T H E TO V E L G R O U P & A M S F I N A N C I A L G R O U P
Inside the approved manager regime Interview with Walter Reich & David Payne
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ince the Approved Manager Regulations were implemented in the BVI in 2012, smaller managers seeking a more simplified approval process and lighter touch regulatory framework compared to the Securities and Investment Business Act (‘SIBA’) have really benefited. Under the approved manager regime, start-up managers can choose to avail of the BVI’s incubator fund and approved fund products, both of which are designed to help build their track records without necessarily having to launch a BVI professional fund on day one. In that sense, the approved manager enables smaller managers to establish a structure on a cost-effective basis, says Walter Reich, founder of Tovel Investments Ltd. “For a lot of people looking at the BVI, the approved manager often ends up being the most logical choice.” Tovel is a boutique group providing directorship, accounting, investment management and corporate governance services. Specifically, Tovel Investments has a full BVI investment management license and Tovel Consulting provides directorship/mind and management related services with focus on approved and licensed fund managers and to the underlying funds. Services include assisting clients in establishing fund structures including licensed and/or approved manager entities. According to the latest statistical bulletin published by the BVI Financial Services Commission in June 2019, there were 255 approved investment managers and 108 approved funds; this compares to 938 professional funds. “The approved manager is a flexible vehicle, especially for the clients we work with such as newly established investment managers,” says David Payne, Director, AMS Financial Group, which provides corporate, trust, fiduciary, captive insurance and legal services 28 | www.hedgeweek.com
to investment firms, including independent directorship services. AMS is also an affiliate of Circle Partners, an independent fund administrator with offices in the Cayman Islands, and across the EU, the Americas and Hong Kong. “The way the regime was drafted, it allows fund sponsors to run both BVI and foreign funds, both closed-ended and open-ended, up to an AUM limit of USD400 million (USD1 billion for closed-ended funds). “Combining the approved manager with an approved fund has been quite a success. It has been rewarding to see the interest in these products increase since their launch especially considering the time spent by various BVI hedge fund focused committees in trying to develop the right product based on what we were hearing from prospective clients.” AMS sets up the legal structures for approved funds and approved managers and recommends services such as independent directorships, and over the years the firm has developed a productive relationship with Tovel, with both firms able to provide the key functionaries required in the overall structure who have relevant experience and who can provide the required independence. “At Tovel, we have a great team of hedge fund experienced individuals. Clients are pleased to know that experienced and qualified individuals are available locally in BVI to act as director, secretary, trader, compliance officer and accountant as circumstances require especially given the ever changing global regulatory environment. We all have relevant hedge fund backgrounds so we can provide a proper value-added service,” explains Reich. Not every investment professional is going to fit the approved manager regime and it is the job of specialist providers such as AMS to weed out any potentially ill-fitting prospects. BVI REPORT | Nov 2019
