Some small investment funds are relatively easy to set up in Slovakia and are not expensive to run

Some small investment funds are relatively easy to set up in Slovakia and are not expensive to run. For most of them, however, a major disadvantage is the range of investors to whom these funds can be distributed. These are primarily professional investors, and (apart from some legal entities) the criteria for a professional investor are set quite strictly at the pan-European level. For example, meeting the criterion of ten significant trades in financial instruments on the relevant market per quarter, over the previous four quarters, can be quite difficult from the perspective of an investor wishing to invest in a small investment fund with a property-focused investment policy, for example. The European Commission’s proposal to relax the professional client (investor) criteria therefore appears to be an important and welcome initiative in this respect. For example, in addition to halving the value of the criterion of the size of the portfolio of financial instruments (to an amount exceeding EUR 250 000 on average), it is proposed to add a fourth criterion, that of education or training. Thus, an investor wishing to be classified as a professional investor on his/her own application would already have to meet 2 out of 4 criteria (not 2 out of 3 as is currently the case), which has the potential to significantly broaden the range of investors to whom small investment funds in Slovakia can ultimately be distributed. We have described this legislative proposal in more detail with Peter Varga in the following article: https://lnkd.in/eKkQbWAW. At the same time, the topic of distribution of small investment funds and other topics, for example, related to collective investment in the field of real estate, will be discussed at the conference “Real Estate – Taxes and Financing”, which Highgate Law & Tax is organizing on 21.11.2023 at the Grand Hotel River Park. A link to the conference page (with the schedule and individual speakers) can be found in the comments.