Investment Funds in Luxembourg: RAIF, SIF, SICAR - Comparison
Mickaël LOC
Investment Funds Specialist ·
Investment Funds in Luxembourg: RAIF, SIF, SICAR - Comparison
Alternative investment funds in Luxembourg are mainly structured around three vehicles: the RAIF (launch in 2 to 4 weeks, without direct CSSF supervision), the SIF (CSSF authorisation in 4 to 8 weeks, strong regulatory label), and the SICAR (venture capital and private equity, full IRC exemption). Luxembourg is the world's second-largest asset management centre with more than €5 trillion under management.
RAIF - Reserved Alternative Investment Fund
The RAIF (Reserved Alternative Investment Fund) was introduced in 2016. It is not directly supervised by the CSSF, but must be managed by an authorised Alternative Investment Fund Manager (AIFM). It is the fastest solution to implement (no direct authorisation of the fund required).
- No direct CSSF supervision (very short launch time: 2-4 weeks)
- Mandatorily managed by an authorised AIFM
- Reserved for well-informed investors (minimum €125,000 investment)
- Can take the form of an SCSp, SARL, SA, or SCA
SIF - Specialised Investment Fund
The SIF (Specialised Investment Fund) is directly supervised by the CSSF. It is suitable for managers wishing to display a strong regulatory label to institutional investors. Its authorisation time is around 4 to 8 weeks.
SICAR - Investment Company in Risk Capital
The SICAR is dedicated to venture capital and private equity. It must invest exclusively in securities representing risk capital. It benefits from a full exemption from IRC (corporate income tax) and VAT on its income linked to eligible investments.
| Criterion | RAIF | SIF | SICAR |
|---|---|---|---|
| CSSF supervision | No (via AIFM) | Yes | Yes |
| Launch time | 2-4 weeks | 4-8 weeks | 6-12 weeks |
| Minimum investors | €125,000 | €125,000 | €125,000 |
| Investment policy | Unrestricted | Unrestricted | Risk capital only |
Are you structuring an investment fund in Luxembourg? Our specialists support you in choosing the vehicle, setting up the structure, and managing relations with the CSSF.
Frequently Asked Questions
What is the difference between a RAIF and a SIF?
The RAIF is not directly supervised by the CSSF (indirect supervision via the authorised AIFM), which allows a launch within 2 to 4 weeks. The SIF is supervised by the CSSF and benefits from a strong regulatory label, but requires 4 to 8 weeks for authorisation.
What is the minimum investment amount for a RAIF?
The RAIF is reserved for well-informed investors. The minimum investment amount is €125,000, or the fund must certify that the investor has the expertise to assess the risks of the investment.
Can a SICAR invest in any asset?
No, the SICAR (Investment Company in Risk Capital) must invest exclusively in instruments representing risk capital: shares, convertible bonds of unlisted companies, shareholder loans. It is dedicated to private equity and venture capital.
In what legal form can a RAIF be set up?
The RAIF may take the form of a SCSp, SARL, SA or SCA. The SCSp is the most commonly used for private equity funds because of its tax transparency and flexibility.
Is an AIFM required to manage a RAIF?
Yes, the RAIF must be managed by an alternative investment fund manager (AIFM) authorised by the CSSF, or by a competent authority of another EU Member State, in accordance with the AIFMD directive.
