Background 
 
Establishing a properly regulated offshore investment fund is not as difficult or expensive as is often imagined. The Isle of Man Experienced Investor Fund (EIF) regime provides a user friendly, flexible and inexpensive route into the world of private hedge funds.
 
The promotion of such a fund offers an unparalleled opportunity for financial professionals such as financial advisors, accountants, legal practitioners and fund managers to provide their clients with specialist investment opportunities of their own selection in a cost effective and administratively straightforward manner.
 
What is an Experienced Investor Fund?
 
EIFs are being used extensively as investment vehicles within Europe and beyond for asset classes as diverse as eastern European property investments, Indian film production and commodity funds.  The regime provides a simple, flexible and inexpensive solution to the complex needs of sophisticated individuals, market professionals and global asset managers while seeking to provide comfort to investors by ensuring proper disclosure and administration. The EIF regime enjoys the following benefits;
 
In accordance with section 21 of the Financial Services and Markets Act 2000 and the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001, UK financial professionals can promote the fund to their existing clients and contacts.
                 

No Prospectus is required under Manx law. Instead a simple offering document is intended to include all the information required to enable an informed investment decision.

EIFs are frequently able to be ‘linked’ to offshore life insurance products, which provides attractive tax benefits for UK based investors as well as an excellent route to market for the fund Promoters.  

No regulatory approval is required in the Isle of Man to launch a Fund, provided the administration is undertaken by a licensed administrator.

‘Funds’ are exempt from the regulatory requirements of the Isle of Man Financial Supervision Act 1988.

The Legal form of the Fund can be as an Open Ended Investment Company (OEIC), Unit Trust or Limited Partnership. A Fund must make proper arrangements for ‘Custody’ of the investment ‘Property’ usually with a custodian bank.

An ‘Experienced Investor Fund’ can apply for exemption from tax in the Isle of Man.