Glowing review for Malta as a Hedge Funds Domicile (Bloomberg)

Cristina Maria Scerri | 06 Jan 2012

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The Bloomberg Markets magazine has recently highlighted Malta's attractiveness as a Hedge Fund domicile citing amongst other reasons, Malta's low taxes, its low labour costs and its EU membership. The review quotes the considerable increase in the number of funds in Malta and the various relocations of companies from well established fund jurisdictions to Malta as positive signs of a booming financial services industry. Since the end of 2010, the number of Malta hedge funds has increased by almost 30 percent and their total assets were up nearly 15 percent as of early December. In 2010, nine companies from the British Virgin Islands, seven from the Cayman Islands and six from Luxembourg switched their legal domicile to Malta whilst a considerable number of large U.K. hedge funds and funds of hedge funds of the like of Clive Capital LLP, Comac Capital LLP, BlueGold Capital Management LLP and Liongate Capital Management LLP amongst others, have shifted part of their operations, including accounting and investor relations, to Malta. The review also highlights the regulatory scrutiny and accountability of the Maltese regulatory authority (MFSA) which have become important selling points in the hedge fund industry. The MFSA is reported to be approachable but not pliable. Hedge funds can thus gain important reputational boosts by choosing Malta as their domicile. An Alfi-commissioned report has demonstrated that Luxembourg comes behind Malta in terms of hedge fund numbers (HFM Week, Issue 246, Dec 2011). The report also highlights the low set up and maintenance costs enjoyed by Malta hedge funds.

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