FINANCIAL services company Castle Trust Group aims to make it easier for capital from Europe to be invested in Asian funds amid tighter regulations within the European Union (EU).
Chairman Steven Knight said yesterday: “If you have an Asian fund, you can’t market it in the EU. It’s a criminal offence.”
Mr Knight was referring to the Alternative Investment Fund Managers directive, which in 2013 made it illegal for fund managers and trustee professionals to market non-European funds within the EU, including those from Asia.
“But because of the volatility in the European market, more Europeans would still like to invest in Asia,” he added.
Castle Trust Group is based in Gibraltar, a small British- administered island off the Spanish south coast that has been actively positioning itself as the gateway to the EU for non-EU fund managers.
The firm has a range of options to enable Asian fund management companies to tap European investors.
These include setting up an onshore fund that has EU authorisation or establishing a feeder EU fund to collect investor money that would then be put into the fund in Asia.
Another option, added director Neil Gogan, would be to list on the newly launched Gibraltar Stock Exchange. “This will give you visibility in Europe,” he said, noting that a listing can be completed within four to six weeks, a fraction of the four to eight months normally taken in other jurisdictions.
Mr Gogan said doing business in Gibraltar is “cost-effective” – a boon for setting up Asian funds in Europe, given the high costs in other traditional fund domiciles like Luxembourg.
Mr Knight added: “The two-way flow of business (via Gibraltar) is currently very under-utilised. If we can get this going, it will be a win-win situation for us both.”