Private collective investment schemes

Private funds refer to collective investment schemes which limit the total number of participants to fifteen individuals and where the competent authority is satisfied that:

  1. the participants are close friends or relatives of the promoters
  2. that the scheme is essentially private in nature and purpose, and
  3. iii.the scheme does not qualify as a professional investor fund.

When dealing with Private collective investment schemes, the Authority limits its due diligence procedures to determining the integrity of the persons concerned and unlike in the case of licensed schemes, it will not assess the competence of the persons responsible for managing the Scheme; now would it subject the private fund to any investment or borrowing restrictions or other conditions other than those which may be specified in the recognition certificate
issued by the Authority.

The authority may allow for one participant to be a company if it satisfies the following:

  1. taking into account the ultimate individual beneficial owners of such company, the maximum number of fifteen participants is still satisfied.
  2. the company's ultimate individual beneficial owners are close friends or relatives of the promoters
  3. the company is in no manner involved in the management or administration of the fund and its connection with the fund is merely that of an investor.

 

Read more about the general features of the most common types of collective investment schemes availed of in terms of Maltese law:

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