Jersey: How Fund Managers Are Currently Establishing Listed And Private Funds In Guernsey
Last Updated: 17 January 2017

This interview first appeared in Hedge Fund Law Report.

Craig Cordle recently joined Ogier's investment funds team as a group partner based in Guernsey. Cordle counsels his clients on all aspect of structuring, restructuring, merger, cross-border marketing and operation of investment funds and other collective investment arrangements.

In connection with his move to Ogier, The Hedge Fund Law Report recently interviewed Cordle during which he shared his views on the current state of the funds market in Guernsey, the complexities and nuances in launching exchange-listed funds and how law firms are meeting the current needs and demands of their fund clientele. Cordle provides valuable insight to any fund manager considering these funds or Guernsey as a jurisdiction, in addition to all fund managers wrestling with fee considerations.

Q:  What drew you to practice law at Ogier in Guernsey?

A:  After working at Herbert Smith Freehills in London for quite some time, I moved to Norton Rose Fulbright. I thought I would stay there for a long time, doing the same sort of work, but the opportunity to join Ogier caught my interest.

Having spent the better part of ten years setting up mostly offshore vehicles, which tended to be based in Guernsey, coming to Ogier looked to be the obvious move and a great opportunity to focus on what I really enjoy doing. Like London, there is a small pool of premier law firms in Guernsey doing this type of work, and Ogier has a corporate and finance practice to complement its investment funds practice.

Q:  As your career has advanced, have the fund products you have worked with grown more complex?

A:  It's possible that some of the underlying investments have grown more complex – for example, listed funds investing into a portfolio of collateralized loan obligations. However, the actual investor-facing structures are not necessarily more complex. It's often important to make sure that there are not too many bells and whistles to these funds as all material information will need to be written down and disclosed to investors. If an investor cannot understand, or the product is overly-complex, they may not invest.

Listed funds may seek a listing in multiple jurisdictions, with the gold standard being the Main Market of the London Stock Exchange (LSE). As they are listed, funds which are overly complex may face problems which it comes to review by the relevant regulator. Generally speaking, listed closed-ended funds will be more complex or nuanced than their open-ended cousins.

In my experience, particularly innovative or specialist products that were not suitable for the Official List of the Main Market ended up being listed on the Specialist Fund Segment of the Main Market of the London Stock Exchange, with various other specialist fund products – such as aircraft and funds with non-voting shares.

Q:  You describe the LSE's Main Market as the gold standard. Do you see others moving to take advantage of it?

A: For a certain period from around 2007 onward, many funds sought to be listed on Euronext Amsterdam, which wasn't (with the benefit of hindsight) necessarily the best platform for them. Most have now moved to the LSE, or are dual-listed on both markets. I must have worked on four or five of these over the past few years.

It's quite a small world in London in terms of listed funds. There are eight, nine or ten investment banks or brokers that we see regularly selling these sort of products. They would act as the sponsor, which is a requirement to get the fund listed on the Official List, maintained by the Financial Conduct Authority (FCA) acting in its capacity as the U.K. Listing Authority.

Q:  In what jurisdictions do the funds you work on tend to be domiciled?

A: Guernsey is where the bulk of the funds I've set up have found a home. Some have been in Jersey, but most have been in Guernsey. Traditionally, real estate funds tend to be organized in Jersey; Guernsey picked up everything else.

In the last couple of years, we've seen U.K. investment trusts also being utilized. It all comes down to the tax structuring for the fund, but the manager's regulatory position is also a significant consideration. Some investors may occasionally mandate that the vehicle has to be onshore as well.

Q:  What are some of Guernsey's other advantages in the funds market?

A:  For a non-E.U. fund (which also has a non-E.U. manager), if you file an Article 42 notification with the FCA and only market the fund under the U.K's private placement regime, you've got the best of both worlds.

If you can keep everything offshore in Guernsey, your costs will be lower too. As soon as you're in the U.K., the operational costs increase. Additional service providers, such as depositaries, will be required and the overheads are naturally higher.

Q:  Do you have any predictions with regard to Guernsey's performance?

A:  I expect Guernsey to continue on an upwards trajectory. Statistics from the Guernsey Financial Services Commission show that the twelve months leading up to June 2016 saw a 12.3% increase in the net asset value of all funds under management and administration to £247.1 billion. As an asset management lawyer, those figures are very encouraging.

Q:  How are clients reacting to developments on the regulatory front?

A:  A manager's fund structure isn't set in stone. With all the current regulatory initiatives – in particular those aimed at tax transparency and prevention of tax avoidance, such as Base Erosion and Profit Shifting (BEPS) sponsored by the Organization for Economic Cooperation and Development – structures need to be flexible.

I'm interested to see how the implementation of BEPS unfolds. Are we going to say that some funds suddenly don't have sufficient substance in a particular jurisdiction? I very much doubt that will be the case. It's been difficult and I think clients have become nervous; in some cases legitimate tax structuring has been muddled in the media as being somehow improper.

Q:  How would you describe the impact of AIFMD?

A:  The Alternative Investment Fund Managers Directive (AIFMD) added an extra layer of complication to structuring funds.

It's widely accepted as well that AIFMD has not achieved what it set out to do. The ideal situation that many managers and brokers are looking for is an offshore investment fund, where the manager is not required to comply with the full panoply of regulations under AIFMD but can still sell the fund into the U.K., which is the primary market for these vehicles. Fortunately, the U.K. has taken a more sensible approach to implementation and interpretation of AIFMD.

Q:  How much does pressure on fees make itself felt in the space you work in?

A:  Since I've been doing this, it has become harder for lawyers to win mandates. These sort of funds are specialized, and fees are certainly higher than with your traditional open-end vehicles, hedge fund-type vehicles and Undertaking for the Collective Investment of Transferable Securities (UCITS). It is simply a function of the amount of regulation that has evolved; AIFMD; the listing rules; disclosure and transparency guidance; and the prospectus rules.

We're seeing a noticeable price squeeze from clients and underlying investors who are trying to reduce fees. When you're working for top tier law firms, making it profitable is very difficult. The pressure on fees is significant for lawyers given the amount of regulation we now have to take into consideration when launching these funds.

Q:  What are the most important priorities for clients in this market with respect to their external counsel?

A:  For a client, in terms of choosing legal counsel, it's about getting a balance between quality and fees. Working at Herbert Smith Freehills and Norton Rose Fulbright, we were trained to leave no stone unturned when structuring these vehicles. For me, it was important to know that Ogier works in the same way too.

Taking this approach, all service providers will have completed significant levels of due diligence on these structures. What we are being pushed to do more frequently is to commoditize that work. In the listed fund space, which is subject to a reasonably substantial level of regulation, this is difficult to do.

Outside of the listed fund space, new Guernsey products – such as the manager led product and, more recently, the private investment fund – are very positive announcements, which may help streamline the set-up of these vehicles, whilst also keeping costs down and investor protection and regulation at levels commensurate with the level of risk involved.

Q:  How have clients' needs and expectations changed?

A:  In terms of how clients' needs have changed, the burden on investment managers for compliance is pretty high. Consequently, there can be quite a bit of handholding when setting up these vehicles, which we are obviously happy to do.

At the moment, most investors are looking for yield. With investment funds in London, ideally you want 5% net yield; that gets it onto the radar of the institutional investors. Otherwise, you're fighting an uphill struggle, even with some very interesting propositions.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Press Releases from this Firm
Recent Content from this Firm
By Bertrand Geradin
By Charles Le Maistre
By Claire Smith, Jonathan Dauny
By Katharine Marshall
By Nicholas Brookes
By Simon Lofthouse
By Bradley Kruger, Michael Robinson
By Nicholas Burkill, Nicholas Brookes
By Raulin Amy, Sally Edwards, Steve Meiklejohn
By Gavin Ferguson, Alice Bricogne, Sandie Lyne
Font Size:
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions