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HKVCA comments on "Proposals to establish a Limited Partnership Regime for Funds"

Wednesday, August 28, 2019


(HKVCA Technical committe) - HKVCA represents a majority of the Private Equity firms based in Hong Kong and shares FSTB’s desire to cement Hong Kong’s position as the leading cross-border Private Equity centre in Asia. We believe the creation of competitive onshore fund legal-entities is an important part of the updating needed for Hong Kong to retain its leading position. The creation of a new, flexible, state-of-the-art Limited Partnership law is essential to enable this.


The general framework set out in the paper is excellent – and most of the key ‘must have’ features are included in the Proposals. We have some comments (see below) that mostly relate to clarifying details and optimizing flexibility for users. The details do, however, matter.


There are changes taking place to fund arrangements in the Caymans which are causing Private Equity firms to re-consider their structures. Hong Kong can benefit from this, if it can introduce attractive legislation soon.


We emphasise that Private Equity investors are using Limited Partnership vehicles in Cayman Islands, US, UK and elsewhere. The Hong Kong Limited Partnership has to be at least as competitive as these other jurisdictions if we are to persuade firms to select a Hong Kong fund entity over other, well established, regimes.

 

View full submission here