More that 60 guests attended the conference entitled a�?legal vehicles & structures to hold and invest in art a�?orgnized by LAFA during TEFAF on March 18th. The event was graced by the presence of Guy Arendt, Luxembourgish Secretary of State for Culture and several of his high ranking advisors.
Alain Mestat, LAFA President, gave a short welcome introduction on LAFAa��s activities before AndrA� PrA?m, LAFA Vice President, started moderating the panel discussions.
Several existing solutions such as the SIF SICAV and SIF SICAR where presented, as well as Securitization solutions, illustrating the breath of available tools as well as their respective advantages for UHNW collectors.
All panellists did agree that liquidity is the biggest issue faced by art funds: How do managers generate liquidity in order to pay for the operational costs of the fund, how do get investors their money back if they have to redeem early. All of these issues need to be carefully addressed when establishing a fund which pools investors money in order to invest in asset which are inherently illiquid.
Valuation, provenance, authenticity are all crucial elements while investing in art and a fund manager needs to be particularly careful in addressing these essential issues.
Alex Schmitt presented the new Reserved Alternative Investment Fund (RAIF) which should be enacted into Law by July 2016. The RAIF is a non CSSF regulated alternative for individuals interested in setting up passion related investment funds. Despite the fact that the RAIF is not directly regulated by the CSSF, it will have to be supervised by a regulated AIFM entity, providing investor with adequate peace of mind as to the management of the fund.
- Tonika Hirdman discussed the goals and benefits of an art foundation, stressing that overall it
- is about sharing a passion with a wider audience. For that purpose, Luxembourg and the
- Fondation de Luxembourg presents many advantages for collectors interested in engaging in
- art philanthropy. The stability of Luxembourg, both economically and politically, the strong
- and international financial centre, a multilingual environment and a dedicated platform, the
- Fondation de Luxembourg, makes the country a place of choice for setting up an art
After the two hour conference all guests were able to visit TEFAF courtesy of David Arendt, CEO of Le Freeport.
From the left to the right. David Maria (Wildgen, Partners in Law), Edouard da��Anterroches (Arendt & Medernach), AndrA� Prum (Vice President LAFA), Tonika Hirdman (Director General of Fondation de Luxembourg), Alex Schmitt (Managing Partner Bonn & Schmitt)