Comparison of alternative funds structures in Luxembourg

Decision point	RAIF	SIF	SICAR	Part II UCI	SCSp, unregulated AIF	ELTIF 2.0
What it really is	A Luxembourg alternative fund product, indirectly supervised via its authorised external AIFM.	A Luxembourg regulated fund product, usually an AIF.	A Luxembourg regulated fund product dedicated to risk capital.	A Luxembourg regulated product under Part II of the 2010 Law, often used when broader investor access is needed.	Usually the legal form chosen for private market funds, especially PE, VC, debt and carry. The partnership itself has no legal personality.	An EU long term fund label that can be added to an eligible AIF. It is not a separate Luxembourg legal vehicle.
Best one line use case	Speed plus institutional grade AIFM discipline.	Classic regulated alternatives vehicle for well informed investors.	Pure private equity or venture capital style risk capital vehicle.	Regulated alternative vehicle that can reach retail as well as professional investors.	Maximum contractual flexibility, especially for sponsor led private market structures.	Cross border long term private assets strategy, especially if retail access is a goal.
Investor base	Well informed investors only. Minimum EUR 100,000 unless otherwise certified.	Well informed investors only. Minimum EUR 100,000 unless otherwise certified.	Well informed investors only. Minimum EUR 100,000 unless otherwise certified.	All types of investors.	Depends on how structured and marketed. If it is an AIF with an EU AIFM, the AIFMD passport is for professional investors.	No investor eligibility requirement as such, retail included, subject to ELTIF rules.
Eligible strategy / assets	Very broad, all types of assets. Can also be set up in SICAR like form for risk capital only.	Very broad, all types of assets.	Risk capital only, typically PE and VC.	Very broad, all types of assets.	Very broad in practice, because it is a form, not a product law. Strategy is defined by the fund documents and, if relevant, the AIFM framework.	Long term assets, private debt, infrastructure, real assets, fund of funds, master feeder and broader long term strategies under the revised ELTIF rules.
CSSF product approval before launch	No. This is the big speed advantage.	Yes.	Yes.	Yes.	No, unless wrapped in a regulated product.	Yes, for ELTIF authorisation, on top of the underlying AIF framework.
AIFM requirement	Mandatory authorised external AIFM.	Usually an AIF, therefore usually under the AIFM regime, but the point is not as absolute as for RAIF.	Usually an AIF, therefore usually under the AIFM regime, but not conceptually as absolute as for RAIF.	If it is an AIF, the AIFM Law applies.	Depends. It can sit outside the AIFM perimeter if it is not an AIF, otherwise AIFM rules apply.	Must be an eligible AIF managed by an authorised EU AIFM.
Diversification logic	Broadly diversified if following the SIF style regime, but a RAIF can also elect the SICAR style risk capital route.	Diversification required. Since Circular 25/901, the current framework is more nuanced than the old headline 30 percent rule. For well informed or professional investors, the CSSF baseline is generally 50 percent per issuer / asset / vehicle, with possible derogations and specific rules.	No classic diversification rule, but strict risk capital purpose.	Diversification required. Under Circular 25/901, the baseline is generally 25 percent for unsophisticated retail investors, rising to 50 percent for well informed or professional investors, with special infrastructure thresholds and possible derogations.	No product law diversification by itself. Depends on strategy, documents and, if applicable, AIFM constraints.	ELTIF has its own asset eligibility, diversification and borrowing rules under the EU regime, revised materially by ELTIF 2.0.
Minimum capital	EUR 1.25m within 24 months.	EUR 1.25m within 24 months.	EUR 1.0m within 24 months.	EUR 1.25m within 12 months, with specific rules for self managed SICAV/SICAF.	No fund law minimum capital as such at the partnership level, although the chosen GP form may have its own company law capital rules.	Depends on the underlying vehicle, often a Part II UCI or another eligible AIF, plus ELTIF overlay.
Speed to market	Fastest of the regulated style options. Major selling point.	Slower than RAIF, because CSSF product approval is needed.	Slower than RAIF, because CSSF product approval is needed.	Usually the slowest among these mainstream options, because it is regulated and often operationally heavier if retail is targeted.	Potentially very fast structurally, but distribution and AIFM analysis can still be complex.	Slower than plain RAIF or plain SCSp, because ELTIF adds another regulatory layer.
EU passport angle	Yes, via the EU AIFM, to well informed investors across the EU. In practice, the AIFMD passport is for professional investors, but the RAIF product itself is limited to well informed investors.	Yes, if the SIF has an EU AIFM and qualifies as an AIF.	Yes, if the SICAR has an EU AIFM and qualifies as an AIF.	Yes to professional investors if it has an EU AIFM. Without ELTIF, no automatic EU retail passport.	Yes to professional investors if it is an EU AIF with an EU AIFM.	This is where ELTIF stands out. It was revised to make EU wide marketing, including to retail, much more practical.
Governance focus	Board quality plus AIFM oversight, because there is no direct CSSF product supervision.	Traditional regulated fund governance, board, delegates, depositary, auditor, CSSF oversight.	Board governance is critical because asset valuation, conflicts and strategy execution can be highly judgement based.	Particularly important on valuation, liquidity, disclosure and investor protection, especially if a wider investor audience is targeted.	Governance often sits primarily at GP and AIFM level, not at the partnership itself, because the SCSp has no legal personality.	Governance intensity is high, because distribution, liquidity, valuation and long term asset fit must all work together.
Where an independent director adds the most value	In evidencing real challenge in a fast launch, indirectly supervised structure.	In a classic regulated product where credibility matters to investors and the CSSF.	In concentrated, judgement heavy private equity or venture capital structures.	In balancing broader distribution ambitions with strong governance discipline.	On the GP board and sometimes the AIFM, where real control must sit.	In proving that product design, liquidity and investor disclosures are actually coherent.
Typical sponsor profile	Alternatives sponsor who wants speed, flexibility and an institutional feel.	Sponsor wanting a classic Luxembourg regulated fund for sophisticated investors.	Private equity or venture capital sponsor wanting a purpose built regime.	Sponsor seeking broader investor access, often semi retail or retail.	Private market house wanting maximum legal flexibility and sponsor control.	Sponsor wanting private market exposure with an EU retail or broader cross border angle.
Main strength	Fast, flexible, credible.	Established, respected, regulated.	Best legal fit for true risk capital.	Retail capable, regulated, versatile.	Most flexible architecture.	Best route when long term private assets and EU retail distribution matter.
Main drawback	Must have an external authorised AIFM, and no direct CSSF product label.	Slower and more regulated than RAIF.	Narrower, because risk capital only.	Heavier governance and operational burden.	Less “off the shelf” for distribution, governance has to be built carefully around GP and AIFM.	Extra regulatory complexity, so not the simplest starting point.

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