The Isle of Man is recognised throughout the world as a leading international business centre and holds an AAA credit rating from Moodys and AA+ by Standard & Poor, based on the Isle of Man’s robust financial position and stable outlook.
Collective investment schemes (mutual funds) in the Isle of Man are regulated by the Collective Investment Schemes Act 2008.
The Isle of Man Financial Supervision Commission (FSC), the regulatory authority on the Isle of Man responsible for collective investment schemes, is committed to applying international standards of regulation and supervision across all areas of its work in order to maintain the integrity of the Isle of Man’s financial system.
The fund vehicle may be an open-ended investment company (OEIC), a limited partnership or a unit trust.
An OEIC vehicle could be either a company incorporated under the Companies Acts 1931 – 2004 or the Companies Act 2006. The latter have become the “vehicle of choice” because of their simplicity of administration.
The fund’s offering document or prospectus must accurately set out all material information which is relevant for the purpose of making an informed judgement about whether to invest in the fund.
All funds will have a governing body: the board of directors of the fund in relation to an OEIC, the board of directors of the general partner in relation to a limited partnership or the board of directors of the trustee in relation to a unit trust. In addition, their operation will in most cases require the appointment of other functionaries and in some cases, such appointment may be mandatory.
There are three categories of Isle of Man collective investment schemes – see below: regulated (Authorised Funds, Regulated Funds and Recognised Funds), registered (Specialist Funds and Qualifying Funds) and unregulated (Exempt Schemes).
There have also in the past been other types of fund not mentioned below (for example, Experienced Investor Funds, Full International Schemes) but these have largely been superseded (although existing funds have been permitted to continue) and are not dealt with here.
The Isle of Man imposes no stamp duty and no capital or inheritance taxes. Fees payable by collective investment schemes (other than Exempt Schemes) to Isle of Man administrators and investment managers are exempt from Isle of Man value added tax (VAT).
Read the full article here: Collective Investment Schemes in the Isle of Man