Maples has recently expanded into Luxembourg. What were some of the key reasons behind this expansion?
Our expansion into Luxembourg was driven by a number of factors. If we had to characterise these, they would fall into two broad but obviously interrelated categories: geopolitical/regulatory developments and client needs.
We have provided domiciliation, accounting and fiduciary services from Luxembourg for over 12 years. It was, therefore, a natural evolution to add legal services.
We have had clients ask that we provide the same complementary services in Luxembourg that we already provide from the Cayman Islands, Ireland, the British Virgin Islands and Jersey.
Strategically, we want to be the pre-eminent law firm for funds, finance, corporate and tax in each of these jurisdictions.
How will the Luxembourg set-up complement Maples’ pre-existing offices?
We can now advise on Luxembourg law and are thus able to provide jurisdiction-agnostic legal advice in relation to five of the world’s pre-eminent financial and fund centres to a client base that is truly global and increasingly active in a number of these locations in addition to their home jurisdictions.
Almost without exception, the other offices of the Maples group serve clients who have fairly substantive interests in or exposure to Luxembourg already.
On the domestic front, our affiliate MaplesFS currently has more than 65 staff and a daily need for Luxembourg legal advice for the clients already serviced by MaplesFS.
The ability to offer our clients a seamless service offering, to the exacting standards that they expect, is a real differentiator and allows our clients to focus less on project management, and more on their core business, all in the knowledge that their issues are being handled by a cohesive group of competent and like-minded professionals who have the same core values and solutions focus.
Our clients and referral partners have already experienced the “Maples difference” and the feedback thus far has been universally positive and invigorating to us all.
In what ways will this office be able to provide euro-centric solutions?
Together with our law firm colleagues in Dublin and in collaboration with our MaplesFS offerings in Dublin and Luxembourg, we can cover the needs of clients in the two major EU hubs for international fund and financing offers, so we have post-Brexit Europe pretty much covered in the cross-border/international business sense with the offerings across legal and fiduciary service lines.
Our experience has shown, however, that the Luxembourg and Irish service offerings have appeal and real value beyond the borders of the EU and EEA and a large number of the clients we act for also have needs in the Cayman Islands, the British Virgin Islands, Jersey and in our 13 other global locations.
We have already been involved in a number of structures that cover a combination of these locations and, in collaboration with other law firms, in the US, the UK or various Asian, European and South American countries.
What structure trends have you been noticing lately? What is popular?
We have seen, across the group, an increasing appetite for parallel fund structures, usually with a combination of US, Cayman and either Luxembourg or Irish funds.
These structures are typically used by clients who target a global fund raise. The same type of clients also often employ “mini-master” fund structures, where the European fund acts as the master fund, with feeder funds set up for non-European investors, usually in Delaware and the Cayman Islands, depending on the specificities and location of the investors.
The master fund then acts as a pooling vehicle and all investments are channelled through the European master fund.
The reality is that there is no single correct answer for all clients – the best structure depends on a combination of considerations, including (among others) the client’s target markets for fundraising, the types of investors targeted, the investment strategy, and the client’s own regulatory footprint.
We have found that the combination of being able to offer truly jurisdiction neutral advice, our deep understanding of investor needs and preferences and our knowledge of the global environment in relation to fund and finance transactions and terms enables us to guide clients and lead counsel through the ever-increasing legal and regulatory landscape to the most beneficial and workable structure for their specific circumstances.
Are you specifically promoting your Luxembourg legal offering to attract new business?
Not in particular. As I’ve mentioned, the launching of the Luxembourg law firm was a direct consequence of the need to meet our clients’ and referral partners’ existing needs.
We are obviously communicating that we have significant Luxembourg capability, both in terms of the law firm and the fiduciary business. We have nearly 100 people on the ground in Luxembourg already, and both businesses are growing at a very good rate.
The primary objective is to meet existing clients’ needs but we are confident that we will grow our business by means of providing excellent service to existing clients of the group and by positioning ourselves to provide the same level of service to clients who may not yet be clients of Maples.
Turning to Luxembourg-specific structures, what should managers consider when choosing between Ucits, Sifs, Raif, Partnership vehicles and other structures available in Luxembourg?
A number of different factors come into play and the correct answer will depend on various considerations: the asset class and investment strategy of the fund, the “quality” or status of the investor universe the client has relationships with or wants to market to, the specific sub-sets of investors within those groups (i.e. pension plans, banks, other funds or discretionary asset managers, high net worth individuals, retail investors, etc.).
The location and status of the investors, any special considerations applicable to those investors (or sub-sets of investors), the management models and marketing strategy of the manager, among others.
For example, even though an unregulated fund may be suitable, investor preference may dictate the use of a regulated fund instead. The best result for one manager is not necessarily the best result for another, even if they consider themselves part of the same peer group.
Luxembourg offers a wide variety of fund structures and each has a specific role to play. If there was one correct answer for all managers, the other options would disappear.
This is obviously a strength of Luxembourg as a jurisdiction, but it also means that clients can get lost in the nuances and that there are often a variety of structures that work for a specific fact set.
The key is to guide clients to the best solution and to do so without confusion or delay, and this is what the Maples group excels at — we provide clients with the best solution for their particular needs and we cut through the perceived complexity to provide the most suitable solutions with the least amount of hassle and we aim to get to that conclusion swiftly.