Authorised Contractual Scheme (Acs)

The Authorised Contractual Scheme (ACS) is a relatively new investment vehicle that has been established in the UK. It is designed to provide a flexible, tax-efficient way for investment managers to structure their funds.

An ACS is a type of collective investment scheme that is authorised by the Financial Conduct Authority (FCA). It can be used to pool together a range of assets, including stocks, bonds and property, and allows investors to participate in the profits and losses of the scheme.

One of the key benefits of an ACS is that it can offer tax advantages to both the investment manager and the investors. For example, the investment manager can benefit from reduced administration costs and more flexibility in the management of the fund. Meanwhile, investors can benefit from tax-efficient returns, as the fund is structured to minimise tax liabilities.

ACSs were introduced in the UK in 2013 as part of the government`s efforts to create a more flexible and competitive investment market. Since their introduction, they have gained popularity with investment managers both in the UK and overseas.

There are a number of different types of ACS that can be established, each with its own specific structure and investment objectives. For example, an ACS can be structured as an open-ended investment company (OEIC), which allows investors to buy and sell shares in the fund as they wish. Alternatively, an ACS can be structured as a unit trust, which provides investors with more flexibility in how they invest.

In order to establish an ACS, investment managers must apply for authorisation from the FCA. This involves meeting a number of regulatory requirements, including demonstrating that the fund is sufficiently diversified and that investors are adequately protected.

Overall, the ACS is a powerful tool for investment managers looking to create flexible, tax-efficient investment vehicles. By taking advantage of the benefits offered by this investment vehicle, managers can provide their clients with attractive investment opportunities while also minimising their own administrative costs.

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