Direct access to UK and EU capital
Future-proofing in view of Brexit
Six weeks to set-up
Limited remuneration disclosure
A recognised path

Jersey–based fund managers are located in a ‘third country’ from a European Union (EU) perspective and therefore the full scope of The Alternative Investment Fund Managers Directive (AIFMD) need not apply. This means that they may not be required to comply with certain more onerous elements, such as reporting and disclosure of remuneration. Importantly, the benefits of a Jersey manager can apply wherever the funds themselves are domiciled, be it in Jersey or elsewhere. Put simply, access to Europe through the National Private Placement Regimes (NPPR) using a Jersey manager is a well-established model offering clear advantages.

NPPR is a recognised path and a model that has worked, and continues to work extremely well. At the end of December 2018, there were 168 managers in Jersey marketing over 314 funds into the EU alone using the NPPR route (Jersey Financial Services Commission, JFSC).

Figures from Preqin show that 55% of European investors in alternative real estate and 62% in private equity are based in the UK, Switzerland or the Netherlands. From 2019, only one of those three countries will be in the EU, therefore the ongoing onerous regulation and expense in order to access only one or two EU Member States will be disproportionate when a simpler alternative is available. The reality is that few managers need blanket access to all EU Member States. In cases where they do, then an onshore option works best, but with European Commission figures suggesting that 97% of managers actually market to three EU markets or less, then private placement offers a very credible, fast, cost-effective and sensible option.

A Global Hub

For decades, Jersey has set itself apart as a reputable, centrally located jurisdiction for investors from key global markets. Jersey provides excellent third country access to the EU market through the use of NPPR to non-EU countries.

Speed to Market

The process, including regulatory applications and approvals, takes weeks not months, with the regulator committing to approve this type of fund launch in six weeks.

Cost effectiveness

offers better returns: Jersey’s streamlined regulatory regime can result in lower running costs and higher investor returns in a jurisdiction free from value added tax (VAT).

Regulatory certainty and innovation

The JFSC is an approachable, globally respected and co-operative regulator, supervising pragmatic regulation that meets international standards (the International Monetary Fund, the International Organisation of Securities Commissions, the European Securities and Markets Authority and the Financial Action Task Force).

Tax simplicity

Jersey offers a tax-neutral environment with no VAT or capital gains tax (CGT) and is not reliant upon a complex system of tax rulings, exemptions and deductions, hybrid financing or double tax treaty networks.

Political and economic stability

Jersey is a politically and fiscally autonomous and stable British Crown Dependency with a secure, special relationship with the United Kingdom (UK), but outside of the UK and outside of the EU. We are therefore perfectly positioned with regards to Brexit developments.

Remuneration

To obtain a full AIFMD ‘passport’ in Europe, the manager is required to disclose remuneration details of key employees including partners. If a manager does not need to market on a pan-European basis, there is no great benefit to an AIFMD passport and a lighter approach is permissible under the NPPR.

Assets under administration in Jersey

Jersey AUA up 70% over the past five years

South Africa promoters = the eighth biggest source of assets by promotor origin

Elliot is focussed on defining the strategy and execution of marketing Jersey as both a domicile and destination for hedge and private equity management companies and funds based in the UK, US, Switzerland and Europe.

Allan Wood › Global Head of Business Development
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Allan joined Jersey Finance as Business Development Director following five years with Barclays International in Jersey. He has more than 25 years’ financial service experience in Jersey and the UK. Prior to Jersey Finance Allan was Vice President and leader of the Jersey International business within Barclays Wealth & Investment Management division based in Jersey.