GP managing more than EUR 100mio
Milo / 31.5.2021
"All partnerships in Luxembourg (SCS, SCSp, SCA) must have a General Partner ("GP").
It is mandatory, whether the partnership is below or above the 100mm EUR threshold. In fact, the GP is in charge of carrying out corporate governance and management functions for the partnership and the partnership cannot operate without a partner who is a GP.
For a GP managing one or more partnership that in total have AUMs under 100mm EUR, there is only a 'notification' requirement with the CSSF and the GP itself is considered as being a 'below-threshold AIFM'.
However, if the GP exceeds such AUM limit, it must appoint an AIFM. So the GP still continues to exist, it still carries out certain corporate governance functions for the partnership via its directors, but the investment management activity is delegated to the appointed AIFM."
VG email to client, ref. Milo answer / 8.6.2021
Abalone told me that if your AUM exceeded EUR 100 million under the GP, you would have no choice but to upgrade one or more SLPs under the GP to RAIFs and appoint an AIFM, which would cost significantly more. In effect, the GP's director would appoint an AIFM and still manage the GP. Alternatively, you may create new GP/SLP structures to stay below EUR 100M AUM at all times and avoid such an upgrade.
If your two planned investments (including equity) later exceed the EUR 100mio threshold, you may decide to split the two projects into two separate GP/SLP structures in advance to avoid this issue.
- A new service provider will replace Fundamentals on the upgraded SLP(s).
- The client can continue to maintain the other SLPs under the GP at the previous conditions.
Milo 9.6.2021
if a promoter exceeded 100mm EUR in AUMs that he wishes to manage and wants to keep the existing unregulated funds/SLPs as is, still as 'club deals', then he should just leave the GP-SLPs structure as is and just create a separate RAIF structure, which can be also a GP-SLP structure (a new one) but not necessarily, it can take any other society form whose governing body will then appoint the AIFM and the other service providers.
Input to client:
"If your total AUM on multiple SLPs exceeds EUR 100 million and you want to keep some of the existing unregulated SLPs as "club deals," you can leave the GP/SLPs structure as it is and create a RAIF from scratch to embed one or more of your larger "club deals" from the previous structure."