Key takeaways:

• Tomorrow Scotland votes in a referendum on independence. The outcome of the vote is far from certain, but whichever way the vote goes, there will be significant long term economic, political, tax and legal impacts, including on private equity firms and other alternative asset managers doing business in Scotland or with funds (or fund GPs) organized under Scottish law.
• If Scotland votes “yes” for independence on Thursday, independence will begin no earlier than 2016. At that time, certain taxes could be increased (or not), thereby impacting the tax burden on Scottish entities or firms doing business there. Beyond taxes, if the vote is “yes”, then as a general matter an independent Scotland presumably would need to enact its own laws to replace all the UK laws that currently apply in Scotland; negotiate a number of treaties with other countries; and set up its own regulatory infrastructure. It seems unlikely that Scotland, as an independent country, would be able to remain a member of the EU without any further action on its part. If that is correct (and there is some uncertainty on the point), if Scotland wished to remain in the EU, it would have to apply for membership of the EU. If an independent Scotland was not part of the EU, this would have an impact on the current application of EU Directives to entities in Scotland, including AIFMD.
• Even if Scotland votes “no” in the referendum and remains part of the United Kingdom, Scotland will nevertheless receive additional taxing powers by 2016. For example, the Scottish parliament will have the power to set a new Scottish income tax on top of the UK government income tax. Furthermore, it is proposed that more powers (in addition to taxing powers) will be devolved to the Scottish parliament. It is difficult to know at this early stage what additional powers might devolve and how they might be used.