Following the promulgation of the Securities and Investment Business (Incubator and Approved Funds) Regulations 2015 (the "Regulations"), the British Virgin Islands (the "BVI") has established two additional types of funds, incubator funds andapproved funds. Prior to the Regulations, the BVI offered three types of open-ended funds; private funds, professional funds and public funds.
In comparison to the previous funds, the two new funds are lightly regulated and are very cost efficient. The incubator fund is a start-up fund which offers managers a straightforward, economical solution for implementing an investment strategy with low up-front costs and limited on going obligations. The approved fund is aimed at the “friends and family” market and is similar to the private fund, but with less stringent regulation and lower on-going costs. The chart below provides a comparison of the five BVI funds, from formation to on-going obligations.
The following defined terms are set out in the comparison table:
Click here to view table.