Management companies

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Management companies

Taking up your business challenges together

At a time when many asset managers are expressing concern about pressure on margins and complex regulatory developments, management companies must find new ways of adapting to a changing environment for both UCITS and non-UCITS structures.

Since the advent of UCITS III, substance requirements have gradually and steadily increased. Market players have adopted various models in response to this evolution, though a common challenge underpins their choices: the increased minimum efficient operational scale for running a UCITS fund, whether via a management company or on a self-managed basis. The introduction of AIFMD not only confirms this trend but extends its application to non-UCITS products.

The CSSF circular 12/546 dated 24 October 2012 sets out the conditions and organisational requirements applicable to UCITS management companies and self-managed SICAVs.

Key substance requirements can be summarised as follows:

  • Proportionality: derogations to substance requirements remain possible; however, the conditions under which they can be obtained have been reiterated by the CSSF
  • Shareholders: a ‘sponsorship letter’ can be requested by the CSSF, hence reintroducing ‘Promotership’ on a selective basis, with ad hoc guarantee requirements
  • Board composition: in addition to professional experience, directors must observe a more detailed and stringent incompatibility regime
  • Conducting officers: the new circular provides detailed qualification requirements (experience, location, availability, occupation), including scope and duties. Conducting officers must observe a more detailed and stringent incompatibility regime
  • Central administration and internal governance: both expertise and decision-making centres should be in Luxembourg and supported by adequate human and technical infrastructure
  • Delegation: delegation and sub-delegation both require prior CSSF approval and due diligence by the management company

We develop targeted services to help you elaborating a sustainable business model, and our multi-disciplinary offering enables us to address your key industry challenges. 

Contacts

Vincent Gouverneur

Vincent Gouverneur

Partner | EMEA Investment Management Leader

Vincent is a partner within the advisory and consulting department and also leads the clients and markets initiative as well as all services relating to the investment management industry in the Europ... More

Benjamin Collette

Benjamin Collette

Partner | Strategy, Clients & Industries Leader

Benjamin currently serves as Deloitte Luxembourg’s Strategy, Clients & Industries Leader and he is the firm’s Financial Services Industry Leader. In addition to his firm-wide roles, Benjamin leads the... More

Lou Kiesch

Lou Kiesch

Partner | Regulatory Consulting Leader

Lou joined Deloitte in November 2001 as Director in the Risk Advisory department, where he currently heads up the Compliance and Regulatory Practice. Since June 2005, he is partner within Deloitte’s R... More