Segregated Portfolio Companies

A single company set up to deal with downside liability management. In the BVI companies law, this type of company is provisioned for. It is a virtual cell structure, you only need one company but below it there could be several specific cells, which could mirror a Brazilian managers local onshore fund offerings. You can have a segregated portfolio for a hedge fund strategy, and another alongside for a private equity fund. So long as the fund is set up in accordance with the guidelines, your investors will only have exposure to the upside or downside of the specific cell. Its something worth considering for a Brazilian manager looking to launch offshore, as it allows greater flexibility under a single roof.

We also got an update on what is happening in the BVI, the Securities Investment Business Act, and replaces the existing mutual funds act of 1996. It extends the coverage and brings the BVI into full compliance international standards. Not much impact on managers though as the overwhelming majority already comply with best industry standards.