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Commission to increase Private Investment Fund options

Commission to increase Private Investment Fund options

Wednesday 21 April 2021

Commission to increase Private Investment Fund options


The GFSC is introducing new Private Investment Fund options with immediate effect.

In December, the commission published a consultation paper containing proposals to amend the PIF rules to allow more investor categories to take advantage of an "appropriately regulated" fund structure.

The GFSC says the proposals were unanimously welcomed by respondents and the commission has subsequently decided to amend the PIF rules with immediate effect. 

Whilst the current approach to registering a PIF will be retained, the revised rules will provide two new paths to enable a PIF to be created without an attached Protection of Investors Law (PoI) licensed manager.

To use the second path, all investors will have to meet qualifying investor criteria which are designed to protect more vulnerable investorsAt the time of application, the PoI licensed fund administrator will be required to provide confirmations equivalent to those currently provided by a fund administrator in respect of any Qualified Investor Fund application.

A third path will enable a PIF to be created "as a bespoke private wealth structure requiring a family relationship between investors."

All currently registered PIFs continue to be registered under the current “Path 1” regime, which remains available to those wishing to raise money from broader categories of investor.

"The implementation of these revised PIF rules [will] recognise the needs of the fund industry and its clients by introducing a greater degree of flexibility while continuing to ensure that appropriate levels of investor protection are observed," said the commission’s Director General, William Mason.

I am pleased to be able to announce In deciding to make these changes, the commission has listened to industry and other stakeholders, sought to ensure our regulation is proportionate to the needs to different investor groups and acted to ensure that the Bailiwick remains a good place to do business.”

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