key decisions. This enabled the smooth transition of wealth, from one generation to the next.
Using the PIF to enable PE investment into European businesses
A UK-resident non-domiciled individual was advised to establish a Guernsey Trust, prior to becoming UK-domicile for IHT. The individual also wanted to launch a private equity fund to invest into European businesses.
As part of this, he wanted to also establish an incentivisation structure for the professionals running the PE fund. The LP was in one trust, and the GP was in another trust.
After running the operation successfully for 2 years initially, the client then invited members of his family to join the structure, via the Family PIF.
Kerrie Le Tissier, Client Director, Highvern
Using the PIF to streamline pooled investments
The PIF was recently selected by a small group of experienced investors who had for many years invested personally as an investment club.
Seeking to capitalise on their strong long term returns, they opted for a Guernsey Private Investment Fund due to Guernsey’s strong regulatory regime and reputation.
Through forming the fund structure they were able to formalise the investment processes and better manage a single pool of investments.
