In April 2017, the Jersey Financial Services Commission (“JFSC”) introduced a new, consolidated and streamlined funds regime, known as the Jersey Private Fund (“JPF”) regime, which is intended to enhance Jersey’s competiveness as a leading jurisdiction for funds domiciliation and administration. The JPF replaces three previous fund structures (COBO Only Funds, Private Placement Funds and Very Private Funds), however, it will not have a retroactive effect and all existing funds will continue their operations under their respective regimes unless they apply to become a JPF.
A JPF is a private investment fund involving the pooling of capital and operates on the principle of risk spreading. Therefore, more than one investor is needed and a number of assets need to be acquired in order to diversify investments and spread the investment risks. Holding companies, joint venture vehicles, securitisation vehicles, family office vehicles or incentive arrangements should not fall within the definition of a JPF.
Key advantages of using JPF’s
- The regime is flexible in that a JPF can be established as a Jersey company, cell company, limited partnership or unit trust and the JPF may be open or closed ended.
- In addition, a JPF can also be established as a non-Jersey entity provided the required COBO consent is obtained in Jersey.
- A JPF is not required to have Jersey resident directors, general partner or a trustee.
- There is a streamlined authorisation process and a JPF can be authorised by the JFSC within 48 hours of receipt by it of a complete application.
- A JPF may only be offered to Professional or Eligible Investors who fulfil certain specific criteria under the new JPF Guide.
- A JPF must have less then 50 investors and is not allowed to be listed.
- A JPF must appoint a Jersey based Designated Service Provider who will act as administrator of the fund.
- Simplified and understandable regime
- Designated Service Provider must be a regulated entity in Jersey
- Promoter does not need JFSC approval
- No need to appoint auditor unless required by its constitutional documents
- JPF can be compliant for AIFMD purposes