Eternity Law International — News — Registration of an investment fund

Registration of an investment fund

Published:
October 12, 2020

Registration of an investment fund is an urgent issue for commercial entrepreneurs who want to invest their capital.

WHOM IS THE INVESTMENT FUND USED FOR?

Funds are created for profitable investment of currency. They combine the financial resources of several investors to form a single capital, which will help attract new partners and increase total income.

For effective operation of the system, competent investment professionals are led by a competent manager.

Investment funds include:

  • organizations that have received an official license;
  • law firms: holdings, trusts, exchanges, etc.

The owner of the capital should well think out a plan for organizing financial activities.

An alternative form of investing in family investments is a trust, where you do not need to attract a large mass of people to create a basis for profitable investments.

The disadvantage of trusts is the complexity of organizing the structure itself. Their essence is that the founder or owner of the property transfers it to the trustee for actions only in the interests of the founder or beneficiaries.

The trust is not a law company and may keep confidential information about the current owner of the trust property (capital).

Another means of optimizing taxable income can be the organization of private funds. Their activities are similar to the work of trusts. The creation of such companies is possible in countries with a Continental legal system.

Unlike a trust, a fund is an officially registered financial unit and its work is subject to tax payments for preferential categories and is protected by the laws of the country in which the company is opened.

If an investor wants to delegate his resources to third parties, it is worth considering the organization of an investment fund. For his work, you will need a license, which is issued by a specialized executive body.

In each country, this function is performed by a financial committee that manages cash flows.

HOW MUCH DO I NEED TO INVEST TO CREATE AN INVESTMENT FUND?

The main selection criterion for the organization of the company is the availability of a sufficient amount of investment. European countries set higher prices for opening investment funds than similar offshore companies.

If you plan to work with the material resources of ordinary citizens, it is necessary to organize a full staffing set, and for its functioning additional costs will be required.

Working with legal investing companies does not require additional staff, so such a fund will be cheaper.

WHAT IS THE BEST MANAGEMENT COMPANY OR INVESTMENT FUND?

These concepts in practice have different meanings, it is worth remembering this when opening a reserve fund of additional investments.

Own company is an ideal resource for preserving capital, but has difficulties in creating. Purpose of her work:

  • investment fund management;
  • execution of transactions with entrusted property;
  • exercise of rights regulated by securities.

The possibility of organizing stock enterprises without licensed documents (some offshore companies) is allowed.

A good option for registration of the fund on autonomous management, but not suitable for classic organizations.

WHICH FUND IS BETTER ̶ OFFSHORE OR EUROPEAN?

Your company values ​​its reputation and wants to earn money, we advise you to choose the European Union market and obtain a license of a European legal level. The advantage of registration will be permission to conduct marketing projects both in the EU countries and beyond.

When it is possible to create a fund with large material resources, it is better to organize an investment fund in Europe under offshore laws. In organizing activities in the European market, you will not suffer, but you can offer your products only in private.

Advantages of the jurisdiction of offshore companies:

  • optimization of tax costs for maintenance;
  • not subject to serious tax audits;
  • creation of risky currency strategies is permissible;
  • no investment restrictions.

To ensure the effective management, preservation, multiplication of its assets, as well as the organization of cooperation with a third party, it will be beneficial to register an investment fund. And experts at Eternity Law International will take an active part in implementing your ideas.

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