IBA Conference Panel Highlights Jersey’s Ability to Meet Emerging Funds Trends

Jersey’s ability to support the evolution of an increasingly flexible, global and technology-enabled private markets landscape was highlighted in a panel session at the IBA Private Investment Funds Conference in London recently (8-10 March).

The sold-out event, which Jersey Finance sponsored, was attended by major US and UK law firms and explored the key themes shaping the cross-border funds landscape, from geopolitics and regulation to investor behaviours and technology.

In one panel session, entitled ‘Battle of the Jurisdictions’, Partner at Walkers Dilmun Leach represented the Channel Islands discussing the comparative strengths of leading fund domiciles. Up against representatives from Luxembourg, Ireland and Cayman, he made a strong case for Jersey’s position as a leading jurisdiction for private funds, with the discussion focussing on substance, speed, ease of doing business, the Jersey Private Fund (JPF), Alternative Investment Fund Managers Directive (AIFMD) II, carried interest, tax neutrality and marketing under national private placement regimes (NPPR).

The audience response was a clear endorsement: when asked for their preferred jurisdiction, they gave Jersey the crown, recognising the following qualities:

Substance: Jersey offers real on-island substance, with deep expertise across legal, regulatory, administration and governance services, supported by a strong reputation as a sophisticated and well-regulated international finance centre

Speed: Jersey is fast, pragmatic and efficient, with the Jersey Private Fund regime in particular designed to help managers bring products to market quickly and smoothly

Ease of doing business: Jersey combines regulatory credibility with a commercial, solutions-focused approach, giving managers and investors a jurisdiction that is straightforward, stable and easy to navigate

Jersey Private Fund: The JPF is a streamlined, flexible and highly efficient product for private fund structures, offering a proportionate regime that is well suited to the needs of private capital

AIFMD II and NPPR marketing: Jersey continues to provide effective and familiar access to European investors through NPPR regimes, giving managers a practical and well-established route to market into key investor jurisdictions.

Carried interest and tax neutrality: Jersey’s tax neutral regime is a crucial advantage for private funds, giving managers and investors a clear, efficient and internationally familiar framework. This is particularly compelling when compared with more complex jurisdictions, where additional layers of tax and structuring can add cost and complexity.

Elsewhere at the conference, speakers and panellists focussed on the factors shaping the private markets landscape, including the emergence of new fund structures such as evergreen funds, hybrid/open-ended models and creative capital-raising structures, as well as greater retail investor access to private markets and how institutional and retail capital increasingly sit alongside each other within structures.

From a jurisdictional perspective, these shifts mean that managers are increasingly looking for:

• structuring certainty and expertise to support the next generation of private capital vehicles
• an ability to balance innovation with investor protection when it comes to the expansion of private markets into the wealth space
• an environment conducive to fund finance innovation
• a global platform that can connect investors and managers across multiple markets
• an ability to support managers from emerging strategies to global platforms
• stability and predictability against a backdrop of geopolitical and regulatory complexity

Commenting on the event, Elliot Refson, Head of Funds, Jersey Finance said:

“The future of private funds is flexible, global and technology-enabled and having a platform at this major IBA event provided a powerful way to demonstrate Jersey’s ability and appetite to support this new era of fund structuring. Ultimately, managers and investors want solutions that work, that offer regulatory credibility and that can guarantee day-to-day efficiency – and that came out strongly in the panel session.

“As the private markets continue to evolve, Jersey’s dedicated workforce of almost 14,000 professionals is working with managers, legal advisers and tax professionals to help navigate this shifting landscape – providing certainty around structuring and the expertise required to support the next generation of private capital vehicles.”

More about Jersey’s innovative global funds proposition here.