The Société de Libre Partenariat: A New French Fund Alternative

June 28, 2016

The implementation of the AIFM Directive has afforded the French legislature the opportunity to simplify its range of regulated investment vehicles, with the aim of making France’s financial markets more attractive – both to French and international institutional investors.

In August 2015, as the French asset management industry was faced with growing international competition, the French legislature enacted a law creating a new category of fund – the société de libre partenariat (SLP) – a type of alternative investment fund with legal personality (personnalité morale). A main goal in the creation of the SLP was to establish a new category of fund comparable to the English limited partnership or the Luxembourg société en commandite simple / spéciale (SCS/SCSp).

The creation of the SLP as a new corporate form of specialized professional fund (fonds professionnel spécialisé, or FPS) may be the French answer to European and international competition and enable French managers to take advantage of the AIFM Directive passport. Indeed, the SLP is designed to address key demands of foreign investors, as a vehicle allowing for operating rules similar to those applied abroad, having a legal personality, and benefiting from a tax treatment that is more easily understood by investors’ own tax authorities. A chart of the main characteristics of the French SLP is set forth in the Appendix.

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