26 October 2015
Private placement in Luxembourg a good choice for business
A good option for raising capital
Raising capital through private placement in Luxembourg brings with it many advantages, particularly as an alternative to initial public offering.
There are many reasons for this; not only does raising capital through private placement negate the need for brokers or underwriters, it can also be a cheaper and more efficient way of securing capital, particularly for the start-up or higher risk venture.
Private placement is also a useful way to ensure the right kinds of investor who can add value to transactions, while all the time enabling a business to retain its private status.
Private placement in Luxembourg
Luxembourg is a popular jurisdiction for raising capital through private placement for many reasons.
For example, Luxembourg is one of just a few member states to require only the minimum AIFMD (Alternative Investment Fund Management Directive) National Private Placement Regime requirements. This means that although it is incumbent upon businesses to report to regulators, to prepare annual reports and to disclose information to investors, Luxembourg has not imposed further obligations such as those required in Germany and Denmark, each of which have imposed a "depositary-lite" requirement.
Furthermore, from July 22, 2014, non-EU AIFMs have been required to comply with the third country provisions of the AIFMD, while Luxembourg has also signed cooperation agreements with all 34 regulators from those non-EU Countries that have agreed memoranda of understanding with the European Securities Markets Authority.
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