Investment Funds in Luxembourg - 2023 edition

Overview of the principal regulations applicable to Luxembourg investment funds (undertakings for collective investment — UCIs), details relating to structures of UCIs, minimum capital requirements, specific requirements and vehicles used in conjunction with Alternative Investment Funds (AIFs).

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Procedures to be followed when setting up or amending an undertaking for collective investment (UCI) in Luxembourg, ongoing supervisory requirements, including the requirements and considerations for conversions and mergers of UCIs, the fast track authorization procedure for the creation of a side pocket, transfer of foreign UCIs to Luxembourg and liquidation of UCIs and compartments, as well as dormant compartments.

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Summary of investment and borrowing rules applicable to Luxembourg investment funds, including fund investment objectives and policies, asset eligibility, and compliance with investment restrictions.

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Overview of governance models, roles and responsibilities for Luxembourg investment funds and managers, as well as requirements for delegate and service provider due diligence.

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Outline of the scope of activities and functions of management entities, as well as the applicable regulations and legal, operational, financial and tax requirements for setting up and operating management entities in Luxembourg.

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Details on the risk management and valuation requirements applicable to Luxembourg investment funds, management companies and AIFMs.

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Summary of the requirements applicable to the administration function in Luxembourg, including but not limited to: roles and responsibilities, authorization, regulatory and organizational requirements, net asset value treatment, compliance monitoring, subscriptions and redemptions, as well as anti-money laundering and counter terrorist financing procedures. 

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Key points related to the depositary function of Luxembourg investment funds, covering qualifications and duties of the depositary, conduct of business rules, liability and delegation by the depositaries to third parties.

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Requirements related to fund documentation and reporting, including prospectuses, KID and other investor information, financial reports and other periodic regulatory reporting to the CSSF and foreign supervisory authorities. Disclosures regarding sustainability are covered in Chapter 14.

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Overview of the formation and expenses incurred by and taxation of Luxembourg undertakings for collective investments (UCIs), including the VAT regime applicable to services provided to Luxembourg UCIs and their service providers. 

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Requirements applicable to the marketing of Luxembourg investment funds, encompassing distribution regulation (including pre-marketing), fund registration, distribution strategy, as well as distributor due diligence and compliance. 

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Summary of the key conditions for listing securities on the regulated market in Luxembourg – the Luxembourg Stock Exchange (LuxSE) – as well as the multilateral trading facility operated by the LuxSE, and the Luxembourg Stock Exchange Official List (LuxSE SOL). 

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Breakdown of the minimum requirements applicable to investment fund managers and undertakings for collective investments (UCIs) as regards environment, social and governance (ESG) factors and risks.

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Overview of the EY Luxembourg asset management practice and list of investment fund services, including audit, financial accounting, tax, transactions and advisory services, covering the complete lifecycle of an investment fund from concept, through launch, to business as usual, and beyond.

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