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Seychelles in 2008 passed cutting edge, new (very market friendly) Fund Laws designed to encourage a significant number of Funds and Fund Managers to register here over the next few years (and we incorporated more IBCs than BVI in 20008 AND we also now have a Foundation Product to offer which is similar to but considerably better than Panama’s).

The Main Benefits of a Licensed Managed fund Structure in the Seychelles
• Seychelles is a well regulated and respected jurisdiction (OECD, FATF and IMF compliant)
• The progress and growth of the jurisdiction has been very steady over the past 14 years (averaging 10% + growth every year)
• The laws in Seychelles are extensively researched in that comparable jurisdictions laws are considered at length before new laws (creating new or improved products/services) even hit the drawing board
• Seychelles is very politically stable (no threats of political riots etc as the standard of living is very high)

The Seychelles as an Offshore Jurisdiction is very favourable in that:
• Seychelles has a very stable, democratic AND tolerant society
• The country pays its own way and is not dependent on others for financial assistance
• Seychelles is an independent country and not beholden to any super-power such as US, UK, Aus EU etc
• Seychelles Financial Services Sector is extremely efficient, ethical and competent

The Seychelles Mutual Fund Act itself is very favourable in that:
• Investors are well protected (eg the Authority can take action to protect investors’ interests as required)
• It’s an easy Act to understand
• Seychelles is a well regulated well respected jurisdiction
• The new Act is an enabling law- it is designed to ATTRACT new Funds, not to tighten the regulation of existing funds
• A lot depends on negotiation with the Regulator - there’s not many places where your Seychelles agent can literally knock on the office door of the Head of the Mutual Fund Regulator and ask for a personal meeting
• Seychelles is based in a very favorable timezone at +4GMT which gives Seychelles overlapping contact with the business days of Australia, Asia, UK and Europe
• Privacy is guaranteed by law – the Mutual Fund Authority in Seychelles is prohibited by law from disclosing anything to do with its activities to 3rd parties.
• Seychelles has excellent facilities in terms of Service Providers, Communications, Hotels, Service Businesses etc
• Much depends on the quality of the application, the applicants and the professional reputation of the local service provider representing the applicant (in your case any such application would be presented by the ONLY firm in Seychelles owned and managed by an International Lawyer, which can only be to your benefit)
• The Regulator has true flexibility in determining whether to grant a license or not to a particular applicant, meaning that each application will be treated individually on its own particular merits.

Licensed Fund Choices in the Seychelles
There are three kinds of Licensed Fund that one can set up in Seychelles, a Public Fund, a Professional Fund and a Private Fund. The essential differences and distinctions are as follows:

1. A Public Fund is one which is designed to be mass marketed. As it is aimed at the general public a very detailed Offering document must be given to and approved by the Authority before a license is granted. (The authority needs to be sure that all plans and risks of the fund are disclosed upfront to the investors).
2. A Professional Fund is one aimed at qualified/sophisticated Investors. Minimum investment is $100,000 and only qualified investors can invest (ie in the case of an individual, the investor must have a net worth of at least one million USD). Unlike a Public Fund one does not need to file a finely detailed Offering document prior to receiving License approval.
3. A Private Fund is one aimed at the Professional Adviser looking to gather together a consortium of investors from his/her client database. It is limited to 50 investors only. No minimum or maximum investment is required. Again, unlike a Public Fund one does not need to file a finely detailed Offering document prior to receiving License approval.

Private Fund
In my view a Private Fund is by far and away the most suitable kind of Fund structure for Traders looking to spread their wings and for aggressive Asset Managers. The limitations are as follows:

1. Limited to no more than 50 investors in (though there’s no limit on replication of the licensed fund model itself)
2. The constitution documents of which must specify that an invitation to the public to subscribe for shares is prohibited.
3. Not permitted to be able to be registered as a licensed managed investment scheme in “onshore jurisdictions”, such as would otherwise be possible with a Licensed Public Fund

How to Register as a Private Licensed Fund
The process for applying for registration as a Fund in Seychelles is quite simple and streamlined (in particular compared to our competitor jurisdictions eg Caymans, BVI etc, and has been deliberately designed to be so in order to forthwith begin attracting business). Any proposed application, would likely not be subject to delays as may otherwise be the case in a jurisdiction other than the Seychelles.

Offshore Licensed Fund Establishment Services Outline
Should you be interested in going down the path of registering a Licensed Managed Fund we can assist with all or any of the following:

• Providing detailed advice on the application process and legal requirements
• Drafting and/or Settling of Fund License Application, Offering document/s, etc
• Creation/Incorporation of the Fund Entity
• Incorporation of a Trading Company entity
• Incorporation of an Investment Manager entity
• Providing Professional “Nominee” Director, Company Secretary, Nominee Shareholder and Offshore Management services for any Offshore Trading or Investment Manager Companies
• Providing Professional “Nominee” Director, Company Secretary, and Offshore Management services for the Fund entity
• Drafting and/or Settling agreements as between the above various entities
• Provision of Custodian Services
• Advice and assistance as regards establishment of Offshore Banking services for the various abovementioned entities
• Provision of Offshore Corporate structuring advice and assistance
• Provision of Account signatory and fund forwarding services
• Provision of Registered Agent and Registered Office services for the Fund entity (and other above-mentioned entities)
• Vetting and hiring of local auditors as/if required
• Location, vetting and selection of an appropriately qualified Fund Manager (if required)
• Liaising with the Authority and yourself as the Fund Applicant’s Seychelles Legal representative with respect to submission (and lobbying for registration of) the Fund License application

Why Not Choose Seychelles?
If six months ago clients had come to me for advice (ie before the passing of new Mutual Funds Laws in Seychelles) I would have suggested that they consider establishing a fund in either Caymans or BVI.

There is absolutely no doubt in my mind that establishment of a Private Fund in Seychelles is the way to go at present, essentially for these reasons:

(a) Why set up a Fund in say BVI when you should be able to do it faster, with less paperwork, less red tape and at a cheaper price in Seychelles?
(b) Whilst the new Seychelles Mutual Fund law draws heavily on the Caymans, BVI and Luxembourg models the simplicity of the Application procedures and lack of red tape involved in the licensing process are going to bring a lot of Fund business to the jurisdiction over the course of the next few years, of that there can be little doubt.
(c) In Seychelles you have an experienced legally qualified contact with Private Fund Set up experience
(d) In Seychelles you have one of the world’s top ten banks (Barclays) in which to safely bank the Funds and the investors money
(e) In Seychelles you have a contact that has a close personal and professional relationship with the Director of Barclays Bank Seychelles Offshore Bank
(f) In Seychelles you have a contact that enjoys a close working relationship with the Mutual Fund regulator (Mr Conrad Benoiton) who, (in particular with my firm being the only firm here owned and managed by an International Lawyer), has enabled me to enjoy a close and open professional relationship with him for the past 8 years.
(g) In Seychelles you have a contact that enjoys a close personal (and professional) relationship with the gentleman who drafted the new Mutual Fund Law

If you’re interested to know more about how to go about setting up a fund here (or about how to get registered as a Fund Manager here) please contact us! - Learn more here