Managers and funds swap places

Author: | Published: 1 Jun 2009

Offshore jurisdictions such as Ireland, Luxembourg, Cayman and Bermuda have always competed to be the prime domicile for the global funds industry. These funds have been managed by investment advisers primarily located in the UK and US. But in the April 2009 budget the UK government introduced tax changes that enable the UK fund regime to compete more effectively with other international structures. Ironically, in tandem with rules to attract the funds themselves onshore, the Treasury has introduced income tax rules that may force fund managers to leave the UK.

The European Commission, under political pressure, has also proposed changes that will alter the fund management industry. On April 29 2009 it released its Draft Directive on Alternative Investment Fund Managers, proposing the regulation of certain fund managers of non-Ucits funds. The proposals may mean that affected fund managers leave the UK in search of a less intrusive and costly...