Elliot Refson

Further amendments to Jersey’s Limited Partnership Law have been approved, aiming to give fund managers  more flexibility in their international fund structuring.

Jersey Finance hopes the amendments will modernise the jurisdiction’s regulatory framework, recognising trends and developments in the international funds environment.

The amendments include the introduction of protections for the limited liability of partners by expanding ‘safe harbour’ provisions, where participation in the management of a partnership is concerned.

Further amendments include: the introduction of greater flexibility through allowing third parties to have enforceable rights under partnership agreement while not being a partner of the limited partnership; new reporting obligations to ensure the register is kept up to date, including a new annual confirmation requirement; a clear termination process; and the introduction of wider amendment powers by way of a secondary legislation to facilitate quicker legislative change in the future.

The limited partnership is used in cross-border fund structuring, particularly within the private equity and venture capital asset classes. It is a popular structure for its tax neutrality and limited liability.

The latest amendments follow those made in 2020, when a statutory basis for limited partnerships to be migrated from other jurisdictions was introduced.

The move aimed to provide greater legal certainty for managers and investors and resulted in a significant uptick in limited partnership fund structures moving to Jersey.

Elliot Refson, head of funds at Jersey Finance, said:

“We have a strong track record when it comes to evolving and enhancing our ecosystem for alternative funds.

“These latest amendments will be welcomed by the industry as a further demonstration of our innovative approach and our ambition and capability to support high quality private equity and wider alternative fund structuring."