Crown Dependencies for Fund Structures: Jersey vs Guernsey vs Isle of Man

Three islands, three regulatory regimes

The Crown Dependencies—Jersey, Guernsey, and the Isle of Man—share a constitutional relationship with the British Crown but are not part of the United Kingdom. They are not EU member states. They set their own tax rates. And they each have their own financial services regulator.

For fund managers structuring vehicles outside the EU and the US, these three islands appear on virtually every shortlist. But they are not interchangeable. The regulatory approach, the cost structure, and the investor perception differ in ways that matter.

The comparison at a glance

Jersey: the institutional standard

Jersey is the largest of the three by funds under administration (over £400 billion) and has the deepest service-provider ecosystem. If you are structuring a private equity fund, a real estate fund, or a hedge fund for institutional investors, Jersey is the default choice unless there is a specific reason to go elsewhere.

Fund structures available

• Jersey Private Fund (JPF): Designed for sophisticated/professional investors. No minimum investment. Fast-track authorisation (typically 48 hours). Maximum 50 investors (or unlimited with professional investor criteria). This is the workhorse for PE and VC funds.

• Expert Fund: For ‘expert investors’ (minimum investment US$100,000 or equivalent). Broader investor base than JPF. Regulated by the JFSC.

• Listed Fund: For public markets. Full JFSC regulation.

• Unregulated Fund: Available in limited circumstances, typically for very small numbers of sophisticated investors.

Costs

JFSC incorporation: £200 (standard, 5 business days). Annual confirmation statement: £220–330 depending on whether the company is administered by a licensed trust company. JFSC fund application fees: from £2,450 for a JPF. Ongoing JFSC annual fees for funds: from £4,500/year.

All-in first-year costs for a JPF, including formation, JFSC fees, fund administrator, legal, and compliance: typically £50,000–80,000. Ongoing annual costs: £30,000–60,000 depending on the fund’s complexity and AUM.

Why fund managers choose Jersey

• Depth of service providers. Jersey has the largest concentration of fund administrators, lawyers, and auditors among the Crown Dependencies. Competition keeps quality high.

• Investor recognition. Institutional investors—particularly UK and European pension funds and insurance companies—are comfortable with Jersey vehicles. The JFSC is well regarded internationally.

• EU market access. Jersey funds can be marketed into the EU under National Private Placement Regimes (NPPR) of the AIFMD. The JFSC has cooperation agreements with EU regulators.

• Private fund regime. The JPF is specifically designed for speed and flexibility, with a 48-hour authorisation turnaround.

Guernsey: the insurance and alternatives specialist

Guernsey administers over £280 billion in fund assets and has carved out a distinct position in insurance-linked securities (ILS), captive insurance, and alternative fund structures.

Fund structures available

• Registered Fund: For qualifying professional, institutional, or experienced investors. No GFSC approval required—notification only. Very fast to launch.

• Qualifying Investor Fund (QIF): Minimum investment of US$100,000. Fast-track designation (typically 10 business days).

• Authorised Fund: Full GFSC authorisation. Required for retail distribution.

• Manager-Led Product (MLP): For licensed Guernsey managers. Minimal GFSC filing. Designed for bespoke structures.

Costs

Guernsey Registry incorporation: £100 (standard, within 24 hours). Annual validation: £260 (Category 6, non-administered) to £1,050 (Category 1, GFSC licensees). GFSC fund application fees: from £1,500 for a registered fund. Ongoing GFSC annual fees for funds: from £3,500/year.

All-in first-year costs for a registered fund: typically £40,000–65,000. Ongoing annual costs: £25,000–50,000.

Why fund managers choose Guernsey

• Speed to market. The Registered Fund regime requires notification only—no GFSC approval. This is the fastest route to launching a regulated fund vehicle in the Crown Dependencies.

• Insurance and ILS expertise. Guernsey is Europe’s leading captive insurance domicile (over 700 international insurers). For insurance-linked securities and catastrophe bonds, the ecosystem is unmatched.

• Cell company structures. Guernsey pioneered the Protected Cell Company (PCC) and Incorporated Cell Company (ICC). These are extensively used for umbrella fund structures, captive insurance cells, and segregated investment portfolios.

• Cost. Guernsey is generally 10–20% cheaper than Jersey for comparable fund structures, reflecting the slightly smaller (but very capable) service-provider market.

Isle of Man: the specialist

The Isle of Man’s fund industry is smaller than Jersey’s or Guernsey’s (approximately £50 billion under administration), but the island has strong niches in e-gaming, insurance, and certain alternative investment strategies.

Fund structures available

• Regulated Fund: Authorised by the FSA. Required for retail distribution.

• Qualifying Fund: For ‘qualifying investors’ (minimum investment £100,000). Lighter-touch regulation.

• Exempt Scheme: For professional or institutional investors. Most flexible regime.

Costs

Companies Registry incorporation: approximately £100. Annual return: £380. FSA fund application fees: from £1,000. Ongoing FSA fees: from £2,500/year.

All-in first-year costs for an exempt scheme: typically £25,000–45,000. Ongoing annual costs: £18,000–35,000.

Why fund managers choose the Isle of Man

• Cost efficiency. The Isle of Man is the most cost-effective of the three Crown Dependencies for fund structuring, with lower regulatory fees and competitive service-provider pricing.

• E-gaming crossover. For funds investing in gaming companies or for gaming operators structuring holding or investment vehicles, the Isle of Man’s deep expertise in both fund regulation and gaming regulation is a genuine advantage.

• 0% tax on financial services income. Unlike Jersey and Guernsey (which tax financial services at 10%), the Isle of Man taxes most fund management income at 0%. Banking and property income are exceptions.

• UK VAT integration. The Isle of Man is in a customs and VAT union with the UK, which can be advantageous for certain fund structures with UK connections.

Substance requirements: the common thread

All three Crown Dependencies introduced economic substance requirements following OECD and EU scrutiny. For fund management entities, the requirements are substantively similar:

• Direction and management must take place in the jurisdiction (board meetings, strategic decisions)
• Adequate employees (or outsourced equivalents) must be present
• Adequate expenditure must be incurred locally
• Adequate physical premises must exist

For fund vehicles (as opposed to fund managers), substance requirements are generally lighter. A fund that is managed by a separately regulated manager typically needs to demonstrate that its board meets in the jurisdiction and that key decisions are taken there, but does not need its own employees.

EU marketing: NPPR for all three

None of the Crown Dependencies are EU member states, so funds domiciled there cannot be marketed to EU investors under an EU passport. Instead, they rely on National Private Placement Regimes (NPPR) under the AIFMD.

All three jurisdictions have AIFMD cooperation agreements with EU member state regulators, enabling their funds to be marketed to professional investors in most EU countries under NPPR. The process varies by EU member state; some (like the UK, pre-Brexit) are straightforward, while others impose additional requirements.

For managers contemplating significant EU distribution, an Irish or Luxembourg AIFM with delegation to a Crown Dependency manager is a common structure.

How to choose

Start with the investor base. If your LPs are UK or European institutions accustomed to Jersey vehicles, Jersey reduces friction. If your investors are less prescriptive, Guernsey or the Isle of Man may offer better economics.

Consider the strategy. Insurance-linked securities or catastrophe bonds → Guernsey. E-gaming investments → Isle of Man. Mainstream PE, RE, or credit → Jersey.

Factor in cost over the fund’s life. A 10-year PE fund in the Isle of Man versus Jersey could save £100,000–150,000 in aggregate regulatory and administration fees over its life. Whether that saving matters depends on fund size and LP expectations.

Think about tax on the manager. If the fund management company itself is in a Crown Dependency, the 0% rate in the Isle of Man is more favourable than the 10% rate in Jersey or Guernsey for financial services income. This difference alone can be significant for a profitable management company.

How CompCal helps

Fund administrators and CFOs managing vehicles across the Crown Dependencies face a compliance calendar that spans annual confirmations (Jersey, February), annual validations (Guernsey, January), annual returns (Isle of Man, anniversary-based), plus tax returns, beneficial ownership filings, and regulatory submissions.

CompCal tracks every deadline across all three jurisdictions. Add your entities, and never miss a filing.

Get started with CompCal and consolidate your Crown Dependency compliance in one place.