Protected Cell Companies Provide Additional Security

Traditional investment fund structures such as umbrella or multi-class funds, whether established as companies or unit trusts, have always suffered from the risk of "contagion" between the different share classes or sub-funds. The risk is that losses attributable to one class or sub-fund may reduce or even extinguish the assets attributable to another. Gibraltar's Protected Cell Companies Act 2001 provides a unique solution to this problem.

Gibraltar is one of the several domiciles that provides for protected cell companies (PCC). It is interesting that while the PCC was initially developed for the captive insurance industry it has now also become a popular method of structuring hedge funds, property funds and private equity funds.