Gibraltar Funds

The funds industry in Gibraltar has seen rapid and impressive growth, establishing itself as a leading choice for individuals and companies looking for a leading jurisdiction in which to establish their investment funds. This expansion is underpinned by Gibraltar’s advantageous legal and regulatory framework, its political stability, and its tax-efficient environment, making it a serious option for fund establishment.

• Simplicity: We keep things simple in Gibraltar with two products that are easy to understand:

1. Regulated experienced investor funds (EIFs)
2. Unregulated private funds

• Speed to Market: There is no regulatory downtime when launching and EIF

1. EIFs are launched on the basis of a legal opinion
2. Once the fund is structured, you can commence operations

• Flexibility: No diversification requirements or limits on borrowing or leverage.

1. No restriction on asset classes (allowing for crypto funds)

• No AIFMD: Following Brexit, Gibraltar left the EU with the UK

1. Gibraltar EIFs can opt out of AIFMD, doing away with the €100m/€500m AIFMD thresholds

• Tax Neutral: Funds can be set up as tax neutral or transparent

1. No capital gains tax or value added tax
2. No withholding tax on distributions

• Structure Types: There are a number of ways a fund can be structured in Gibraltar

1. Private limited companies
2. Protected cell companies
3. Limited partnerships
4. Protected cell limited partnerships

• Cost: Competitive set up costs and ongoing fees

• Track Record: Our EIF legislation has been in place since 2005

1. Strong funds regulator in the Gibraltar Financial Services Commission
2. Mature ecosystem with an industry association in the Gibraltar Funds & Investments Association

• Time Zone (CET): Gibraltar is ideal for clients in Europe

1. We start work when you do, and are a short flight away

At the forefront of this burgeoning sector is Hassans’ Funds Team. Led by Partner Aaron Payas, our team offers industry-leading experience and expertise, assisting with:

• Incoporation of both traditional Investment Funds and Crypto Funds;
• Structuring advice;
• Regulatory and tax advice;
• Drafting documents (memorandum and articles of association or LPAs);
• Introductions to and collaboration with local service providers (Administrator, Auditor, Company Secretary);
• Registration of funds with the Gibraltar Financial Services Commission (GFSC).

Talk to our Funds team today to discuss how we can help you with the setup and management of your fund.

There are a number of ways a fund can be structured in Gibraltar. Below is an overview of each type of structure:

Experienced Investor Funds (EIFs)

A Gibraltar experienced investor fund is a regulated fund for either experienced or high net worth investors. EIFs are authorised and regulated by the GFSC.

There are a number of benefits to setting up an EIF including:

• an EIF can invest across any asset class;
• the Fund is able to launch without the need for regulatory pre-approval, providing they adhere to post-launch procedure;
• able to be tokenised through the use of approved technology solution providers;
• each cell may have a different investment strategy and fee structure; and
• one or any number of investors may participate in the investment through subscription to that cell.

EIFs can be set up in a number of ways, including:

• a regulated EIF structured as a private limited company;
• a regulated EIF structured as protected cell company (PCC)*;
• a regulated EIF structured as a limited partnership; or
• a regulated EIF structured as a protected cell limited partnership (PCLP)**.

*Protected Cell Company (PCC): A PCC allows for the creation of different sub-funds with distinct strategies and fee structures.

**Protected Cell Limited Partnership (PCLP): This allows for the creation of different sub-funds with their own unique strategies and fee structures. A PCLP is structured differently however as it is governed under a partnership agreement entered into between the general partner and the limited partners of the fund.

Private Funds

Private funds differ to EIFs as although upon launch they must be registered with the GFSC, they are not authorised or licenced by the regulator.

A private fund may invest across any asset class and must be established as limited companies or as limited partnerships. This type of fund cannot be structured as a PCC or PCLP.

There are certain promotion restrictions that apply to this type of fund, including:

• the number of persons to whom the offer is communicated must not exceed 50;
• requirement to appoint a local fund administrator and have a bank account
• the offer must be made in respect of shares in the private fund and the fund will remain private for at least one year after the date that the offer is made (upon such time at which it can then be converted into a regulated EIF.

Crypto Funds

Gibraltar is a leading jurisdiction for establishing crypto funds, especially using the EIF regime, due to its pioneering and balanced approach to regulating distributed ledger technology (DLT). Read more about Gibraltar Crypto Funds.

• Robust Regulation:

Gibraltar’s legal and regulatory framework, including the Financial Services Act 2019 and related regulations, are aligned with international and UK standards, providing a secure environment for funds.

• Tax Efficiency:

Gibraltar has a low corporate tax rate of 15% and generally does not tax income derived from activities outside Gibraltar. There is also no capital gains tax, inheritance tax, VAT, or wealth tax, and no withholding tax on dividends paid to non-Gibraltar residents.

• Flexibility and Efficiency:

Fund structures can be tailored to various investment needs, and the setup process for EIFs can be completed quickly.

• No AIFMD Thresholds:

Following Brexit, Gibraltar no longer falls under the EU’s Alternative Investment Fund Managers Directive (AIFMD). This change allows fund managers to operate outside the constraints of the €100 million and €500 million thresholds imposed by the AIFMD, offering greater freedom and less regulatory burden compared to EU jurisdictions.

• Established Infrastructure:

Gibraltar provides a well-developed professional services sector, including experienced lawyers, accountants, fund administrators, and banks, to support the funds industry.

• Attractive Environment for Fund Managers:

Gibraltar’s location in the European time zone, access to a skilled workforce, and tax benefits for managers make it an attractive location for establishing or relocating fund management operations.

Setting up a fund in Gibraltar generally involves incorporating a company or other appropriate legal structure, drafting offering documents like a prospectus or private placement memorandum, appointing a qualified administrator and potentially a depositary, and registering or notifying the GFSC depending on the fund type.

Funds generally take 6-8 weeks to set up in Gibraltar and our team will work with you every step of the way. Contact Aaron Payas at  aaron.payas@hassans.gi for an initial meeting and to find out more.

Hassans has been involved in the Gibraltar funds industry since its inception.  It has unparalleled expertise in the field. Please find a list of recent news and developments relating to the industry and of Hassans’ activity in the space, below:

If you are looking to set up a fund in Gibraltar, our team of highly experienced professionals can guide you through the entire process, from start to finish.

Contact Aaron Payas at  aaron.payas@hassans.gi for an initial meeting and to find out more.