EVERSHEDS SUTHERLAND
Choosing a domicile – a keystone decision By Ben Watford
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electing the fund domicile which best suits an emerging hedge fund strategy is one of the key decisions facing investment managers ahead of launch. The choice they make at the outset will have far reaching regulatory and tax consequences throughout the life of the fund. Law firm Eversheds Sutherland notes that in making this choice, a manager needs to take into account the preferences and location of the fund’s seed and target investors. Historically, hedge fund managers have EUROPEAN HEDGE FUND STARTUP GUIDE | Mar 2020
favoured offshore, low tax jurisdictions like the Cayman Islands, but more recently the dedicated fund vehicles available in onshore domiciles like Luxembourg and Ireland have been attracting more attention. This is a particularly appealing option for investment managers hoping to market to investors in the EU, as funds established in EU Member States are eligible for the AIFMD marketing passport, which grants continent wide market access using the fund’s home state’s authorisation. When deciding whether to set up the www.hedgeweek.com | 15
