Alexander Kleschev comments on the article on the risks of CEIF use for tax optimization

On June 17, 2025, Pravo.ru published the article «Wise structuring: which instruments are used in business to “pack” assets».

Alexander Kleschev, Partner in ALRUD Corporate and M&A practice, noted that after 2022 close-end investment funds (CEIF) became one of the most popular instruments for assets ring-fencing and tax burden minimization. Alexander warns, however:

The use of CEIF just for the sake of tax optimization is risky and should not become the main objective of structuring.

These are the keynotes of Alexander's comment:

• Attempts to use CEIF for tax saving only can have negative effects including concerns on the part of tax authorities;

• CEIF should be considered as an instrument for complex protection and confidentiality of assets, not only as tax reduction means;

• Due to growing interest to CEIF in sign of regulatory changes and tightening of sanctions pressure the applicability of each instrument should be carefully analyzed in particular context.

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