PIFs – Professional Investors Funds (Malta)
What are PIFs - Professional Investors Funds
A PIF – Professional Investors Fund – is an investment company that does not solicit capital from retail investors or the general public; public offers are prohibited.
To be classified as a PIF, an investment fund must meet the criteria outlined in the fund regulations. There is an advantage to maintaining private investment fund status, as the regulatory and legal requirements are much lower than required for publicly traded funds.
Which Investment classes are suitable for a PIF?
Professional Investor’s Funds are flexible investment vehicles, allowing a more comprehensive range of “Alternative Investments” according to individual needs. The Maltese Law classifies three types of PIFs, targeting different investors: experienced, qualifying, and extraordinary.
Why not speak to us to find out more?
The Maltese Law distinguishes three different types of PIFs
- There have been some regulatory changes recently, and they came in force in 2017, meaning that the former classification will no longer been applicable. Now, just the following rules will apply:
- Available to investors who can meet the criteria of an experienced investor
- Most common and practical approach, seeking widest flexibility in terms of investment strategies
- Promoted to investors with a higher degree of financial sophistication
- Entry level to a Qualifying PIF is set at €100,000 or other main currencies
- No monitoring/oversight responsibilities required from the custodian.
- Wealth in excess of €750,000 for Corporate bodies, individuals and trusts.
- Available to investors who can meet the criteria of an experienced investor
- Entry level set at €10,000 or other main currencies
- Direct borrowing and leverage via the use of derivatives is limited to 100% of NAV
- A minimum set of investment restrictions must be adhered to
- Subject to the oversight of a custodian which is required to monitor the fund and ensure compliance with investment restrictions
- Most common and practical approach seeking widest flexibility in terms of investment strategies
- Promoted to investors with a higher degree of financial sophistication
- Entry level to a Qualifying PIF is set at €75,000 or other main currencies
- No monitoring/oversight responsibilities required from the custodian.
- Similar in nature to a Qualifying PIF
- A minimum investment of €750,000 with no investment restrictions at all
- No restrictions to leverage – Unlimited leverage
- Appointment of a custodian is not mandatory (provided assets are subject to adequate safekeeping arrangements)
- No need to publish Offering Memorandum – Marketing document would suffice
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