What is a CCIV, and who has similar structures globally?

A CCIV is a new type of company whose creation was primarily driven by Australia’s need to be more acceptable to overseas investors. The existing investment structure of trust-based entities and people didn’t match overseas investors’ way of getting things done.

Being a company, it issues shares, not units in a unit trust, to investors which is far more acceptable on an international basis.

While it has the powers, rights, duties, and characteristics of a company, and it is subject to the ordinary company rules under the Corporations Act, it has some new peculiarities.

Firstly it has a special constitution to enable it to become an investment fund with an umbrella structure. In addition, this CCIV is managed by a new regulated role called a Corporate Director. The Corporate Director holds an AFSL and is the sole director on the board of the CCIV. He can delegate his responsibility, and usually does by appointing the investment manager to manage the fund.

Regimes, similar to the CCIV are flourishing elsewhere.

• In the United Kingdom, the Open-Ended Investment Company OEIC went live in early 1997. Just under 4000 OEICs have been established to date with a market size of around 4 billion pounds which makes the average funds size just over one billion pounds.
• In Ireland, the Irish Collective Asset-Management Vehicle (ICAV) was established in 2014 and today, there are around 400 of them in operation. The Irish have probably gone the furthest in terms of commercialisation as many of the sub-funds have been listed on the Irish Stock Exchange. In Australia, it will also be possible to list CCIVs on the ASX, but only one per CCIV and the CCIV can only have one sub-fund if it wants to list in the ASX.
• Hong Kong has had its Open-Ended Fund Company (OFC) since mid-2018 and just over 200 have been registered to date with the Hong Kong Securities and Futures Commission.
• Singapore’s version of the CCIV is called the Variable Capital Company (S-VACC). It was introduced in early 2020, and in the past two years, 400 have been established in the city-state by asset managers, predominantly by family offices but also by hedge funds and private equity.

CCIVs are poised to flourish now in Australia. If you want to discuss, establish or manage them please leave a note here!

For more information, we suggest you visit a website specialising in CCIVs … CCIV.INFO