What Is the Legal Framework for a UCI Part II Fund? - #292-281*

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We examined together some foundational structures used for impact finance funds: the specialised investment fund (“SIF”), the investment company in risk capital (société d’investissement en capital à risque - “SICAR”) and the reserved alternative investment fund (“RAIF”). A fund set up under Part II of the amended law of 17 December 2010 relating to undertakings for collective investment (a “UCI Part II Fund”) is also used for impact finance. 

A UCI Part II Fund is primarily governed by the amended law of 17 December 2010 relating to undertakings for collective investment

The law of 12 July 2013 on alternative investment fund managers (the “AIFM Law”) is also applicable to UCI Part II Funds.

If UCI Part II Funds invest in short-term assets and have distinct objectives offering returns in accordance with money market rates, or where UCI Part II Funds intend to preserve the value of the investment, they must comply with the EU Regulation 2017/1131 on money market funds.

UCI Part II Funds shall also comply with applicable national regulation(s), as well as EU regulations (on anti-money laundering, the amended markets in financial instruments Directive (“MIFID II”), derivatives, securities and general corporate law).

References: the amended law of 17 December 2010 relating to undertakings for collective investment; Which Structures Are Mainly Used in Impact Finance? August 21, 2020, Bertrand Mariaux; How to set up a UCI Part II Fund, Luxembourg for Finance, January 2019.

Contributor: Cédric Buisine, Avocat

Editor: Hannah Seulgee Jung 

*Podcast #292:

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*YouTube Video 281|: 

Bertrand Mariaux, Avocat à la Cour, LL.M. (hons.)

Prestation de serment (Swearing-in oath): Luxembourg (2011), Certificat d’Aptitude à la Profession d’Avocat, École de Formation professionnelle des Barreaux de la Cour d’appel de Paris (2009), Bond University (LL.M. (distinct.), International Legal Practice, 2010), Université Sorbonne Paris Nord & University of Limerick (Master in European & International Law - major in economics, 2008), certified Expert in Microfinance (Frankfurt School of Finance & Management, 2015), social entrepreneurship (University of Oxford, 2015 & The Wharton School of Social Policy & Practice, 2014) and social & solidarity economy (International Labour Organization Academy - Social & Solidarity Economy, Organisation Internationale du Travail - Économie Sociale et Solidaire, 2017)