Investment Undertaking for Transferable Securities (UCITS)
This is the Liechtenstein name for investment funds that meet the requirements of European Union directive 85/611/EEC. Once licensed by Liechtenstein’s Financial Market Authority (FMA), these funds benefit from the “UCITS passport”, allowing them to be marketed throughout the European Economic Area (i.e. European Union plus Liechtenstein, Iceland and Norway) without having to apply for any additional license, either by setting up a local office or by marketing themselves under EEA rules governing the unrestricted cross-border provision of services. An Investment Undertaking for Transferable Securities can also be structured as a fund of funds or index fund.
Legal basis: Art. 41 et seq. IUA, Art. 37–50 IUO
Investment Undertaking for Other Assets (non-UCITS)
This term denotes funds that do not qualify as either Investment Undertakings for Transferable Securities or Investment Undertakings for Real Estate. As EU law does not contain provisions governing Investment Undertakings for Other Assets, Liechtenstein legislation is not tied to any external regulations. These funds can therefore pursue investment strategies that are not feasible under the relatively strict diversification rules and investment limits that apply to UCITS. This subcategory of funds also includes Investment Undertakings for Other Assets with Increased Risk and Investment Undertakings for Qualified Investors.
Legal basis: Art. 42–44 IUA, Art. 51–55 IUO
Investment Undertakings for Qualified Investors
This is a special form of Investment Undertaking for Other Assets that is suitable for institutional investors and experienced private investors. Funds in this category can be designed in many different ways and can even be structured as a genuine singe-investor fund. Since qualified investors are assumed to require a lower level of protection, these funds are exempted from various provisions of the IUA and IUO: they do not need to be licensed by the FMA, and they are exempt from the obligation to produce a full prospectus and half-yearly reports and from other publication requirements. As a result of these factors, such funds can be set up quickly.
Legal basis: Art. 23 IUA, Art. 28 & 29 IUO
Investment Undertakings for Real Estate (non-UCITS)
This is the name for funds that invest in real estate in accordance with the principle of risk diversification. No more than 20% of their net assets may be invested in a single real estate position at any given time.
Legal basis: Art. 45–52 IUA, Art. 56–62 IUO
Umbrella Fund
Under Liechtenstein law an investment fund may be segmented into several subfunds that are economically independent of one another, provided that both full and simplified prospectuses are published. All the subfunds must have the same management company, custodian bank and auditors.
Legal basis: Art. 53 IUA, Art. 63 und 64 IUO
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