Investment Funds and Investment Management
Cost-effective pan-European investment and investment fund management vehicle. Equity capital requirement – EUR 125 000.
EU directive 2009/65/EC on the Coordination of Laws, Regulations and Administrative Provisions Relating to Undertakings for Collective Investment in Transferable Securities (UCITS) allows investment managers licensed in one European Union (EU) member state to offer their investment funds to all investors in European Union and European Economic Area (EU/EEA). EU directive 2011/61/EU on Alternative Investment Fund Managers (AIFMD) allows pan-European marketing of investment funds designed for professional or alternative investors. National regulators in other EU/EEA member states not allowed to make any barriers or rise additional requirements.
Modern financial infrastructure and favorable legislation make Lithuania one of the most attractive places in Europe for investment managers targeting a single European financial market. Creator of the world’s first electronic stock market Nasdaq has a strong presence in Lithuania and the Baltics establishing Nasdaq Technology and Business Support Competence Center in Vilnius. Nasdaq Stock Exchanges in Tallinn, Riga, and Vilnius from the Baltic Market, the core idea of which is to minimize the differences between the markets in order to facilitate cross-border trading. Central Securities Depository of Lithuania, Latvia, and Estonia owned by Nasdaq and providing high-level depository services.
One Investment Management license for all Europe
Investment management companies registered in Lithuania allowed incorporate and manage investment funds registered in other EU member states. For instance, a fund management company registered in Lithuania can manage investment funds registered in other jurisdictions like Luxembourg, keeping assets of the fund in Luxembourg depository and using services of Luxembourg-based brokers and investment advisers to distribute the funds. This creates a safe, efficient, and cost-effective pan-European investment management vehicle.
Modern Lithuanian regulation allows fund managers to reside outside Lithuania letting them be near their clients all the time. The possibility to outsource relatively cheap NAV calculation, investor’s relations, or other managerial functions from local service providers gives a strong competitive advantage.
Business-oriented Investment Management and Fund regulation
The Bank of Lithuania (Central bank and the Regulator) came out from the watchdog’s role, committed to consult and support star-ups and not punish them during the first year of operation for minor infringements. Attraction of the international investment and fund management companies is the publicly declared policy of the Lithuanian Government and Regulator. Business-oriented regulatory approach and significantly lower finance institution incorporation, licensing and maintenance costs make Lithuania the preferred jurisdiction for investment advisers and managers to target the European market.
Reasons why Lithuania is the top jurisdiction for Investment Management and Fund licensing
- Business-oriented regulation and fast licensing process.
- Existing financial market infrastructure and a big pool of professionals.
- No particular requirement for company management to reside in Lithuania.
- The documents can be submitted in English.
- Regulatory “Sandbox”. The Bank of Lithuania is committed to support newly incorporated companies.
- Startup visa. Special visas for the citizens of non-EU/EEA countries running innovative businesses in Lithuania.
ECOVIS experience in investment management and fund licensing
Being part of ECOVIS International consulting network present in more than 80 counties around the world ECOVIS ProventusLaw currently considered as the most experienced financial licensing advisor in Lithuania. ECOVIS experience starts from the incorporation and licensing of the first Lithuanian modern investment fund NSEL 30 Index fund and Fund’s Management Company 15 years ago. ECOVIS licensed in Lithuania more than 35 finance institutions including big names as deVere, Nium, Contis Group. ECOVIS ProventusLaw provides all the necessary services including preparation of licensing documentation, business plan, representation at the Bank of Lithuania (Regulator) during the licensing procedure, company incorporation, office registration, advice on IT, HR, compliance, and other issues arising during the business incorporation in Europe. After the licensing procedure completed, ECOVIS offers accounting, reporting, audit, compliance, and legal services for the operational business.
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