On June 03, 2025, VERBA LEGAL held a business breakfast on the topic of “Closed-End Investment and Personal Funds in the Era of Private Capital Transformation" where the panelists (lawyers, representatives of management companies and the specialized depositary) had an opportunity to discuss legal and practical matters associated with using closed-end investment funds (CEIFs) and personal funds.

Alexander Rudyakov, VERBA LEGAL’s Senior Partner and Head of its M&A Practice, offered insight into the main trends in the evolution of CEIFs and personal funds, emphasizing their importance in present-day conditions.

Managing Partner Tatyana Neveeva elaborated on how asset holding structures could be shaped up using CEIFs/personal funds in the light of sanctions restrictions

Counsel Ekaterina Sitnikova talked about the role the specialized depositary should play in ensuring the legal sustainability and transparency of the operations of a CEIF.

Alexander Koloskov, Senior Associate, concluded the debates by speaking on the practical aspects of structuring joint investments and the approaches to raising capital based on investment funds.

Trends in the spotlight:

In 2025, there has been an explosive growth in the number of personal funds, with more than 110 new funds registered in the first half of the year alone, bringing the total number to 260 as of 31 May 2025, which goes to show that this instrument is in great demand among major fund holders.

The CEIF market has also been gaining momentum: the net asset value of CEIFs has more than doubled since 2022, reaching circa RUB 19.9 trillion by the end of the first quarter of 2025, which accounts for 80 per cent of all mutual fund assets in Russia.

A personal fund can act as a CEIF’s stakeholder, making it possible to exploit the advantages of both structures. This combination ensures the anonymity of ownership, continuity of management, tax optimization and asset protection while leveling out certain regulatory gaps.

Changes to legislation introduced in 2024-2025 simplified the procedure for registration of personal funds, enhanced the protection of information on founders and made it possible to set up CEIFS under the personal fund umbrella.

Thanks to all the participants for a lively discussion!