Investment in specialised investment funds (SIFs) is reserved for "well-informed investors" only. Notwithstanding such apparent restrictions, SIFs may be admitted to listing on the Luxembourg Stock Exchange, which is a regulated market within the meaning of Article 47 of the Directive 2004/39/EC of the European Parliament and of the Council on the Markets in Financial Instruments. Indeed, while the listing requires the instruments to be freely transferable, current regulations allow certain restrictions in respect of the free transferability where such restrictions are not likely to affect the proper functioning of the market.
The Commission de Surveillance du Secteur Financier has recently clarified its position in respect of the listing of open-ended SIFs. These entities are treated as collective investment undertakings other than of a closed-end type. They are therefore exempted from publishing a prospectus under the Directive 2003/71/EC of the European Parliament and of the Council of November 4 2003 on the prospectus to be published when securities are offered to the public or admitted to trading. Such open-ended SIFs merely have to publish a simplified prospectus.
Listing thus becomes accessible, provided that (i) the SIF has published annual accounts for three consecutive financial years (for an exemption to apply), (ii) the SIF has floated an adequate number of securities to allow the organisation of a proper market and (iii) appropriate mechanisms are established to ensure that the ownership of those securities is limited to "well-informed investors".
Valérie Mantot and Thibaut Partsch