ELTIF 2.0

The new Luxembourg ELTIF regime, effective from January 2024, allows fund managers to continue benefiting from a very attractive investment toolbox while broadening the investor base.

Key features include:

• Luxembourg modernised its Part II UCI regime in 2023 to allow for increased structuring options, lower entry tickets, and broader exposure to illiquid products. The Part II ELTIF provides the ideal platform under various (semi) open-ended strategies marketed in a more harmonised way to a broader investor base
• Considering the cost of setting up and ongoing maintenance (administration costs, transparency, and distribution), umbrella structures (such as running vintage programmes) help achieve substantial economies of scale while facilitating management from an operational standpoint
• SICAV-SA is likely to become the preferred form for funds established under the Part II ELTIF regime because it combines the flexibility of variable capital with control through a manager-owned general partner, along with an opaque legal form that is typically preferred for (semi) open-ended structures with retail capital

The new French ELTIF regime, particularly through the “Green Industry Law” adopted on 23 October 2023, and further complemented by the ordinance of 3 July 2024, on the modernisation of French alternative investment funds, provides fund managers with a highly attractive and modernised investment toolbox while expanding the investor base.

Key features include:

• Eligibility conditions for ELTIF 2.0 funds have been modified to facilitate investor access to these products, notably through life insurance products, the PEA (French equity savings plan), and the so-called PEE-PER (French company savings plans and retirement savings plans). These new provisions aim to support the development of French ELTIF 2.0 by redirecting savings toward the real economy
• FPS (Fonds Professionnel Spécialisé) and OFS (Organisme de Financement Spécialisé) are expected to become the preferred structures for French ELTIF 2.0, with the possibility of being structured in various forms, including a newly created structure as a non-legal entity: the Special Limited Partnership Company (Société de Libre Partenariat Spéciale). This new structure retains the key features of the classic Société de Libre Partenariat, such as limited partnership, management bodies, and limited liability for limited partners
• To encourage capital risk mutual funds (FCPRs) and real estate collective investment undertakings (OPCIs) to obtain the ELTIF 2.0 label, FCPRs and OPCIs labelled as ELTIFs will, for a period of two years starting from 10 January 2024, have the option to be governed by the more flexible rules of ELTIF 2.0 FPS to avoid certain investment and diversification constraints

The new Irish ELTIF regime, effective from 11 March 2024, offers a streamlined structure for managers, enhancing speed to market.

Key features include:

• ELTIFs can be established as a Retail Investor ELTIF, a Qualifying Investor ELTIF (subject to Retail Investor ELTIF Rules, with a minimum subscription/commitment of €100,000), or a Professional Investor ELTIF. They can utilise various legal structures like ILP, ICAV, PLC, Unit Trust, or CCF. ELTIFs can also be established as sub-funds of an umbrella ELTIF
• A Retail ELTIF can be a sub-fund of an existing umbrella Retail Investor Alternative Investment Fund (RIAIF), while a Qualifying Investor ELTIF and a Professional Investor ELTIF can be sub-funds of an existing umbrella Qualifying Investor Alternative Investment Fund (QIAIF). Umbrella structures provide segregated liability among sub-funds
• Local rules for QIAIFs and RIAIFs are generally disapplied for ELTIFs, eliminating gold-plating requirements and offering greater flexibility than non-ELTIF AIFs. For example, Central Bank of Ireland requirements such as subsidiary rules, loan origination, and private equity rules do not apply to ELTIFs
• Qualifying Investor ELTIFs and Professional Investor ELTIFs are subject to a minimum subscription/commitment of €100,000 and benefit from a long-established fast-track 24-hour approval process, thus minimising establishment costs and significantly improving speed to market for ELTIFs seeking to raise capital from sophisticated high-networth individuals and institutional investor
• Co-investment vehicles and loans to qualifying portfolio companies are also permitted

We can guide you during the entire initial onboarding process to make sure your fund is set up properly and to prepare the launch to investors.

• Fund accounting and reporting set up
• Share class: performance equalisation set-up
• Fee set up
• Fund information sheet/on-boarding tracker
• Assistance with a full regular authorisation and approval process
• Fund-raising document repository
• AIFM and regulatory hosting
• Investment management services
• AML/KYC RegTech SaaS offering powered by MaxcomplyTM
• Ability to connect with broader banking distribution (i.e Vestima etc)

• SFDR compliance services (SFDR disclosures, ESG policies and procedures, data collection, periodic disclosures)
• Regulatory reporting: AIFMD Annex IV reporting, PRIIP KIDs/EPT, EMT, Solvency II/TPT/SCR and EET
• Know Your Asset (AML/KYC verifications on assets)
• Risk management and support services, including the on-going monitoring of ELTIF and fund’s prospectus restrictions, portfolio analysis
• Liquidity management services
• Portfolio and valuation reporting and oversight
• Risk management including reporting, portfolio analytics and data access
• Diligence on delegates (including investment manager and advisors)

We have the in-depth knowledge of all capital markets, both liquid and illiquid, necessary to carry out hybrid fund accounting.

• Bookkeeping and accounting
• NAV/valuation reviews, fee accruals
• Financial statement preparation and statutory reporting
• Performance fee calculations
• Waterfall models
• Tax filings and compliance

With IQ-EQ Cosmos, you can easily access your portfolio, fund, and deal performance metrics, along with essential information such as accounting records, carry, and management fees, all presented intuitively on any device.

It accommodates both liquid and illiquid investments and can be customised to meet your specific style and requirements. The platform’s real value lies in its ability to provide detailed reporting on underlying deals, whether you are a fund of funds or a direct investment manager. With continuous upgrades and new features being rolled out regularly, our clients’ deal teams can now generate investor reports with added commentary directly from their Cosmos dashboards, saving time and enabling efficient self-service. Connected to our Data Platform, IQ-EQ Cosmos leverages our industry-leading data warehouse capabilities (powered by Snowflake), helping you make informed decisions based on accurate and quality data and analytics. We offer more than just a portfolio monitoring platform; our team also supports data collection at the asset level, dashboard configuration, and document management.

We support you in all aspects of servicing your investors.

• Investor AML/KYC (onboarding and ongoing) powered by MaxComplyTM
• Booking of investor transactions (ongoing)
• Registrar services including investor queries
• Registrar services – investor reporting
• Cash management (subscription / redemption)
• FATCA and CRS
• Capital calls/commitments (LP structure)
• Distributions