Investment Funds in the Czech Republic

Collective Investment Vehicle (CIV) is a modern Czech investment instrument that complies with European MiFID directives and is intended for all categories of assets. Funds registered in form of SICAV can be a respectable option for bigger investment projects.

SICAV is a joint stock company with a variable statutory fund; it is a special legal form created for use in the field of investment funds. SICAV takes as a basis a traditional joint-stock company, but at the same time gives investors the opportunity to freely enter and exit this fund. In SICAV, the constituent and investment parts of the fund are separated from each other by the charter or by creating sub-funds. In accordance with this division, SICAV issues two types of shares – constituent shares (intended for founders), with which the right to vote is associated, and investment shares (for investors) with the right of redemption and, most often, without voting rights.

To raise capital. Investment funds are one of the best ways to raise capital for your own projects or investment strategies. And it is perfect for combining the capital of partners in the joint business tasks implementation.

To benefit from preferential fund taxation. One of the notable features of SICAV investment funds in the Czech Republic is the 5% profit tax at fund level, against the standard corporate rate of 21%.

To implement a wide range of business tasks. With the help of investment funds it is possible to invest and manage all types of business anywhere in the world (real estate, enterprises, securities, issue and take loans, etc.). For example, in the Czech Republic the largest real estate companies operate through their own investment funds. At the same time, they create sub-funds for the individual projects implementation.

We have many years of experience in the investment field, and we constantly monitor the development of legislation and market trends. Use our advice from the very beginning, and you will get much more than if you do it all on your own.

Contact us and already during the first consultation we will be able to evaluate the feasibility of creating (registering) an investment fund for you, your business and for solving your problems.

What are the advantages of an investment fund in form of SICAV in the Czech Republic?

• Ability to raise capital — investors can enter and exit, with a clear and transparent structure.
• Investor details are not published in the public commercial register.
• Investor protection — supervision by the Czech National Bank and oversight by the fund’s depositary.
• Straightforward distribution of shares in the fund’s assets.
• Shares can be transferred to third parties without procedural obstacles.
• Operates within the EU regulatory framework: registered with the Czech National Bank and subject to Czech AML legislation implementing the EU directives.
• Compliance with European law on investment companies and funds.
• 100% foreign ownership of the fund is permitted.
• A broad investment mandate across asset classes and strategies.
• EU membership gives access to the European market and to counterparties across the Union.
• An extensive network of double taxation treaties.

Note! SICAV is an Qualified Investors Fund:

• is intended for qualified (experienced and professional) investors, institutional and private;
• the minimum amount of investment to the fund from the investor is 125 000 EUR;
• can be used in all investment strategies and directions and their combinations;
• can be established as a single entity or as a structure with sub-funds.

When managing an investment fund, the services of several entities are used as standard, among which the main role is played by the manager, administrator and depository. Their practical activity depends on the parameters by which this investment fund operates.

Fund management

The fund manager deals mainly with investment and risk management. Most often, the fund is managed and administered by an investment company (not a self-managed fund) or the fund is self-managed (a self-managed fund).

Fund Administrator

The administrator is engaged in activities related to the issuance and redemption of securities, accounting, calculating the value of net assets, communicating with investors and other entities, valuation and other activities necessary for the operation of the fund. He is a registration agent, maintains a register of shares, maintains contacts with shareholders, is responsible for accounting and other aspects of the fund.

Depository

Assets storage, control and monitoring are carried out by the depository of the fund. The task of the depositary is to take care of the fund assets and conduct control activities, within which it conducts accounting and control of financial activities, issuance and redemption of securities, setting value of securities and others. The depositary acts on the basis of a depositary agreement and in the interests of the fund and its investors. In its activities, the depositary cooperates with the manager and administrator of the fund.

Auditor

The requirements for the transparency of the fund’s activity oblige the fund to submit its annual reports to independent auditors, as well as inform the Czech National Bank and the fund’s investors about the annual reports.

• Full consultation before creating or buying of an investment fund;
• Evaluation of an investment plan or an existing asset portfolio;
• Creating the structure of the qualified investors fund and benefits and costs analysis;
• Selection of a licensed management company based on your needs and conclusion of an agreement with it;
• Company registration;
• Statutory documents development;
• Documents for the Czech National Bank (CNB) preparation;
• Fund submission to the CNB;
• Support during licensing process in CNB
• Selection and opening of depositories and bank accounts for an investment fund;
• Elaboration of financing methods and further capitalization of the fund’s assets;
• Selection of a professional auditor, appraiser, tax consultant and accountant.