UCITS and other investment funds pursuing liquid investment strategies

Undertakings for Collective Investment in Transferable Securities (UCITS) are liquid funds that benefit from a European marketing passport and can be sold to retail and institutional investors in all EEA member states. UCITS can also be sold in numerous non-EU countries that recognise the UCITS label and the investor protection regime it entails. UCITS are not only popular with retail investors, but are also attractive for professional and institutional investors who value the enhanced regulatory supervision of such vehicles.

The Luxembourg investment fund toolbox also offers a range of other fund structures, including Part II funds, specialised investment funds (SIFs) and reserved alternative investment funds (RAIFs), which provide the flexibility to investment various liquid investment strategies.

Luxembourg and Elvinger Hoss Prussen have played an instrumental role in structuring UCITS and other investment funds, having notably acted as legal adviser in relation to the creation of the first UCITS in 1988 and  the first RAIF in 2016. 

Our clients

Our firm advises clients from all over the world in the structuring of their investment funds and on the most suitable fund vehicle taking into account investors’ needs. Our extensive legal and market knowledge ensures clients are fully equipped to operate in a highly regulated environment. We are part of numerous industry associations and actively participate in shaping the EU and Luxembourg regulatory asset management framework.

Our services

Our specialist advice covers areas such as:

• Applicable investment rules and limitations
• Disclosure requirements
• Governance
• The use of derivatives and related limitations
• Share class structuring
• Fund of funds investments
• Hedging features
• Exchange traded funds (ETF)
• Cross sub-fund investments
• Possibilities for the use of hedge fund-like strategies
• Money market fund (MMF) rules
• Depositary and prime broker issues

Our team can also assist with the key steps involved in structuring investment funds, including:

• Selecting the most suitable and strategically aligned legal structure
• Establishing a comprehensive governance and management framework
• Drafting the legal documentation required for setting up the investment fund
• Drafting and negotiating agreements
• Navigating the compliance and regulatory landscape while safeguarding client interests
• Assisting with the approval process by the Luxembourg regulator
• Ongoing assistance in legal, regulatory and tax matters, and in solving day-to-day issues while ensuring legal and regulatory compliance
• Advising on compliance with all sustainability-related laws and regulations (such as SFDR and the Taxonomy Regulation)
• Legal and regulatory updates and customised training on regulatory topics such as eligible assets, SFDR, marketing, liquidity management tools, performance fee disclosure, use of securities financing transactions (SFT), money market regulations, etc.