Since this Belgian specialised real estate investment funds (“FIIS”) (“Fonds d’Investissement
Immobiliers Specialisés” (“FIIS”) – “Gespecialiseerd Vastgoedbeleggingsfonds” (“GVBF”) only needs
to register with the Ministry of Finance, it is possible to establish an FIIS and make it
operational in a very limited period of time with only limited costs.
1. FIIS - what is it?
The FIIS is an institutional collective investment fund for collective investments
(institutional AIF), with a fixed number of participation rights (“closed-end”), a distribution
obligation of 80% of its result, and with a collective investment in real estate as its sole goal.
It is a non-listed “passive” fund, which, in this respect, represents the opposite of the active,
commercially operational BE-REIT (“Société Immobiliéres Réglementées” (“SIR”) / “Gereglementeerde
Vastgoedvennootschap” (“GVV”)). More information about the BE-REIT can be consulted by clicking
The FIIS aims at providing asset managers and institutional investors with a flexible and
efficient fund vehicle for their real estate investments in a collective manner.
2. Main characteristics of the FIIS
From a regulatory point of view, its main characteristics are as follows:
- Light regulatory regime with no approval or direct supervision of the FSMA, if certain
criteria are met. Only the registration on a list held by the Belgian Ministry of Finance is
- The FIIS can be incorporated by one single eligible investor and be exempted from the AIFM
Law (the law of 19 April 2014 relating to the alternative investment funds and their managers),
if certain criteria are met.
- The FIIS participation rights are solely available to “qualified investors” in accordance
with the AIFM Law (e.g. credit institutions, insurance companies, pension funds, etc.).
- The FIIS is subject to a minimum investment volume of at least EUR 10,000,000 at the end of
the second financial year following its registration on the FIIS list (held by the Belgian
Ministry of Finance).
- The FISS is a closed-end fund (there is no right to exit through a repurchase as is possible
in an investment company with variable share capital) with a fixed capital, and it is prohibited
of being listed on a stock exchange.
- The FISS invests in real estate, broadly defined, but without compulsory diversification
requirements or (use of) leverage limits (the assets of an FIIS may therefore, in principle,
consist of a single property, with a freely determinable loan-to-value).
- The FIIS accounts are mandatory under IFRS (exclusion of Belgian GAAP).
- The FIIS is subject to a yearly distribution obligation of 80% of its results (i.e. net
current income and the realised gains on real estate).
- The duration of an FIIS is limited to 10 years with the possibility to extend this period by
consecutive periods of maximum 5 years each.
The FIIS enjoys the same favourable tax regime as a BE-REIT, which is fiscally transparent, and
which main characteristics are as follows:
- The FIIS is formally subject to corporate tax income, but on a reduced taxable base (i.e.
investment income (rental income, capital gains, dividends and interest) is not subject to
corporate income tax). Being formally subject to corporate income tax should grant the FIIS
access to double tax treaties.
- Management services invoiced to the FIIS benefit from a VAT exemption.
- The FIIS is subject to a yearly 0.01% subscription tax (“taxe d’abonnement” /
- In return for this favourable tax regime, the latent gain on the Belgian real estate and the
tax-free reserves are subject to an exit tax at a rate of 16.995%.
- Taxation is mainly located at the level of the shareholders: in principle dividends paid by
an FIIS is subject to a withholding tax of 30%, subject to exemption or reduction by virtue of
the applicable tax treaty; dividends paid by an FIIS to a Belgian company are taxable at the
standard corporate tax rate (33.99% including supplementary crisis contribution, and, in
principle, no dividend received deduction is possible, except when and only to the extent that
the dividends received from an FIIS stem from already taxed income such as taxed income from
foreign real estate or dividends received from normally taxed subsidiaries.
- A specific exemption from withholding tax for non-resident savers is provided for.
For more insights on this topic, do not hesitate to contact us.
Would you like to learn more about this subject?
Contact our experts or telephone +32 (0)2 747 40 07