LEGAL AND TAXATION ASPECTS FOR CLOSED FUNDS IN AUSTRIA AND GERMANY

Closed funds are offered as public funds and private placements. Public funds are offered especially by banks and savings banks, as well as free financial service providers to the public. In contrast private placements are offered to a very small circle of major investors. As a result of this, the investments are accordingly higher [1]. Taking this special position in account, the prospectus duty can be cancelled. The important exceptions are to be found if the public offer is accepted by less than 100 people and if the amount of capital invested reaches more than 50,000.00 EUR [2]. Regarding the content the prospect has to include all information which enables the investor to form a solid and overall judgment about the financial and profit situation of the emitter including the developing views. The prospect has to be checked by a prospect controller in order to guarantee the validity of content and its integrity [3]. A prospect exception is only possible if a German prospect includes an Austria appendix highlighting the specific features for Austrian investors, in particular tax conditions and drawing obligations. The profit-tax issue of German non-incorporated firms, treated in Germany and Austria is handled in a transparent way. Income is defeated to the taxation with the single companion, hence, by investor [4]. The participation form can be initiated immediately or indirectly in form of a trust relationship. The regulation of the taxation of the addition is based on the world income principle and double taxation agreement [5].