English
SpanishMaximizing Luxembourg and its potential in wealth structuring for family businesses: The RAIF alternative
The Grand Duchy of Luxembourg is widely recognized as one of the most important financial and investment centers both within the European Union and globally. Its strategic position in the heart of Europe and its favourable regulatory environment have made it an attractive destination for international investors and businesses.
From this stable and favourable environment for foreign investment and international planning, family businesses can benefit in their aim to implement a comprehensive process that seeks to ensure the continuity and sustainable growth of the family wealth across generations.
Such businesses face unique challenges due to the intersection of family and business aspects. Therefore, a long-term vision involving the family in defining shared goals and values must be established. A corporate governance protocol should be established, including conflict resolution mechanisms and incorporating external professionals who can provide a unique and balanced strategic vision facilitating a smooth intergenerational transition, ensuring that emerging family leaders are prepared and committed to the company’s values and objectives.
OEL Fund Services has always positioned itself alongside Family Offices and families with high net worth and successful business founders to help them plan and channel their wealth using solid, flexible, recognized, and tax-efficient structures based in top-tier financial centers such as the Grand Duchy of Luxembourg.
In the pursuit of peace of mind and with the aim of perpetuating wealth from generation to generation while maximizing returns and minimizing tax risks, OEL Fund Services has identified and developed specialized niches such as the use and implementation of Reserved Alternative Investment Funds (RAIF), combining solid knowledge in fund management with high technical specialization in wealth planning and international taxation, with a team dedicated specifically to the Spanish-speaking market (LATAM and Spain).
RAIF funds are established without the need for authorization from the regulator (CSSF) and benefit from structuring elements that were previously only available to regulated Alternative Investment Funds (AIFs) (umbrella structure, variable capital, specific tax regime). It is a versatile and attractive solution for investors in alternative funds of all types.
“OEL Fund Services has always positioned itself alongside Family Offices and families with high net worth and successful business founders to help them plan and channel their wealth using solid, flexible, recognized, and tax-efficient structures based in top-tier financial centers such as the Grand Duchy of Luxembourg.”
Thanks to the flexibility of the RAIF, it is possible to switch to SIF or SICAR regimes if greater investor protection at the fund level is needed. Similarly, SIFs and SICARs can relinquish their regulatory status to be included in the RAIF model.
The RAIF can invest in any asset class, such as infrastructure, real estate, private equity, hedge funds, debt acquisition, lending, etc.
It is important to note that, as with any investment, investors should conduct thorough due diligence and, in many cases, seek professional advice before investing in alternative investment funds. The diverse and often complex nature of these strategies requires deep understanding and careful assessment of associated risks. At OEL Fund Services, we are committed to providing comprehensive support from the outset, ensuring that each stage of the conception, analysis, set-up, and daily monitoring process occurs smoothly, providing high added value appreciated by all our clients.
Authors
