As a jurisdiction, Guernsey has become
synonymous with private equity. There
are about 850 investment funds used
for cross-border distribution around the
world. The island is also home to a wealth
of expertise and infrastructure that
handles the structure, management and
administration of private equity funds.
Apax, BC Partners, Mid-Europa,
Permira and Terra Firma are some of the
private equity firms that have established
operations in Guernsey, which is a
testament to the infrastructure available
here. In addition, Ashmore, Better Capital,
Cinven, Coller Capital, HarbourVest,
Neuberger Berman and Pantheon utilise
Guernsey investment structures.
Investors and promoters are reassured
by the position Guernsey has taken
over the Alternative Investment Fund
Managers Directive (AIFMD). Guernsey
is not in the EU (or wider EEA) and
therefore, as a third country, is not
required to implement the AIFMD.
However, a large proportion of our funds
business relates to Europe, while we also
have a substantial amount of business that
originates from outside Europe.
As such, the island has put in place
a dual regulatory regime, making it
possible to continue to distribute funds
into both European and non-European
countries. Meanwhile, the existing regime
remains for investors and managers who
do not require an AIFMD fund, such as
those using National Private Placement
(NPP) regimes or marketing to non-EU
investors. There is also an opt-in regime,
which is fully AIFMD compliant.
Guernsey managers who want to access
Europe continue to use NPP regimes,
which are expected to remain until 2018.
Using NPP will likely be favoured over
AIFMD, which has stricter requirements.
The island still has an existing base of
clients for whom Europe is an important
market, and the opt-in equivalent regime,
which has been in place since January
2014, will be appropriate for such funds.
Fiona Le Poidevin, chief executive of Guernsey Finance, on why the
Channel Island is home to many established private equity businesses
For those with a growing non-European
focus, it will be possible to place this
business in parallel or feeder structures
for which AIFMD compliance and the
associated costs would not be required.
Commercial decisions should dictate the
most suitable approach.
Full passporting for non-EU alternative
investment fund managers is expected
from July 2015. If it comes in, managers
will be able to market on a pan-European
basis with a single authorisation.
Guernsey’s funds sector has enjoyed
considerable growth in recent years, with
total net asset value worth £266 billion
in late 2013. In the same period, the net
asset value of private equity funds under
management and administration was
more than £86 billion – up 6.2% over the
course of the year.
Growth is aided by the ability of
Guernsey entities to access a range of
international stock exchanges in, among
other places, London, Ireland, Australia,
Toronto, Frankfurt, Hong Kong and the
Channel Islands. In December 2013,
Guernsey had more entities (115) listed
on the London Stock Exchange than any
other jurisdiction globally.
Guernsey has emerged as a leading
centre for private equity, and, with its
thirst for innovation and adherence to
high standards, there is confidence that it
will remain the premier European centre
for such activity.
For more information, contact Guernsey
Finance on +44 (0)1481 720071 or at
If you want a more
to fund business,
there’s one place
you should look...
Guernsey offers the experience, the infrastructure and the intellectual
capital to deliver innnovative fund solutions for any market, in any asset
class. We combine a breadth and depth in management, administration,
custody and structural innovation that is second to none, with a wide
non-executive director resource, as well as a first class, well regulated
Make Guernsey your first port of call.
Telephone: +44 (0) 1481 720071 Email: email@example.com
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