Registration of an investment fund in Estonia
Due to changes in legislation 3 years ago, it was possible to attract third party funds to investment funds in Estonia. A new type of management company has appeared - managers of alternative (small) investment funds. The country has become an attractive jurisdiction for persons planning to register a small investment fund or management company, whose activities are based on the principles of co-investment, professional management and minimization of financial risks for the participants.
Signs of small investment funds in Estonia
The activities of small alternative investment funds in Estonia are strictly controlled and may only be carried out with a licence. Their distinguishing features are:
- Participation of non-professional investors in the fund's activities;
- A fund cannot attract more than 150 investors in one and the same EU country;
- 2 500 000 EUR per year - the maximum total value of the fund's parts for all participants.
There are certain restrictions on the licence for small investment funds to operate. Those apply only to small alternative funds with the form of management of "trust partnership" and the total amount of property of less than 100 000 000 EUR.
Obtaining a management company license
The process of registration of an investment fund in Estonia starts with the preparation of a set of documents (founding documents, identity cards and payment of contributions of participants, business plan, and information about the selected audit firm). The next step is the preparation of an application to the regulator and payment of the state duty in the amount of EUR 1000. Applications for licenses are considered by the Financial Supervision Authority within 2-6 months after payment of the commission.
It is also advantageous to open an investment fund in Estonia 2020 and obtain a licence for it to operateoperate because the current legislative framework of the jurisdiction allows for combining the management of fiat assets with cryptocurrency activities.