These detailed Frequently Asked Questions (FAQ’s) have been put together to cover key aspects of your investment into any SICAV based Balux Capital Fund. If you have any further questions not covered please email info@baluxcapital.com.
Contents – Frequently Asked Questions – for the SICAV
Fund Structure
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1. Why Luxembourg?
2. What Investor Protection do Luxembourg based funds offer?
3. What exactly is a SICAV and a Specialised Investment
Fund (“SIF”)?
4. Balux Capital s.à r.l
4.1. Who is Balux Capital s.à r.l?
4.2. How long has Balux Capital been managing funds?
4.3. What is the management style of Balux Capital?
5. Balux Capital Funds
5.1. Is Balux Capital regulated?
5.2. Who acts as advisor to ensure
full investor protection?
5.3. Are there restrictions as to
who can invest in the Balux Capital Funds?
5.4. Can I register shares in the
name of a Trust?
5.5. Can my associates regularly
be sent a copy of the funds’' reports?
5.6. Do you send out statements?
6. Buying Units in the Fund – Subscriptions
6.1. If I subscribe, how much of my subscription money actually gets
invested?
6.2. What is the minimum amount that I can invest?
6.3. Is there an initial charge payable on subscriptions?
6.4. What documentation do I need in order to invest?
6.5. Where do I send the subscription money and documents to?
6.6. Can I buy shares through my insurance company bond or SIPP or
equivalent?
6.7. Can I buy shares through my financial advisor?
6.8. What is the best way to send my subscription payment?
6.9. What types of share certificates are provided?
7. Selling Units in the Fund
7.1. What is the price at which shares are sold?
7.2. What do I need to do in order to affect a sale of my shares?
8. Fund Prices and Performance
8.1. Where are the funds’ latest returns available?
8.2. Who calculates the funds’ prices?
9. General
9.1. Do the Funds fall within the scope of the European Union Savings
Directive?
9.2. Whom do I contact to invest in the Balux Capital Funds?
1. Why Luxembourg?
Luxembourg is Europe’s Number one investment centre and the world’s
leading hub for global fund distribution. The continuing development as
a centre of financial and investment fund services has led to a unique
concentration of specialist service providers. This unique blend of expertise
in the areas of fund administration, management and distribution enables
Luxembourg to offer fund promoters an extraordinarily wide range of investment
products. Flexible and welcoming Authorities and a close relationship between
the business community and the Government allows Luxembourg to continue
strengthening its position as one of the world’s most attractive
investment fund centres.
Luxembourg’s flexible banking and investment fund legislation and extensive network of double tax treaties have enabled it to emerge as a leading centre for international lending, investment funds and private banking. Given the strong regulatory and investor protection frameworks in place net assets under management in Luxembourg investment funds grew by 9.4% alone from January to July 2009, reaching a total of 1 706.030 billion Euros. Also see www.alfi.lu for more information.
2. What Investor Protection do Luxembourg based funds offer?
As the world’s second largest fund management centre, Luxembourg
offers the strongest investor protection scheme in Europe making
Luxembourg the safest place to hold assets. The Luxembourg structure
offers complete segregation of clients’ assets from either the creditors
of the investment firm or any of its custodian banks. All assets
must be held by a custodian bank approved by the regulator. The custodian
bank must hold all these assets in separate custodian accounts, so
they do not form part of the bank’s balance sheets and therefore
are not exposed to its credit risk. The regulatory body is the CSSF – www.cssf.lu
The CSSF ensures that the laws and regulations governing the various areas of the financial sector are enforced and observed. The regulatory framework of the Luxembourg financial sector has been developed under the co-ordination works of the European Union and the Group of Ten. It complies with international standards on high-quality prudential processes. Starting 1 January 2009, circular CSSF 08/371 of 5 September 2008 requires that Luxembourg Undertakings for Collective Investment as well as Specialised Investment Funds submit their prospectuses, simplified prospectuses and offering documents in electronic form to the CSSF. Electronic prospectuses, simplified prospectuses and offering documents receive a Visa that consists of:
- an electronic «stamp» that is added to the first page of the prospectus. This stamp includes a Visa number, the information that the Visa may not be used as a sales argument, the date of the Visa, the issuer of the Visa i.e. the CSSF and the scanned signature of a director of the CSSF.
- an electronic signature of the CSSF based on an SSL certificate issued by Luxtrust. Luxtrust is the certification authority for electronic signatures in Luxembourg.
3. What exactly is a SICAV and a Specialised Investment
Fund (“SIF”)?
A SICAV is an open-ended collective investment scheme common in Western
Europe. SICAV is an acronym for French société d'investissement à capital
variable which can be translated as ‘investment company with variable
capital’.
On February 13, 2007, the Luxembourg Parliament passed a law creating a specific legal framework for Specialised Investment Funds (“SIF”). This law replaces the law dated July 19, 1991 on collective investment funds. The SIF is a regulated, operationally flexible and fiscally efficient multipurpose investment fund for a qualified investor base.
4.1. Who is Balux Capital s.à r.l?
Balux Capital is an independently owned Luxembourg management company
which manages a series of specialist investment funds.
4.2. How long has Balux Capital been managing funds?
The company is newly formed but the team members have a long track
record of experience in the investing and fund management business, including
setting up an experienced investor fund business with assets under management
of $50mill after only 2 years and a share price increase of over 20% over
the same period and having been a general partner in a private equity fund
with close to $1bill under management. One of the principals has been in
the property financing business for more than 20 years and been involved
in more than $15bill worth of transactions. Please see more details of
the team on the website and under each specific fund.
4.3. What is the management style of Balux Capital?
We look for a balanced risk portfolio which protects the downside.
The style depends on each fund whether capital gain or yield focused.
In either, Balux Capital has a conservative approach that looks for capital
protection and a well balanced risk management approach. Hence it is
a fundamentally conservative approach that allow for both capital protection
and security of income as well as the certainty of planning for investors
future.
5.1. Is Balux Capital SICAV-SIF regulated?
Balux Capital SICAV-SIF is a regulated collective investment fund
subject to the supervision of the Commission de Surveillance du Secteur
Financier, Luxembourg (CSSF).
5.2. Who acts as advisor to ensure full
investor protection?
The Balux Capital funds activities are administered by a most reputable
team of advisors in Luxembourg, complemented by specialist advisors for
specific funds launched. The Balux Capital funds are regulated and monitored
by the CSSF in Luxembourg. See www.cssf.lu. Balux Capital provides unequalled
investor protection & security by working with the most experienced
and respected advisors in their field:
State Street Global Services, ex Mourant International – Fund Administrator
Mourant International Finance Administration is one of the world’s leading providers of financial administration services, specializing in the administration of collective investment funds, limited partnerships, unit trusts, SPVs, and other vehicles commonly used in the structuring of international financial transactions. With over US$170 billion of client commitments under administration and 650 employees, it is the leading provider of fund-administration services, particularly for alternative investments such as private equity, real estate and hedge funds. Mourant has recently been acquired by State Street, which has $1.7 trillion in assets under custody and administration, of which $420 billion are within the alternative asset class.
www.mourant.com and www.statestreetglobalservices.com
KPMG – Fund Auditor
KPMG in Luxembourg is one of the leading service providers in the Asset Management and Fund Industry with a common approach to serving clients on a multidisciplinary basis which includes Business Advisory, Tax, Regulatory, Audit, Independent liquidation, Financial Advisory. In Luxembourg, KPMG has a well established track record serving virtually all the key service providers and products. Senior Partner involved with Balux Capital is involved in INREV, ALFI and other fund governance and auditing bodies
Baker & McKenzie – Funds legal advisor
Baker & McKenzie is one of the world’s largest and most respected law firms. With a network of 5,200 legal professionals in 40 countries and 68 offices around the world, it has a true global perspective to deliver quality legal services required to respond effectively to international and local needs. It was voted the No.1 Global Law Firm and No.1 Law Firm of the Year 2009 for Asia and Latin America by PLC Which Lawyer?
5.3. Are there restrictions as to who
can invest in the Balux Capital Funds?
Yes, the issue and sale of Shares in the fund is restricted to investors,
which qualify as “Well-Informed Investors” (each a Well-Informed
Investor) as per article 2 of the law dated February 13, 2007 on specialised
investment funds (the SIF Law). A Well-Informed Investor is an institutional
investor, a professional investor or any other investor who:
| (a) | has confirmed in writing that he adheres to the status of well-informed investor; and | ||
| (b) | (i) | he invests a minimum of €125,000 in the Company; or | |
| (ii) | he has obtained an assessment made by: | ||
| (A) | a credit institution within the meaning of Directive 2006/48/EC; | ||
| (B) | an investment firm within the meaning of Directive 2004/39/EC; or | ||
| (C) | a management company within the meaning of Directive 2001/107/EC, | ||
| certifying his expertise, his experience and his knowledge in adequately appraising an investment in specialised investment funds. | |||
Balux Capital does not accept investment from US persons.
5.4. Can I register shares in the name
of a Trust?
Individuals or corporations that are investing in their capacity
as trustees of a trust must register their investment in their own individual
or corporate name. They may include as part of the registered name reference
to the capacity in which they are acting such as “as trustees of
the XYZ Trust”. However the persons in whose name the shares are
registered will be the only persons recognised as the registered owners.
5.5. Can my associates regularly be sent
a copy of the funds' reports?
Yes. Investors may indicate by written signed instructions where
extra copies of reports and notices should be sent. Documents that are
specific to the investor such as a statement of holdings will only be
sent to addresses which are authorised in writing by the registered member.
5.6. Do you send out statements?
The fund will provide a report based on the frequency indicated on
the application form or the management company can provide information
on holdings to registered members only.
6. Buying Units in the Fund – Subscriptions
6.1. If I subscribe, how much of my subscription money actually gets invested?
Depends on the initial charge of the share class you are investing
in and whether you are applying via a tax wrap or directly.
6.2. What is the minimum amount that I can invest?
The minimum initial subscription for any single share class is laid
out in the prospectus.
6.3. Is there an initial charge payable on subscriptions?
Yes, subject to the terms of the share class which you are investing
in.
Prospective Investors need to provide the Administrator with a Subscription Form, a copy of which will be made available on the website. In addition, the Administrator will require corporations to provide additional documents such as a memorandum of association and signing authorities or relevant mandates. Individuals may be required to provide copies of identification documents. All is clearly laid out in the respective application documents of the fund.
6.5. Where do I send the subscription money and documents to?
The amount being subscribed should be remitted to the funds custodian
as indicated on the respective application forms. Subscription documentation
should be sent to the funds' Administrator as detailed in the application
form. There is a fax cover sheet provided in the application pack.
6.6. Can I buy shares through my insurance company bond or SIPP or equivalent?
Yes, however, it is subject to the approval of the individual providers.
6.7. Can I buy shares through my financial advisor?
Yes. Your advisor can complete the Application Form in your name
on your behalf. Of course, you will be required to sign the form and
will be considered the registered owner of the shares.
6.8. What is the best way to send my subscription payment?
Investors should remit subscription amounts by wire transfer. These
payments may be traced and are not subject to the sometimes significant
delays in delivery and clearing. The Administrator is not permitted to
accept cash payments.
6.9. What types of share certificates are provided?
All of the shares issued are registered. This means that the official
record of ownership of shares in the funds is the share register
maintained by the funds’ Registrar.
7. Selling Units in the Fund
7.1. What do I need to do in order to
affect a sale of my shares?
For all Funds, a properly completed Funds Redemption Form must be
received by the Fund Administrator prior to the deadline as laid
out in the prospectus.
7.2. What do I need to do in order to affect a sale of my shares?
For all Funds, a properly completed Funds Sale Form must be received
by the fund Administrator prior to the deadline as laid out in the prospectus.
8. Fund Prices and Performance
8.1. Where are the funds' latest returns available?
The funds’ latest returns will be made available on the website.
8.2. Who calculates the funds' prices?
The funds’ published prices are calculated by the Administrator,
State Street Global Services (Luxembourg).
9.1. Do the Funds fall within the scope of the European Union Savings
Directive?
Our assessment is that all of Balux Capital Funds are outside of
the scope of the European Union Savings Directive 2003/48/EC of 3 June
2003 on taxation of savings income in the form of interest payments. This
means that payments from the Funds, including dividends and redemption
proceeds, to residents of the European Union should not be subject to having
tax withheld by paying agents under the Directive.
9.2. Whom do I contact to invest in the Balux Capital Funds?
To invest in the Balux Capital Funds, please contact the Manager
of the funds under info@baluxcapital.com, your IFA or any other financial
intermediary who would contact us on your behalf.
