Why Luxembourg | Doornbos Lagerveld & Partners

Why Luxembourg?

Setting up a Reserved Alternative Investment Fund (RAIF) in Luxembourg presents numerous advantages for investors and asset managers seeking robust and flexible investment solutions. Here are key reasons why Luxembourg is a preferred location for establishing a RAIF:

Strategic Financial Hub

Luxembourg is known for its strategic position as one of the leading financial hubs in Europe. With its strong regulatory framework and business-friendly environment, Luxembourg offers a multitude of benefits for fund managers and investors. The country's commitment to financial innovation and stability attracts fund structures globally, making it an ideal place for your RAIF.

Flexibility and Efficiency

A RAIF in Luxembourg provides excellent flexibility compared to traditional fund structures. It does not require prior regulatory approval from the Commission de Surveillance du Secteur Financier (CSSF) before commencing activities, allowing for a quicker time-to-market. This efficiency is pivotal for fund managers looking to capitalize on emerging investment opportunities without unnecessary delay.

Regulatory Framework

Although a RAIF is not directly supervised by the CSSF, it must be managed by an Alternative Investment Fund Manager (AIFM) adhering to the European Union’s robust AIFM Directive requirements. This ensures a high level of investor protection while maintaining operational efficiency. Additionally, the RAIF benefits from Luxembourg’s credible regulatory environment, ensuring compliance and trustworthiness.

Tax Optimization

Luxembourg provides an advantageous tax regime for RAIFs, including the possibility of tax exemptions for certain asset classes and categories. The RAIF benefits from Luxembourg’s extensive network of international double tax treaties, which can provide significant tax efficiencies for investors, allowing funds to maximize returns.

Diverse Investment Opportunities

RAIFs in Luxembourg can encompass a wide range of asset classes, including private equity, real estate, infrastructure, hedge funds, and more. This level of diversity offers fund managers the ability to create tailored investment strategies that meet specific investor needs.

International Recognition

Luxembourg offers significant international recognition and credibility as a fund domicile, benefiting from its well-established financial ecosystem and proactive regulatory authorities. The country’s reputation for stability and transparency enhances investor confidence in the RAIF structure.

Expertise and Support

With a wealth of specialized service providers, including banks, law firms, and advisory companies, Luxembourg offers comprehensive support to help manage your RAIF successfully. This includes access to world-class expertise in fund administration, legal compliance, auditing, and other essential services.

At Doornbos Lagerveld & Partners, we bring unparalleled expertise in the setup and management of RAIFs in Luxembourg. Our team is dedicated to guiding you through the complexities of fund establishment, ensuring your fund is optimized for success in this prime financial locale.