CSSF clarifies the application of MiFID to Luxembourg Fund Managers

On 10 June 2021, the CSSF published an FAQ on the application of MiFID to Luxembourg management companies (section 10) and alternative investment fund managers (section 26) (IFM). This FAQ clarified under what circumstances and to what extent MiFID applies to IFMs, their third-party delegates and their investment advisers.

IFMs are expected to comply with the CSSF FAQ as soon as possible and by 31 December 2021 at the latest, considering the best interests of investors.

From a practical perspective, IFMs should as soon as possible analyse their organisation model in order to assess:

• the need for an authorisation to provide services under (i) Article 101(3) of the Law of 17 December 2010 relating to undertakings for collective investment or (ii) under Article 5(4) of the Law of 12 July 2013 on alternative investment fund managers (ie discretionary portfolio management and non-core services (including investment advice)); and
• appropriate compliance, by any third country entity acting as their delegate or undertaking services on their behalf with the third country regime as foreseen under CSSF Circular 19/716 on the provision in Luxembourg of investment services or performance of investment activities and ancillary services in accordance with Article 32-1 of the Law of 5 April 1993 on the financial sector, as amended. Please refer to our newsflash on this topic.