Interest in alternative investment products and hedge funds within France, coupled with the restriction on French resident investors investing in unlisted collective investment schemes, has led a significant number of French promoters to list their products on the Irish Stock Exchange ("ISE"). In the past months a number of promoters have approached Dillon Eustace with a view to listing French fonds commun de placement ("FCP") vehicles on the ISE. Following a number of submissions and meetings, the ISE has recently given its approval in principle for the listing of such vehicles, thereby expanding the range of vehicles which may be listed on the ISE to investment companies, unit trusts, limited partnerships and FCPs.
What is an FCP?
An FCP is one of the two principal types of collective investment scheme which can be established in France, the other being a sociÈtÈ d'investissement ‡ capital variable ("SICAV").
FCPs are similar to the familiar unit trust product in that they have no legal personality and are essentially pools of assets jointly owned by the subscribers for units in the FCP who have an undivided proportional interest therein. FCPs are managed by an investment company and their assets are held with a custodian. FCPs are regulated by the Commission des Operations de Bourse (the "COB"). An investor in an FCP receives redeemable non-voting units of participation. Each unit represents an undivided proportional interest in the FCP's underlying assets.
There are different kinds of FCP which are subject to specific investment and marketing rules including: venture capital funds or fonds communs de placement ‡ risque ; futures funds or fonds communs d'intervention sur les marchÈs ‡ terme; new technology funds or fonds communs de placement dans l'innovation ; and employee savings funds or fonds communs de placement d'entreprise. It is anticipated that all types of FCP, save employee savings funds, will be suitable to list on the ISE.
Regulatory Status: The majority of FCPs may be listed as retail funds, as they are regulated by the COB. However, certain sub-categories of FCPs known as "FCP ‡ procÈdure allÈgÈe" are not required to be pre-authorised by the COB. These FCPs are restricted under French law to sophisticated investors. While still supervised by the COB, such FCPs will be considered unregulated by...