Worldwide: A Guide To Selling Regulated Investment Funds In Asia

1. INTRODUCTION

During the last thirty-five years Ireland has become a major hub for cross-border distribution and is one of the leading EU "exporting" jurisdictions for investment funds, for both UCITS and non-UCITS. More than 1,000 international fund promoters from over 55 countries use Ireland as their domicile of choice for fund products and seek to access not only the European marketplace but also markets outside the EU including the main Asia-Pacific markets.

Ireland is the number one hedge fund centre in the world and Irish UCITS funds are distributed in over 80 countries worldwide. Wherever your fund is domiciled, it can be serviced out of Ireland – 30 languages and 28 currencies are fully supported here. In particular, Japan, Hong Kong, Singapore, and Korea have become popular jurisdictions into which asset managers choose to market and sell their funds with particular acceptance of UCITS (the European "gold standard" product) in those markets.

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You can find out more facts and figures about the Irish Funds industry here.

Ireland is an internationally recognised jurisdiction with membership of the EU, Eurozone, OECD, FATF and IOSCO. These memberships are valued and none of these memberships will be relinquished by Ireland.

Ireland does not operate a banking secrecy regime and with openness, transparency, and regulation as the pillars of the industry, Ireland leads the global industry in compliance with internationally agreed tax standards, further evidenced by volunteering for a peer review by the G20 and OECD countries. Ireland cooperates with all EU states based on the European directives, and the Irish Central Bank has signed Memoranda of Understanding with 44 countries including China, Dubai, France, Hong Kong, Isle of Man, Germany, Japan, Jersey, Malaysia, South Africa, Switzerland, Taiwan, United Kingdom, and the USA.

Ireland offers a wide variety of fund vehicles across the full range of fund products from plain vanilla and alternative UCITS, hedge funds and funds of hedge funds, to private equity and real estate, as well as a developed legal and tax infrastructure. The continued growth in the funds industry in Ireland is helped by a competitive environment in which wide selection of fund service providers offer a value for money service. A commitment on the part of the Irish regulatory authorities, notably the Central Bank of Ireland and Euronext Dublin, to adapt and develop regulations to keep pace with developments in the funds industry internationally assists this growth. Euronext Dublin is the leading stock exchange globally for the listing of investment funds.

Why Ireland

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The categories of investment funds which may be established in Ireland comprise UCITS, which are funds established under the regulations implementing the European Union's ("EU") UCITS Directives, and funds which are established pursuant to domestic Irish law which are generally referred to as "non-UCITS" or Alternative Investment Funds ("AIFs"). In the context of AIFs, the Alternative Investment Fund Managers Directive 2011/61/EU provides for the passport by Alternative Investment Fund Managers of qualifying AIFs to professional investors throughout the European Economic Area. In this regard Irish domiciled AIFs may also be used to access the main Asia-Pacific markets subject to the various requirements being satisfied.

As of May 2021, the total number of Irish domiciled funds (including sub-funds) reached 8,162 with total net assets of €3,644 billion (Source: Central Bank of Ireland). Of this total number of Irish domiciled funds and total net assets, UCITS funds accounted for 4,973 of the total with total net assets of €2,766 billion and AIFs accounted for 3,189 of the total with total net assets of €878 billion. All key fund promoters appear on the list of Top 50 Promoters of Irish Domiciled Funds. Additionally, there are 480 investment managers (from 50 different countries) providing services to Irish domiciled funds (Sources: Central Bank of Ireland and Irish Funds).

Dillon Eustace Asset Management and Investment Funds team advises international and domestic asset managers, banks, insurers, pension funds, supranational organisations, prime brokers and other counterparties, fund administrators and custodians, securities lending agents and others in relation to all aspects of the asset management and investment funds industries. Our Asset Management and Investment Funds practice has been, and remains, one of the firm's core activities with Dillon Eustace partners having been to the forefront of the Irish industry from its beginnings in the late 1980s to the present day.

We advise across all product types, from UCITS to the full spectrum of alternative products such as hedge funds, funds of hedge funds, real estate and private equity funds, the team advises on product design, authorisation and launch, prospectus and contractual documentation negotiation, interaction with regulators and exchanges, funds listing and tax issues, bringing to bear in-depth knowledge and expertise, product innovation and a "can do" attitude. Additionally, Dillon Eustace has established a dedicated Foreign Registrations Unit to centralise the firm's existing experience and relationships as regards foreign registrations to create a more efficient and effective service for clients with respect to their foreign registration requirements. The Foreign Registrations Unit works closely with each client's legal contacts within Dillon Eustace to ensure that foreign registrations/approvals are received in a timely manner so that relevant marketing may commence as soon as possible. The Foreign Registrations Unit can assist clients seeking to access both European and non-European markets.

In this publication we have set out the various requirements for marketing a regulated Irish fund in Australia, Hong Kong, Japan, Korea, Malaysia, China, Singapore, Thailand, and Taiwan whether as a public offering or on a private placement basis. We would like to emphasise that this publication should serve as a general information guide only and does not purport to represent legal or tax advice. In the event of an Irish fund being sold or marketed in any of the jurisdictions referred to in the publication, specific legal advice should be sought in advance from local legal advisors who can be contacted through us.

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