London CIV, the collaborative venture established by London Councils on behalf of the 32 London boroughs and the City of London Corporation, has become the first such scheme to be fully authorised in the UK by the Financial Conduct Authority.
The collective investment vehicle (CIV), an Authorised Contractual Scheme (ACS) and the first of its kind for the UK pensions industry, will enable the London authorities to achieve unprecedented economies of scale and potentially enable access to opportunities for investment in alternative asset classes that may not have previously been easily achievable for individual funds.
Designed to be an investment route for members’ Local Government Pension Scheme (LGPS) assets, it is also a proactive response to the government’s LGPS pooling agenda as announced in the Budget and reinforced by George Osborne in his party conference speech.
“London local government has been leading the way in developing proposals for greater collaboration across the Local Government Pension Scheme,” said Mayor Jules Pipe, Chair of London Councils. “I am extremely proud of what has been achieved by everyone involved in setting up London CIV, which is already delivering significant financial benefits for the boroughs, the pension scheme members and local tax payers.”
Hugh Grover (pictured), Chief Executive of London CIV, says: “It has been a real privilege to be leading this ground-breaking project on behalf of the London boroughs. We are now focussed on opening our first sub-fund before Christmas, an active global equities fund managed by AllianzGI, and will open a further eight sub-funds by the end of this financial year, giving us around £6 billion of assets under management. Overall the boroughs have some £25 billion of assets and throughout next year and beyond we will be opening more sub-funds covering the full spectrum of asset classes in response to the boroughs needs.”
London CIV is authorised by the FCA as a full scope AIFM with permission to operate a UK Authorised Contractual Scheme fund as a QIS.
An ACS is a Financial Conduct Authority regulated tax-transparent fund domiciled in the UK. Enacted into UK regulation in July 2013, the ACS aligns the UK investment funds regime with other European jurisdictions offering tax-transparent pooling vehicles. It is exempt from income tax and chargeable gains and enables investors to access their appropriate tax rate
