NETHERLANDS ANTILLES HEDGE FUNDS
The Netherlands Antilles provide a favorable climate for hedge funds
The Netherlands Antilles currently provide a favorable tax, legal and regulatory climate for hedge funds. A fund vehicle can be established very quickly and very flexible.
Also, a new regulatory regime regarding the supervision of investment institutions and administrators and new anti-money laundering rules provides for comfort to investors. It is possible in the Netherlands Antilles to discuss in advance with the tax authorities what at arms’ length remuneration will be acceptable. A tax-exempt vehicle and several very low-taxed vehicles are available for hedge funds.
There is no requirement from a corporate law point of view for a hedge fund to have any employees and it may have a single managing director (which can even be a corporate entity) who may be domiciled elsewhere. There are no specific statutory formalities to comply with in order to have meetings of the managing (or supervisory) board, such as the location thereof.
Both open- and closed-end funds are possible. There are many exclusion, exemption and dispensation possibilities from a license requirement. Master/feeder structures, multi class, umbrella funds and hybrid debt/equity structures are all possible.
For these and other reasons, I believe that the Netherlands Antilles, especially Curacao, is developing as a jurisdiction of choice, and with a decent marketing effort, this should become clear to the market.
Karel Frielink
Attorney (lawyer) / Partner
