First open-ended Private Investment Fund established in Guernsey

13 July 2017

Freedom Select Funds PCC Limited has been converted to become the first open-ended Private Investment Fund (PIF).

Freedom Select Funds (FSF) was established as a registered closed-ended fund in 2016. The fund’s investment objective is to achieve significant long-term capital appreciation by investing primarily in a managed futures programme with the excess cash to be invested in portfolio of alternative investment assets.

The fund is managed by Freedom Asset Management Limited (FAML) and is the seventh PIF to be established in Guernsey since the rules were introduced in November.

Offshore law firm Collas Crill, including Group Partner Paul Wilkes and associate Alex Wickens, advised on the conversion as lead counsel to Freedom.

Mr Wilkes said the launch of the PIF regime in November provided an opportunity to take advantage of an even more flexible, cost effective fund regime.

“Using the PIF for FSF made perfect sense as, by its intended nature, FSF was not likely to exceed the investor or subscription limits set out in the PIF Rules,” he said. “Most importantly, FAML, as manager, has the close relationships with its investors that the GFSC identified as a cornerstone characteristic of a PIF.”

Mr Wickens added: “The GFSC was happy to assist throughout the conversion process. Be that with pre-application queries to the application itself. The GFSC also clarified that its expectation is that each PIF will be established with its own manager entity free of connections to existing funds so as to reduce the risk of another fund's failure affecting the Private Investment Fund.

"However, the GFSC will take each application on a case by case basis and will consider applications by managers, such as FAML, that also manage other funds."

“Using the PIF for FSF made perfect sense as, by its intended nature, FSF was not likely to exceed the investor or subscription limits set out in the PIF Rules. Most importantly, FAML, as manager, has the close relationships with its investors that the GFSC identified as a cornerstone characteristic of a PIF.”
Collas Crill Group Partner Paul Wilkes