Chicago-headquartered investment and asset manager Northern Trust has set up a Common Contractual Fund, a platform that will allow investment managers to offer proprietary investment strategies in a cross-border fund vehicle designed to appeal to large institutional investors.

The Northern Trust CCF is an Irish-domiciled vehicle established under the EU’s Undertaking for Collective Investment in Transferable Securities directive - UCITS.

Within the Northern Trust CCF, investment managers can establish sub-funds with distinct portfolios of assets, investment guidelines, fund features, and investors. Northern Trust will provide global custody, fund administration, investor-level tax services and management company services to the CCF and the underlying sub-funds.

As a vehicle that is recognized as tax-transparent in many investment markets and investor jurisdictions, the Northern Trust CCF may allow certain institutional investors to invest on a tax efficient basis, benefiting from treaty arrangements in place between their home jurisdiction and the country of investment, thereby reducing certain taxes on the sub-fund’s investments when compared to non fiscally-transparent fund structures.

Serge Boccassini, senior vice president, global asset servicing product and strategy at Northern Trust, said: “This platform will help investment managers gain access to the European market through a UCITS fund that also protects the tax status of the underlying institutional investors.” 

At 31 December 2009, Northern Trust administered a total of $158 billion in cross-border fund assets from offices in Guernsey, Ireland and Luxembourg.