The Irish Minister for Finance has recently published a document outlining the main provisions which will form part of the forthcoming draft legislation for the Irish ICAV.
The ICAV will be a new corporate fund vehicle for Ireland. The ICAV will sit alongside the existing corporate structure for collective investment schemes in Ireland, namely the public limited company (plc). It is anticipated that the ICAV structure will be available to both Undertakings for Collective Investment in Transferable Securities (UCITS) and Alternative Investment Funds (AIFs).
One of the main features of the ICAV will be its ability to elect to be treated as “look through” under the US check-the-box taxation rules. The plc vehicle is not permitted to make such an election.
It is expected that the ICAV will have lower administrative costs than the existing plc vehicle as it has been designed specifically for investment funds. Therefore, much of the Irish company law and accounting rules, which currently apply to existing Irish collective investment schemes structured as plcs, will not apply to the ICAV structure.
The introduction of the ICAV vehicle will be welcomed by fund promoters and will help maintain Ireland’s status as a domicile of choice for investment funds.
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