PIF - Professional Investor Fund

Melville is the key architect and lead advocate of the UK Professional Investor Fund (PIF) proposal:


Melville has been instrumental in designing of the PIF:

  • unauthorised contractual scheme
  • closed-ended or a hybrid
  • limited to institutional investors, with minimum £1m commitment
  • effectively tax transparent & tradable units i.e. transfers not inhibited by transaction tax
  • unlisted & operates with UK AIFMD regime: a full scope AIFM & depositary

  

PIF key attractions:


  • one of the solutions for UK productive finance fund structures
  • will enhance the UK's brand for fund and asset management
  • will enable fund management houses to facilitate the UK government's goals for COVID-19 reconstruction, infrastructure revolution & levelling up the nation
  • a "quick win" legislative solution


UK government and regulator representatives have constructively engaged with this proposal. There is widespread industry support for the PIF initiative, including from institutional investors as well as big business and SME fund and asset managers. 

 

PIF Current News:


On 26 January 2021, UK HM Treasury issued a Call for Input/CFI in which the Government is consulting on the PIF contractual scheme/CFI and other unauthorised fund structures. HMT requests responses to questions the Call for Input/CFI, including question 30 to 37 (inclusive) focused on the PIF. The CFI closed on 20 April 2021.  

 

https://www.gov.uk/government/publications/review-of-the-uk-funds-regime-a-call-for-input

 

Melville is very grateful to:

- AREF, INREV, IPF and other industry organsiations;

- fund managers, institutional investors, tax advisers, law firms and other professionals

responding to the CFI, and supporting the PIF.

Many respondents kindly utilised suggested precedent responses: responses  developed by Melville in light of kind collaboration with research, tax, regulatory specialists, senior counsel (John Virgo)  and other network contacts.

 

Download Suggested Precedent Responses

 

Let's hope that HM Treasury, taking into account the CFI responses, will progress with legislative implementation of the PIF. As indicated,the PIF  can be delivered swiftly  via a "quick-win" secondary legislative solution.


Media coverage on the PIF:

23/03/21: AREF/INREV/IPF webinar UK Treasury's Funds Review: Call for Input consultation - Implications for the Real Estate Funds Sector (recording above)

https://www.aref.org.uk/events/ems-event-calendar/member-webinar-on-uk-treasury-s-funds-review-call-for-input-consultation-implications-for-the-real-estate-funds-sector.html



18/03/21: Property Week, Professional Investor Funds (PIFs) could fill the UK fund sector gap

https://www.propertyweek.com/insight/professional-investor-funds-pifs-could-fill-the-uk-fund-sector-gap/5113195.article


24/2/21: IPE Real Assets, UK funds review: chance to create real estate fund that meets institutional needs

https://realassets.ipe.com/real-estate/uk-funds-review-chance-to-create-real-estate-fund-that-meets-institutional-needs/10050745.article


3/2/21: Property Week, Government call for input on property fund structure change

https://www.propertyweek.com/finance/government-call-for-input-on-property-fund-structure-change/5112467.article


16/12/20: Property Week, Government launches second consultation on REIT tax structure

https://www.propertyweek.com/finance/government-launches-second-consultation-on-reit-tax-structure/5111731.article


3/8/20: IPSX,  Podcast: Onshore versus offshore

https://www.ipsx.com/news/podcasts-onshore-versus-offshore/


2/7/20: AREF & IPF, Webinar: PIF Proposal Explained

https://www.aref.org.uk/events/ems-event-calendar/aref-ipf-webinar-pif-proposal-explained.html


23/6/20: AREF,  New fund vehicle proposed

https://www.aref.org.uk/resource/new-fund-vehicle-proposed.html


13/05/20: Lexis Nexis,  A Gap in the market

https://www.assetservicingtimes.com/specialistfeatures/specialistfeature.php?specialist_id=319&navigationaction=features&page=6&newssection=features


4/3/20: FTfm, UK investment body lobbies for property fund revamp

https://www.ft.com/content/f6677d00-919c-45a1-a6c1-0840b3b919ff


May/June 2019: IPE Real Assets, A new UK fund structure

https://realassets.ipe.com/brexit/melville-rodrigues-a-new-uk-fund-structure-please/10030940.article


"The time has come to modernize, standardise and regulate a form of tax-transparent closed-ended or hybrid fund.          The PIF submission is welcome and timely."


- Andrew Baum, Professor of Practice, Said Business School, University of Oxford


"There appears to be a clear and genuine need/preference for them to invest via an onshore tax-transparent vehicle. PFR estimate that only 25% of €260bn in AuM in closed-end funds launched by UK based fund managers and targeting UK and European assets in the last 10 years have utilised a UK onshore fund structure. There is a clear opportunity for the UK fund management industry" September 2020 


- Jane Fear, Director, Property Funds Research