Tue, Aug 4, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

British Virgin Islands to introduce new category of investment manager license for smaller hedge funds

Wednesday, December 05, 2012
Opalesque Industry Update: Ogier British Virgin Islands (BVI) announced today that the BVI Financial Services Commission (FSC), the jurisdiction’s financial regulator, has published guidelines for a new type of investment management licensing regime targeting non-institutional investment managers of small and mid-sized investment funds.

The Investment Business (Approved Managers) Regulations, 2012 – known as the Approved Managers Regulations – come into force on 10 December 2012. The regime will provide eligible investment managers of BVI funds opting to also domicile their investment management vehicles in the jurisdiction with a streamlined regulatory framework, acknowledging both the sophistication of investing into such funds and the lower systemic risk posed by these funds to the global financial system.

“We see the Approved Managers Regulations as particularly appealing to start-ups or smaller investment managers that want to set up and manage funds in the most efficient and effective way possible, given their size and investor base,” said Ogier BVI Corporate and Investment Funds Partner, Simon Schilder, who has also been actively involved in the private sector consultations for these new regulations. “We believe the new regime will be an appealing product for eligible investment managers and will represent a cost effective option which is, at the same time, in tune with current regulatory requirements and international standards for the oversight of investment managers.”

Growth Opportunities for Small Hedge Funds

Recent analyses show the small hedge fund market as growing, despite difficulties these funds typically face in securing capital. A report by Barclays Capital identified a trend beginning in 2011 towards an increasing share of allocations going to funds with less than $1 billion in assets. The Barclays research shows this trend will continue throughout 2012. The research also reported investors indicating a 77-percentage point tilt in favor of increasing allocations to small funds, compared with a 10-percentage point tilt toward large funds (with assets under management of $5 billion).

Key Requirements for Eligibility Under the Approved Managers Regulations

Among the requirements for eligibility under the Approved Managers Regulations are for the investment manager to:

  • Be a BVI company or limited partnership;
  • Act as investment manager or advisor to either a BVI licensed private or professional fund; a closed-ended fund domiciled in the BVI with characteristics substantially similar to either a BVI licensed private or professional fund; or a foreign fund investing substantially all of its assets in a BVI domiciled fund;
  • Satisfy the FSC’s fit and proper test;
  • Maintain, in the case of open-ended funds, aggregate assets under management of US$400 million and, in the case of closed-ended funds, aggregate capital commitments of US$1 billion; and
  • File an application for approval not less than seven days prior to the intended commencement of business.

A full briefing of all the provisions of the AMR is available via the following link: http://www.ogier.com/Publications/library/Pages/InvestmentBusiness(ApprovedManagers)Regulations,2012.aspx

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Same day reporting and the evolving role of fund administrators[more]

    By: Scott Price, Head of Business Development and Client Management for North America, Maitland Ernst & Young’s latest glob

  2. Activist News - Celgene says patent-fighting hedge fund manager wants to short its shares[more]

    From Reuters.com: Celgene Corp, one of the world's largest biotechnology companies, has accused U.S. hedge fund manager Kyle Bass of attempting to profit from his attempts to wipe out several major drug patents through his Coalition for Affordable Drugs. The company asked the U.S. Patent and T

  3. Einhorn's Greenlight Capital hedge fund slumps 6.1 percent in July[more]

    From Reuters/Thefiscaltimes.com: Hedge fund mogul David Einhorn's Greenlight Capital slumped 6.1 percent in July and is now down 9 percent for the year after gold, one of the fund's top holdings, tumbled to five-year lows last week. Greenlight notified clients of its returns late on Friday, ac

  4. Cowen Group, Inc. to acquire Conifer Securities[more]

    Cowen Group, Inc. and Conifer Securities, LLC had announced the signing of a definitive agreement under which Cowen will acquire Conifer Securities, the prime services division of Conifer Financial Services LLC. The transaction, the terms of which have not yet been disclosed, was approved by the boa

  5. Cargill’s Black River Asset to shut down four hedge funds[more]

    Komfie Manalo, Opalesque Asia: Cargill Inc.’s $7.4 billion Black River Asset Management said it was closing four hedge funds with a combined $ 1 billion in assets and start returning investors money over the next several months, various media said. The hedge funds represent 15% of Black River’

 

banner