Raising funds to Russia for investment and business development and tax optimization is one of the key issues for foreign entrepreneurs. Today we will tell you about one of the non-standard tools, which, at the same time, is in high demand from foreign entrepreneurs.
Closed-end mutual investment fund (ZPIF) is one of four types of mutual funds, which in accordance with the Federal Law "On Investment Funds" can be created in the Russian Federation.
ZPIF today is a modern and dynamically developing instrument of the financial market aimed at project organizers of projects who are interested in their successful implementation and attracting investments on a long-term basis. ZPIF is a separate property complex and does not imply the formation of a legal entity. The property of the ZPIF belongs to the holders of investment units on the basis of the right of common share ownership.
Compared to open-ended, interval and exchange-traded funds, closed-end funds have the following main features:
- ZPIF is formed for a specific investment strategy, and investment shares can be redeemed only upon termination of the fund. As a rule, the investment period ranges from 3 to 15 years. This option is relevant for real estate investments, in the stock market, as well as for industrial investments.
- The presence of a special governing body - the general meeting of the investment shares owners, which makes decisions on certain issues of the fund's activities.
- Possibility of earning income for the owner of the investment unit from the trust management of the property
- Possibility to pay for investment shares in non-monetary funds
- A special procedure for the preparation and provision of professional reporting
- A special procedure for disclosing information about the activities of the fund, etc.
These features predetermine the goal of creating a closed-end investment fund - consolidation and capital management in such a way th have the opportunity to invest in low-liquid assets. In this regard, the owners of investment units of closed-end mutual funds are endowed with some managerial competencies, in particular, by a majority vote, investors can decide to change the management company, as well as the ability to receive regular income, etc.
ZPIF has a wide scope and can be:
- Mechanism for participation in development projects;
- A mechanism for competent structuring of the rental business;
- Possibility of temporary "parking" of assets (real estate, securities, shares of companies, etc.);
- Possibility of using the VTB Capital platform to access the Russian market;
- Possibility of structuring the company's assets through shares of closed-end mutual funds;
- A mechanism for conducting option programs to encourage company management;
- A mechanism for participating in the privatization of marketable assets.
In our next article, we will talk in detail about the advantages of closed-end mutual funds and the basic principles of taxation. Subscribe to our news and stay tuned.
For 10 years of work in Russia and Asian countries, the RAUIE has accumulated experience, business connections and contact base, and has also earned a high reputation and trust among the business community. Today the RAUIE offers a wide range of solutions for entrepreneurs seeking to enter the Russian market.
If you still have questions or need advice on opening a business in the Russian Federation, you can leave a request in the feedback form or contact our specialists at the contacts below:
Maxim Kuznetsov - vice-president of the RAUIE
investment@raspp.ru
WeChat: maximkuznetsov
