WHY INVESTMENT FUNDS ARE ESTABLISHED ON CURACAO, THE NETHERLANDS ANTILLES
Here are a few reasons out of many
A favorable tax regime is one reason for establishing a fund on Curacao, the Netherlands Antilles. Also, Curacao has become very attractive since under new corporate law a private limited liability company (‘besloten vennootschap’) can be established very quickly and very flexible. Virtually everything is possible with this new legal entity.
Investor considerations often drive the fund location. The Netherlands Antilles are a so-called associate member of the European Union, which makes a Netherlands Antilles fund attractive to European investors. The Netherlands Antilles are also a member of the OECD. The jurisdiction of residence of a fund has become an increasingly important issue that may seriously affect the sale of securities to regulated EU investors.
Also, from a reputational perspective certain investors are less comfortable with investing in a tax haven fund than in a fund incorporated in the EU or an associate member state of the EU.
A new regulatory regime (new National Ordinance Supervision of Investment Institutions and Administrators, National Ordinance Supervision of Trust companies and new anti-money laundering rules) provides for comfort to investors and Curacao is not listed on any blacklist (OECD, FATF). The regulatory regime focuses on full and transparent disclosure, both in the offering documentation as to the regulatory authority.
Often misunderstood, Curacao’s civil legal system can offer advantages over other established (Common Law) legislative frameworks as it provides a greater degree of stability and predictability through established legislation and a fixed ruling environment, as opposed to evolving jurisprudence. Curacao forms an integral part of a larger whole, The Kingdom of the Netherlands and the European Union, nurturing a greater degree of comfort to investors as opposed to independent territories.
Curacao is the Pearl and the Capital of the Caribbean.
Karel Frielink
Attorney (Lawyer) / Partner
(7 December 2005)
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