Alternative investment fund registration is an option for investors who want to invest in non-equity investments. It offers a host of benefits, including counterparty risk coverage and tax exemptions on profits. Read the article to learn more about the features offered by this kind of registration, as well as other aspects that might interest you.
What is a Registered Alternative Investment Fund
This article will help you to better understand what an investment fund is, why it is so important for investors to be aware of the benefits and disadvantages of Registered Alternative Investment Fund Registration.
The term “Registered Alternative Investment Fund” or RAF can sound like a complicated term, but this article will help clarify what it means and how it can affect your investments.
Alternative Investment Funds (AIF) are an investment vehicle through which the capital of a fund is invested in alternative assets such as private equity, hedge funds, and venture capital. This type of fund is not regulated by the Securities and Exchange Commission (SEC) but is instead registered with the Financial Services Authority in organizations such as Luxembourg or Guernsey. The responsibility for registering an AIF falls on both the provider of the fund and individual investors in that fund.
Rules for Registration of AIFs in India
AIFs are required to submit a registration application to SEBI before the commencement of their operations. The AIF will need to provide its business proposal and the investment structure, as well as the details of the manager and any sub-managers. It needs to also provide details of any person who might exercise control over it.
Benefits of Registration
Registration is the only way to take advantage of incentives that are set up by the government. It can get you access to share classes that are less expensive. It also ensures that your fund is eligible for certain tax benefits.
Process of AIF Registration
The process of AIF registration includes filling out the necessary forms and paying an application fee. You will also need to provide the details of your company, your products, and your sales channels. Once the registration is complete, you’ll have access to investment opportunities in many countries.
CRITERIA FOR ELIGIBILITY:
- An AIF that has been granted registration under a specific category is not permitted to modify its category after it has been approved by the Board.
- A company’s Memorandum of Association (MoA), a trust’s Trust Deed, or an LLP’s Partnership Deed grant authorization to conduct AIF’s business.
- The Trust Deed is duly registered under the Registration Act of 1908 if the applicant is a Trust.
- If the applicant is a Limited Liability Partnership (LLP), it has been lawfully incorporated and the partnership deed has been filed with the Registrar of Firms in accordance with the Limited Liability Partnership Act, 2008.
Alternative investment funds have been set up to accommodate the needs of different types of investors. Funds can either be open or closed, and you’ll need to research them thoroughly before deciding which is right for you.