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Investment Funds in Ireland

Investment Funds in Ireland

Investors can choose between several types of investment funds in Ireland, as well as more than one legal structure under which they can incorporate these funds. Those who choose to invest in Ireland enjoy several advantages, among which the taxation system and a solid legislative system, along with governmental incentives.

Our team of Irish solicitors can provide assistance for the incorporation of an investment fund and can offer guidance for those who open UCITS in Ireland – which is one of the types of funds as described herein.

Types of investment funds in Ireland 

Investment funds in Ireland are set up under two main legal structures. One refers to the Undertakings for Collective Investment in Transferable Securities (UCITS) and the other structure refers to the Alternative Investment Funds (also referred to as non-UCITS). 

The UCITS were introduced in 1985 on the European market, under a directive of the European Union (EU) which was trying to create a single market for investment schemes within the EU area. 

UCITS can be established under a single fund structure or under an umbrella structure, which means that the investors are allowed to set up several sub-funds within the main fund. The main advantage of establishing sub-funds is that they can carry out different investment strategies and different business objectives. 

Irish UCITS can be set up under the following: 

  • Exchange Traded Funds (ETF) – the structure was introduced in 2000 and it is important to know that 50% of the European ETFs assets are established in Ireland;
  • Money Market Funds – Ireland is the top destination of the funds set up under this structure. 

Alternative investment funds (AIF) are regulated by the Alternative Investment Fund Manager Directive (AIFMD), issued in 2013. The first legal framework for AIF available in the EU was first introduced by Ireland, which, later on, introduced in its legislation the AIFMDour team of Irish lawyers can offer more details in this sense. 

Regulatory framework for Irish funds 

The main institution regulating the activity of the Irish funds is the Central Bank of Ireland, the body which provides authorization to such entities. 

Irish UCITS are regulated by laws provided by the EU, and by relevant provisions stipulated by the Central Bank: 

  • Statutory Instrument No. 352 of 2011 – European Communities UCITS Regulations 2011;
  • Statutory Instruments No.143 of 2016, No. 430 of 2019, No. 413 of 2021, No. 269 of 2018, No. 262 of 2022, and No. 422 of 2022 – these are either regulations or amendments to existing regulations for the EU Undertakings for Collective Investment in Transferable Securities;
  • the Statutory Instrument No. 230 of 2019 issued by the Central Bank of Ireland, the Supervision and Enforcement Act (Act 2013) – more specifically section 48 which concerns the regulations for Undertakings for Collective Investment in Transferable Securities, important for those who open UCITS in Ireland.

Our lawyers in Ireland can give you more information about these regulations, and the legislation applicable to UCITS upon request.

Legal structures used to open investment funds in Ireland

Investors who choose Ireland as their funds’ jurisdiction can structure the fund by using one of the following legal structures:  

  • investment company: this is a corporation registered as per the Irish Companies Act; the shareholders enjoy limited liability;
  • variable capital company: also incorporated as per the Irish company formation laws; this can be a suitable option for those who open UCITS in Ireland;
  • the collective asset-management vehicle: this is a type of vehicle specifically designed for investment funds in Ireland; it is exempted from certain regulations comprised by the Companies Law;
  • unit trust: a structure set up by using a deed between a trustee and a management company; it is not a separate legal entity.

The experts at our law firm in Ireland can give you more detailed information about these legal structures, the incorporation requirements, and their advantages for setting up one of the available types of investment funds in Ireland.

What to consider if interested in investment fund creation

Apart from selecting the legal structure for the fund appropriately, investors are also asked to take into account the submissions they will need to make with the Central Bank for the purpose of regulating the trust (as needed according to its type).

Below, you can see an estimated assessment time by the Central Bank according to the type of investment funds in Ireland:

  • the initial response for a fast-track UCITS fund can be issued in 10 working days;
  • subsequent comments for the fast-track UCITS are issued within 5 working days; our attorneys in Ireland can give you more details;
  • investors who open UCITS in Ireland under the non-fast track scheme can expect an initial comment within 20 working days.

Our team focuses on providing valuable legal solutions and services for both private clients and businesses. You can also reach out to our lawyers for issues regarding divorce in Ireland or to our accountants in Ireland if you have questions about taxation.

Investors who need to receive further information on investment funds in Ireland can contact our Irish law firm for more details on the local legislation.