An updated independent study confirms that the current solvency capital requirement (SCR) of 25% for European real estate investment under the Solvency II Directive, including through funds, does not reflect the true volatility of real estate investment in Europe. As a result, the amount of capital that must be set aside to cover potential losses from real estate investment is higher than is necessary for sound prudential management.
On 1 February, INREV filed a response to the OECD’s Discussion Paper on BEPS Action 6 related to tax treaty abuse and non-CIVs. Although the paper’s example on real estate was highly favourable for non-listed funds and reflected earlier INREV comments, the response prepared by the Tax Committee proposed some minor improvements that would improve clarity.
On 6 January, the OECD issued a discussion draft on Non-CIVs that includes a realistic example of a Real Estate non-CIV (example 3). Based on the facts and circumstances of the example, the OECD concluded that it would be unreasonable to deny treaty benefits to the holding company serving as the corporate investment platform of the non-CIV. In their example, the working party uses similar considerations to justify the use of the holding company as INREV did in its response to the non-CIV report.
On 12 January INREV filed its response to the evaluation of procedural and jurisdictional aspects of EU Merger control. We urged the Commission to adopt measures to clarify that real estate co-investors that might otherwise exceed the Merger Regulation thresholds do not need to submit co-investments for review and approval.
Forum Call Recording October 2016 - Brexit update from a UK and remaining EU country perspective
2 November 2016
This month’s Public Affairs Forum call focused on the current state of play of Brexit and the potential impact it will have on non-listed real estate investment. Simon Crown and Marian Scheele, partners at Clifford Chance in London and Amsterdam, presented the topic from both the UK and the remaining EU Member State perspective.