New research shows Guernsey is most popular fund domicile

More managers have their funds domiciled and administered in Guernsey than any other jurisdiction, according to the results of a new survey carried out independently by www.funddomiciles.com.

It shows that 24% of managers have their funds domiciled in Guernsey compared with 21% in the UK, 18% in Jersey, 12% in Cayman and 9% in Luxembourg. Malta, Ireland, the Isle of Man, BVI, Cyprus and the US make up the rest of the fund domiciles.

The survey results also reveal that 24% of managers have their funds serviced from Guernsey, followed by the UK (20%), Ireland (18%) and Jersey (16%). The rest of the managers have their funds serviced in Luxembourg, Malta and the Isle of Man.

A key finding from the interviews with fund managers is that Guernsey has built a strong position in the private equity space, in particular.

These results build on the fact that Guernsey was the highest placed jurisdiction to show the most improvement with a move up to third position in the www.funddomiciles.com Stability Index 2011 and 61% of respondents in a Private Equity News / State Street survey of Chief Financial Officers (CFOs) said that Guernsey was their preferred location for private equity outsourcing.

Peter Niven, Chief Executive of Guernsey Finance – the promotional agency for the Island’s finance industry, said: “The results of this survey show that significant numbers of managers continue to choose to use Guernsey as a fund domicile and in particular, the Island is considered the jurisdiction of choice for private equity. We are very pleased with the results and especially because not only is it research which has been carried out independently but it also builds on a significant body of other work which shows that Guernsey is one of the foremost fund domiciles globally and a leader for private equity.”

The research from www.funddomiciles.com is entitled The Future of the UK Offshore Domiciles and is based on a representative sample of 50 UK-based alternative investment fund managers, including those from the private equity, property and hedge fund sectors.

The accompanying commentary includes reference to the fact that “Guernsey has received a number of very positive comments…It has the reputation of being a stable domicile with a good regulator and solid reputation. It seems to have established a very strong position in private equity and real estate management, in particular.”

It goes on to say that the threat of the AIFM Directive, which was taken very seriously in all three UK offshore centres, seems to have dissipated. “Nobody interviewed has said that they would be redomiciling funds from the UK offshore centres as a result of this Directive,” it says. The commentary adds, however, that a number of respondents are redomiciling funds into the EU from Caribbean jurisdictions.

One of the fund managers responding to the survey said: “We like Guernsey because of the quality of its service providers and the ease of access from London.” Another fund manager said: “Guernsey is the place to be in our industry [private equity].” One of the other selected responses featuring in the research report said: “The keys to domicile selection are stability and reputation. Guernsey has this.”

Commenting on the survey results, Patrick Firth, Chairman of the Guernsey Investment Fund Association (GIFA), said: “These results reinforce the fact that Guernsey has built a reputation among managers for our expertise in servicing the widest range of funds and in particular those investing in alternative asset classes and especially private equity. This served us well through the financial crisis and subsequent economic downturn, ensuring that we fared better than many of our closest competitors. It is also a message we will building upon during the year and in particular, at the Guernsey Funds Forum in London in May.”

The Guernsey Funds Forum will be held at the Grange St Paul’s Hotel in London on Wednesday 2 May and will culminate in a keynote debate featuring Lord Lamont and Economics Editor and Broadcaster Stephanie Flanders. The debate and the preceding panel sessions will be moderated by ITV News Anchor, Alastair Stewart.