The RAIF and the SCSp are not two competing legal forms. An SCSp is a partnership form under company law. A RAIF is a fund regime, and many RAIFs use the SCSp form.
The useful comparison is therefore between two versions of the same partnership. A plain SCSp relies on the Law of 10 August 1915 and the AIFM rules that apply to its activity. A RAIF-SCSp adds the Law of 23 July 2016.
What both structures share
Both structures can use a limited partnership agreement to define commitments, distributions, governance, transfers and the roles of the general and limited partners. Neither has legal personality in SCSp form.
Neither structure needs direct CSSF product approval before launch. This does not mean that the wider regulatory framework disappears. If the partnership raises capital from several investors under a defined investment policy, it is normally an alternative investment fund and falls within the AIFM framework.
The main differences come from the product rules layered onto the RAIF.
The comparison
| Point | RAIF in SCSp form | Plain SCSp that is an AIF |
|---|---|---|
| Product law | RAIF Law and company law | Company law only |
| CSSF product approval | None | None |
| AIFM | External authorised AIFM required | Registered AIFM may be available below the thresholds |
| Investors | Well-informed investors only | No RAIF statutory test, subject to marketing and other applicable rules |
| Minimum fund assets | EUR 1.25 million within 24 months | No statutory fund minimum |
| Depositary | Required | Required under the full authorised-AIFM regime, but not by the plain SCSp form itself |
| Annual audit | Required by the RAIF Law | No RAIF audit rule; another law or the partnership agreement may require one |
| Subscription tax | 0.01% under the standard regime, subject to exemptions | None |
| Statutory compartments | Available | Not available under the SCSp form alone |
The table does not make one route generally better. It shows which operating obligations follow from the wrapper.
The AIFM decision
A RAIF must appoint an external AIFM authorised under the full AIFM Law. It cannot use the lighter registration route.
A plain SCSp that is an AIF has more room. Its manager may use the sub-threshold registration regime while aggregate assets remain within Article 3. The thresholds are EUR 100 million when leverage is included, or EUR 500 million when every AIF concerned is unleveraged and offers no redemption rights for 5 years after initial investment.
A plain SCSp can still appoint an authorised AIFM. This is important because the AIFMD marketing passport to professional investors follows the authorised manager, not the RAIF label. A plain SCSp with an authorised AIFM can use the passport if the legal conditions and notification process are met. A registered manager cannot.
Investor access
The RAIF is reserved to well-informed investors. Institutional and professional investors qualify. Another investor must accept that status in writing and either invest at least EUR 100,000 or obtain the professional assessment required by law. The 2023 reform reduced the monetary threshold from EUR 125,000.
A plain SCSp has no equivalent investor test in company law. That does not open unrestricted retail distribution. AIFMD marketing rules, national placement rules, securities law and the partnership agreement still determine who can invest.
Depositary, audit and minimum assets
The RAIF product regime requires a Luxembourg depositary and an approved statutory auditor. In SCSp form, its net assets must reach EUR 1.25 million within 24 months of constitution.
A plain SCSp does not acquire these duties simply because of its legal form. A depositary becomes mandatory when the full AIFMD regime applies through an authorised AIFM, subject to the law’s scope. An audit may follow from another applicable rule or the partnership agreement.
This difference affects governance as much as administration. The RAIF places valuation, safekeeping, cash monitoring and annual audit inside a statutory product framework. A plain SCSp can add contractual controls, but they do not become RAIF rules by imitation.
Tax framework
A standard RAIF is exempt from Luxembourg corporate income tax, municipal business tax and net wealth tax under the RAIF Law. It pays annual subscription tax of 0.01% of net assets, calculated quarterly, with statutory exemptions. An Article 48 risk-capital RAIF follows a different direct-tax regime and is not subject to subscription tax.
A plain SCSp has no subscription tax and is ordinarily transparent for corporate income tax, subject notably to the Article 168quater reverse-hybrid rule. Municipal business tax remains a separate question. ACD Circular L.I.R. 14/4 addresses both the actual activity and the commercial imprint that can arise when a capital-company GP holds at least 5%.
The RAIF tax regime is therefore more standardised. The plain SCSp result depends more directly on the partnership’s facts and investor analysis.
Compartments and later conversion
The RAIF Law permits statutory compartments with segregated assets and liabilities when the constitutive documents provide for them. A plain SCSp cannot create the same statutory umbrella merely by using internal accounts. Separate partnerships are normally needed for legal segregation.
A plain SCSp can later enter the RAIF regime, but the change is not automatic. The limited partnership agreement must submit the vehicle to the RAIF Law. An authorised AIFM and depositary must be in place, the required disclosures and audit framework must be adopted, and the notarial and RCS formalities must be completed.
The possibility of a later change should not replace an initial distribution and operating analysis. Contracts, investor consents and service-provider onboarding can make a later transition more involved than forming the intended wrapper at the outset.
Conclusion
A plain SCSp offers the narrower statutory framework and can use a registered AIFM below the thresholds. A RAIF adds a well-informed-investor perimeter, authorised AIFM, depositary, audit, minimum assets and statutory compartments. The correct choice follows from the target investors, marketing plan and operating model, not from the partnership form alone.
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Frequently Asked Questions
Is a RAIF a legal form separate from the SCSp?
No. The SCSp is a legal form, while the RAIF is a fund regime that can use the SCSp form. The practical comparison is therefore between a plain SCSp and an SCSp operating under the RAIF regime.
Does a plain SCSp need an authorised AIFM?
Not always. If the SCSp is an AIF, it needs an AIFM. A registered manager may be available below the statutory registration thresholds. A plain SCSp can also appoint an authorised AIFM, while a RAIF must appoint an external authorised AIFM from the outset.
Can a plain SCSp use the AIFMD marketing passport?
Yes, for marketing to professional investors if it is managed by an authorised AIFM and the passport conditions are met. The passport comes from the manager's authorisation, not the RAIF label. A plain SCSp with only a registered manager cannot use it.
How do the fund-level tax rules differ?
A standard RAIF is subject to annual subscription tax of 0.01% of net assets, with statutory exemptions. A plain SCSp has no subscription tax and is ordinarily transparent for corporate income tax, subject notably to the reverse-hybrid rule. Its activity and the GP interest still require a municipal business tax analysis.
Can a plain SCSp later become a RAIF?
It can enter the RAIF regime if all legal conditions are met. This requires more than a name change. The partnership agreement, AIFM, depositary, offering terms, notarial recording and RCS steps must all be aligned with the new regime.
