Offshore hedge funds are investment vehicles organized in offshore financial centers. The advantage of an offshore hedge fund is that the investors in the fund generally are not subject to taxation. Investment fund managers typically create offshore funds in Caribbean jurisdictions, although a European offshore entity may be more appropriate if a significant number of European investors are involved.
Correctly structuring an offshore hedge fund is of critical importance and is a major determining factor in its overall success. There are six major issues that must be addressed. These issues pertain to tax issues, regulatory matters, day-to-day business management, investment strategies, marketing, and back-office operations. Addressing these areas prior to creating an offshore hedge fund (or funds) eliminates problems later. It is important to understand that these are all closely related.
The typical offshore hedge fund manager seeks to create a financial investment for high net-worth and institutional investors. The key distinction with respect to offshore hedge funds is that they are not retail, publicly offered investment products, which would be subject to more stringent regulatory requirements.
Offshore Hedge Fund Locations
British Virgin Islands
www.bvi.gov.vg/
Cayman Islands
www.cayman.gov.ky
Cyprus
kypros.org/Government/
Dubai
www.uaecb.gov.ae
Gibraltar
www.fsc.gi/fsc/home.htm
Guernsey
www.gfsc.guernseyci.com
Hong Kong
www.hkma.gov.hk
Ireland
www.basis.ie
Isle of Man
www.gov.im
Jersey
www.jerseyfsc.org
Liechtenstein
www.bankenverband.li
Luxembourg
www.bcl.lu
Singapore
www.mas.gov.sg
Switzerland
www.snb.ch
The Bahamas
www.bfsb-bahamas.com