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Regulatory News Alert
You can find here the latest national, European or international regulatory updates analysed by Deloitte.
In July 2021, the UK Prudential Regulation Authority (PRA) published its supervisory statement SS5/21 that should be of great importance for the European banks and investment firms operating in the United Kingdom via a subsidiary or branch.
On 20 July 2021, the European Commission presented an anti-money laundering and countering the financing of terrorism (AML/CFT) package.
On 15 July 2021, the Central Bank of Luxembourg (BCL) published a new reporting framework for the collection of payment statistics (“CDDP6”). This revised framework concerns all payment servicing institutions and will start with the reference period of January 2022.
On 10 June 2021, the European Banking Authority (EBA) published the final revised Guidelines on major incident reporting under PSD2 (EBA/GL/2021/03).
The Standard Contractual Clauses (SCCs) are sets of standardized contractual terms, conditions and obligations that aim to ensure the transfer of personal data leaving the EU/EEA complies with the EU’s data privacy laws and requirements.
On 21 June 2021, the Commission de Surveillance du Secteur Financier (CSSF) published Circular CSSF 21/773, a new guidance on the management of climate-related and environmental risks.
On 21 May 2021, the Chambre des Députés of Luxembourg published Bill no. 7825 (the Bill) amending the Law of 22 March 2004 on securitization (the Law).
On 10 June 2021, the Commission de Surveillance du Secteur Financier (CSSF) published an FAQ on the application of the Markets in Financial Instruments Directive (MiFID) to investment fund managers (IFMs).
On 27 May 2021, the European Securities and Markets Authority (ESMA) published its final report on the Guidelines under the Regulation (EU) 2019/1156 on cross-border distribution of funds (CBR), which specify the requirements that funds’ marketing communications must meet.
On 3 February 2021, the European Supervisory Authorities (ESAs) published the outcome of their discussions on the packaged retail investment and insurance products (PRIIPs) regulation and announced they reached a consensus on the PRIIPs amendments.
On 21 April 2021, the European Commission (EC) proposed the first-ever Regulation (“AI Regulation”) laying down harmonized rules on artificial intelligence (AI) and amending certain EU legislative acts.
On 15 April 2021, the European Securities and Markets Authority (ESMA) published its final report on the European Markets Infrastructure Regulation (EMIR) and Securities Financing Transactions Regulation (SFTR) data quality.
On 9 April 2021, the Commission de Surveillance du Secteur Financier (CSSF) published Circular 21/769 regarding governance and security requirements for supervised entities to perform tasks or activities through telework (the “Circular”).
The reporting requirements of Regulation No 600/2014 on markets in financial instruments (MiFIR) aimed to provide national competent authorities (NCAs) with a complete picture of the market to support their oversight activities by introducing a uniform and standardized EU-wide reporting regime.
On 17 March 2021, the three European Supervisory Authorities (ESAs) published a joint consultation paper on draft regulatory technical standards (RTS) regarding the content and presentation of sustainability disclosures under Articles 8(4), 9(6) and 11(5) of the Sustainable Finance Disclosure Regulation (SFDR).
On 5 March 2021, the Commission de Surveillance du Secteur Financier (CSSF) published a communication regarding the launch of the European Securities and Markets Authority’s (ESMA) Common Supervisory Action (CSA) on the supervision of costs and fees of UCITS.
On 25 February 2021, the European Supervisory Authorities (ESAs) published a joint statement on the application of the Sustainable Finance Disclosure Regulation (SFDR).
On 17 February 2021, the Administration de l’enregistrement, des domaines et de la TVA (the Administration) published Circular No. 804bis clarifying the new subscription tax rates for undertakings for collective investment (UCIs) or individual compartments of a UCI with multiple compartments.
On 18 February 2021, the Commission de Surveillance du Secteur Financier (CSSF) published a revised notification form in accordance with Circular CSSF 02/77. This form is accompanied by an explanatory document that provides further clarification regarding the form and notification process.
On 1 February 2021, the European Securities and Markets Authority (ESMA) published its final report and draft of the implementing technical standards (ITS) under Regulation EU/2019/1156 on the facilitation of cross-border distribution of collective investment undertakings.
On Friday 12 February 2021, FinDatEx validated version 3.1 of the new European Markets in Financial Instruments Directive (MiFID) template (EMT). Changes from EMT v3 include information related to Sustainable Finance Disclosure Regulation (SFDR) level 1 requirements for investment funds.
On 2 February 2021, the three European Supervisory Authorities (“ESAs”) published the final report on the Regulatory Technical Standards (“RTS”), which supplement Regulation (EU) 2019/2088 (also referred to as the “Sustainable Finance Disclosure Regulation” or “SFDR”).
On 20 July 2020, the European Supervisory Authorities (ESAs) published the outcome of the packaged retail investment and insurance products (PRIIPs) review. Despite the efforts made in the last 18 months, they have up to now failed to agree on the final text.
On 26 January 2021, the Financial Action Task Force (FATF) decided to postpone for a second time its Luxembourg onsite visit due to COVID-19. Originally scheduled for June and July 2020, the inspection had already been postponed to March 2021 due to the travel restrictions and lockdown measures in place.
On 27 January 2021, Commission Delegated Regulation (EU) 2021/70 amending Delegated Regulation (EU) 2018/1229 concerning the regulatory technical standards (RTS) on settlement discipline was published in the Official Journal of the European Union (OJ).
On 22 January 2021, Luxembourg published law of 22 January 2021 on dematerialized securities. This law modifies both the law of 5 April 1993 on the financial sector, as amended and the law of 6 April 2013 on dematerialized securities.
On 18 December 2020, the CSSF published the CSSF Circular 20/764 about the Guidelines on performance fees in UCITS and certain types of AIFs. This Circular applies the final Guidelines of ESMA on performance fees published on 5 November 2020.
On 18 December 2020, the Commission de Surveillance du Secteur Financier (CSSF) published the results of the Thematic Review on Efficient Portfolio Management – Revenues and Costs/Fees (“the Review”) and of the Frequently Asked Question on the use of Securities Financing Transactions by UCITS.
On 11 December 2020, the Commission de Surveillance du Secteur Financier (CSSF) published Circular CSSF 20/762 amending CSSF Circular 08/338 on the implementation of a stress test to assess the interest rate risk arising from nontrading book activities.
On 16 December 2020, the Commission de Surveillance du Secteur Financier (CSSF) published a communication on the regulatory requirements and fast-track procedure regarding Regulation (EU) 2019/2088 on the sustainability-related disclosures in the financial services sector (SFDR).
On 7 December 2020, the Commission de Surveillance du Secteur Financier (CSSF) released the long awaited revision of CSSF Circular 12/552 on central administration, internal governance and risk management.
On 7 December 2020, the Commission de Surveillance du Secteur Financier (CSSF) published press release 20/26 to clarify the actions that impacted funds and/or managers will need to take prior to the end of the Brexit transitional period (31 December 2020).
Crowdfunding is a financial technology solution that provides small and medium-sized enterprises (SMEs) and, in particular, start-ups and scale-ups, with alternative access to finance in order to promote innovative entrepreneurship in the Union, thereby strengthening the Capital Markets Union.
Given the current context, the ESAs have discussed with the European Commission the need to replace already submitted amendments of the Commission Delegated Regulation (EU) No 2016/2251 that set out the detailed bilateral margin requirements (RTS), so that additional deferrals can be included.
On 9 November 2020, the European Securities and Markets Authority (ESMA) launched a consultation on the draft guidelines on marketing communications under the Regulation (EU) 2019/1156 of 20 June 2019 on facilitating cross-border distribution of collective investment undertakings (CBR).
On 23 October 2020, the Commission de Surveillance du Secteur Financier (CSSF) published Circular CSSF 20/753 to provide counterparty credit risk institutions (“institutions”) with updated supervisory expectations on the regulatory requirements that apply to the Internal Capital Adequacy Assessment Process (ICAAP) and the Internal Liquidity Adequacy Assessment Process (ILAAP), as well as to stress testing programs under the European Banking Authority’s guidelines (EBA/GL/2018/04).
On 22 October 2020, the European Commission (EC) launched a consultation on the review of Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers (AIFMD).
On 24 September 2020, the European Commission published a new Capital Markets Union (CMU) Action Plan. This Action Plan reflects the European Union’s (EU) priority to ensure that Europe recovers from the economic crisis caused by the COVID-19 pandemic, aiming to create a truly single market for capital across the EU. A fully functioning and integrated market for capital will allow the EU’s economy to grow sustainably and be more competitive.
On 24 September 2020, the European Commission (EC) set out a new Digital Finance Package to support the innovation and competition of digital finance.
On 23 September 2020, the Luxembourg government published a press release on extending the measures that allow companies and legal persons to hold their general meetings and other essential meetings remotely, as the COVID-19 pandemic continues to affect the good governance of companies and other legal persons.
On 21 September 2020, the Commission Implementing Decision (EU) 2020/1308 was published in the Official Journal of the European Union. This decision determines, for a limited period, that the regulatory framework applicable to central counterparties (CCPs) in the United Kingdom of Great Britain (UK) and Northern Ireland is equivalent to the requirements set out in Regulation (EU) No 648/2012 (EMIR).
On 14 September 2020, the Financial Action Task Force (FATF) published a report entitled “Virtual Assets - Red Flag Indicators of Money Laundering and Terrorist Financing”.
On 20 August 2020, CSSF Regulation n°20-05 of 14 August 2020 amending CSSF Regulation n°12-02 of 14 December 2012 relating to the fight against money laundering and the financing of terrorism was published in the Official Journal.
On 25 August 2020, the Commission de Surveillance du Secteur Financier (CSSF) published Circular 20/750 on requirements regarding information and communication technology (ICT) and security risk management (“the circular”), implementing in Luxembourg the EBA Guidelines on ICT and security risk management (EBA/GL/2019/04, “the guidelines”).
On 27 July 2020, the Luxembourg government submitted draft law n°7637 to the Luxembourg parliament. This draft law aims to modify the law of 5 April 1993 on the financial sector, as amended, and the law of 6 April 2013 on dematerialized securities.
In February 2020, the European Securities and Markets Authority (ESMA) proposed to postpone the entry into force of the regulatory technical standards (RTS) on settlement discipline in accordance with the Central Securities Depositories Regulation (CSDR) until 1 February 2021.
On 23 July 2020, the Commission de Surveillance du Secteur Financier (CSSF) published Circular 20/747 on the technical procedures regarding the application of the Law of 25 March 2020 establishing a central electronic data retrieval system related to international bank account numbers (IBAN) and safe-deposit boxes.
On 24 July 2020, the European Commission adopted a Capital Markets Recovery Package (“the Package”) to help capital markets support businesses to recover from the COVID-19 pandemic.
Following Luxembourg’s Law of 28 May 2019 transposing the NIS Directive1, on 20 July 2020, the Commission de Surveillance du Secteur Financier (CSSF) published its Regulation N° 20-04 of 15 July 2020 on the list of services considered as essential for maintaining critical societal and economic activities.
Decision 2016/1250 on the adequacy of the protection provided by the EU-US Privacy Shield. On 16 July 2020, the Court of Justice of the European Union (CJEU) declared that the European Commission's adequacy decision regarding the European Union (EU)-United States (US) Privacy Shield is invalid.
On 9 July 2020, the European Securities and Markets Authority (ESMA) published a public statement on the prohibition of providing external support to money market funds (MMFs) under Article 35 of the Regulation (EU) 2017/1131 (MMF Regulation).
On 1 July 2020, the Luxembourg parliament unanimously approved the law on the creation of a register of fiducies and trusts.
After reaching a political agreement in December 2019, the EU’s Regulation 2020/852 on the establishment of a framework to facilitate sustainable investment (“Taxonomy Regulation”) was published in the Official Journal on 22 June 2020.
On 10 June 2020, the European Commission published its report assessing the application and the scope of Directive 2011/61/EU of the European Parliament and of the Council on alternative investment fund managers (AIFMD).
On 10 June 2020, the High-Level Forum (HLF) issued its final report on the Capital Markets Union (CMU), the policy initiative launched by the European Commission to achieve fully functioning and integrated capital markets across EU member states.
The Shareholder Rights Directive’s Implementing Regulation 2018/1212 entry into force, is still scheduled for 3 September 2020, is approaching. No COVID-19 related postponement have been planned, hence possible impacts must be considered, both by issuers and by intermediaries.
On 4 June 2020, Luxembourg's Ministry of Finance confirmed that the proposal for a European Commission directive aimed at postponing certain deadlines for declaration and exchange of information in tax matters due to the COVID-19 pandemic has passed the final stages of approval, although this is yet to be formally published.
On 3 June 2020, the European Securities and Markets Authority (ESMA) published a consultation paper on guidelines on outsourcing to cloud service providers (the “Guidelines”) as cloud solutions are commonly used by financial firms.
Following a recent compromise, Member States may exercise the option to defer the DAC6 reporting deadlines by six months.
On 20 May 2020, the European Central Bank (ECB) published for consultation purposes a draft guide outlining its expectations for banks to integrate climate and environmental risks into their operational strategies, governance, risk management and communications.
On 7 May 2020, the European Commission adopted an action plan, which puts forward concrete measures that the Commission will take over the next 12 months to better enforce, supervise and coordinate the EU's rules on combating money laundering and terrorism financing.
On 4 April 2020, in response to the COVID-19 outbreak, the European Supervisory Authorities (ESAs) updated the Final Report on the Regulatory Technical Standards (RTS) on various amendments to the bilateral margin requirements (Commission Delegated Regulation (EU) No 2016/2251).
On 22 April 2020, the European Supervisory Authorities (ESAs) published a joint consultation paper setting out the proposed Regulatory Technical Standards (RTS) on content, methodologies and presentation of disclosures, pursuant to Regulation (EU) 2019/2088 on Sustainable Finance Disclosure (SFDR).
In February 2020, the European Union Council has approved new measures (Directive and Regulation) imposing on payment services providers (PSPs) to collect and report data regarding cross-border payments as from 2024. CESOP, a new database to be set up by the EU Commission, will keep record of this information regarding cross-border payments within the EU, as well as payments to third countries or territories. National tax authorities will have access to CESOP to control the correct fulfilment of VAT obligations, mainly but not exclusively, on cross-border business to consumer (B2C) supplies of goods and services.
On 3 April 2020, the European Securities and Markets Authority (ESMA) published its final performance fees guidelines for UCITS and certain types of AIFs.
On 25 March 2020, the Luxembourg government published a new law introducing a central electronic research system which gathers data about payment and bank accounts identified by an IBAN number and bank safes held by credit institutions in Luxembourg.
On 31 March 2020, the European Securities and Markets Regulator (ESMA) launched a consultation on the standard forms, templates, and procedures that national competent authorities (NCAs) should use to publish information on their websites to facilitate cross-border distribution of funds under Regulation EU/2019/1156 on the facilitation of cross-border distribution of collective investment undertakings.
2 April - Luxembourg draft law: Temporary COVID-19-related measure creates deadline extensions for the approval, filing, and publishing of annual accounts, consolidated accounts, and related documents
Following the recent publication of the Grand Ducal Regulation that authorizes the remote holding of AGMs and other management meetings (alert to be found here), the Luxembourg authorities released draft bill n°7541 on Friday 27 March 2020 to grant the possibility to prorogue or postpone the deposit and publication of annual accounts in derogation to the applicable rules.
On 20 March 2020, in light of the adverse systemic economic impact of the COVID-19 pandemic, the European Central Bank (ECB) announced further measures to provide banks with flexibility in their application of regulatory requirements in the context of the crisis.
On Friday 20 March 2020, a Grand Ducal Regulation dealing with the introduction of special rules and measures governing the organization of shareholder, Board of Directors, or other supervisory and management body meetings was issued, published in the Official Journal of the Grand Duchy of Luxembourg.
Securities Finance Transactions Regulation (SFTR) reporting is planned to ‘go live’ on the 13th or 14th April 2020.
On 11 March 2020, Her Majesty's Treasury Department of the Government of the UK launched a consultation on the proposal for a more streamlined regime to simplify the process for allowing investment funds set up overseas to be marketed in the UK.
The ECB, EBA, and ESMA have taken exceptional measures in response to today’s exceptional circumstances.
On 9 March 2020, the Commission de Surveillance du Secteur Financier (CSSF) updated the Frequently Asked Questions (FAQ) concerning the Luxembourg Law of 17 December 2010 relating to undertakings for collective investment (UCITS).
On 9 March 2020, the Technical Expert Group on sustainable finance (TEG) issued a final report setting out the TEG’s final recommendations to the overarching design of the EU Taxonomy as well as guidance for its users.
On 4 March 2020, the European Commission presented a proposal of legislation in line with the EU's political commitment to be climate neutral by 2050 in order to protect the planet and the people.
The CSSF published Regulation 18/03: « Règlement CSSF N° 18-03 sur 1) l’implémentation de certaines discrétions contenues dans le règlement (UE) n° 575/2013 et la transposition de l’Orientation (UE) 2017/697 de la Banque Centrale Européenne du 4 avril 2017 relative à l'exercice des options et facultés prévues par le droit de l'Union par les autorités compétentes nationales à l'égard des établissements moins importants (BCE/2017/9) et 2) abrogeant le Règlement CSSF N° 14-01 ».
On 19 February 2020, the EU Commission published its new EU digital strategy. It represents the first series of proposals to boost Europe’s digital transformation.
According to Article 37 of Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money market funds (Money Market Fund Regulation or MMFR), the manager of a money market fund (MMF) must report certain information to the competent authority of the MMF.
The topic of sustainable finance has gained significant momentum in recent years. Regulators and supervisors are increasingly focused on incentivizing and requiring financial firms to consider sustainability factors in their day-to-day operations and in helping the economy transition to a more environmentally-friendly way of functioning.
On 5 February 2020, the European Securities and Markets Authority (ESMA) launched a common supervisory action (CSA) with national competent authorities (NCAs) on the application of MiFID II suitability rules across the European Union (EU).
On 4 February 2020, the European Securities and Markets Authority (ESMA) published its Final Report with a view to postpone the entry into force of the Commission Delegated Regulation (EU) 2018/1229 with regard to regulatory technical standards on settlement discipline (RTS on settlement discipline).
On 31 January 2020, the European Securities and Markets Authority (ESMA) published a consultation on draft technical standards on the provision of investment services and activities in the Union by third country firms under Directive 2014/65/EU on markets in financial instruments (MiFID II) and Regulation 600/2014 on markets in financial instruments (MiFIR).
On 17 January 2020, the Commission de Surveillance du Secteur Financier (CSSF) published Luxembourg’s first money laundering (ML) / financing of terrorism (FT) risk analysis on the Collective Investment Sector.
As of 1 January 2020, all entities which are subject to the CSSF supervision and which are using benchmarks are restricted to the use of the following types of benchmarks.
On 16 January 2020, Financial Data Exchange Templates (FinDatEx) published a new version of the Solvency II Tripartite Template (“TPT”).
Before Christmas, Boris Johnson and the Conservative party swept the UK elections, winning 364 seats out of 650. With an absolute majority, the Brexit mandate was made clear: the UK will leave the Single Market on 31 January 2020.
On 6 January 2020, ESMA published its final report, Guidelines on reporting under the Securities Financing Transactions Regulation (SFTR), which includes amended SFTR validation rules and a statement on Legal Entity Identifiers (LEI).
On 20 December 2019, the Commission de surveillance du secteur financier (CSSF) published Circular 19/733 (the Circular) with the objective to implement into Luxembourg regulation, the International Organization of Securities Commissions (IOSCO) recommendations and good practices on liquidity risk management for undertakings for collective investment (UCIs).
On 23 December 2019, the Chamber of Deputies published the Draft Law establishing centralised registries and electronic data retrieval systems to identify natural or legal persons holding or controlling payment accounts, bank accounts, and safe-deposit boxes in Luxembourg.
On 20 December 2019, Commission de Surveillance du Secteur Financier (CSSF) published Circular CSSF 19/732 relating to clarifications on the identification and verification of the identity of the ultimate beneficial owner(s) (UBOs).
On 19 December 2019, Finland's presidency of the Council and the European Parliament reached a political agreement on a new framework facilitating the provision of services across the EU for crowdfunding platforms.
On 17 December 2019, the European Parliament announced that negotiators from the European Parliament and Council of the EU had reached an agreement concerning the so-called “taxonomy regulation” which sets out criteria to determine whether an economic activity is environmentally sustainable.
The Law of 13 January 2019 on Register of Beneficial Owners (the Law), establishing an electronic central register of beneficial owners (RBE) for the legal entities registered on the Luxembourg Trade and Companies Register, has entered into force in March 2019. It requires the entities within its scope to register with the RBE (see our previous news alert for further details).
The fifth European Anti-Money Laundering Directive (Directive (EU) 2018/843 or AMLD 5) requires Member States to not unreasonably restrict or prohibit the exchange of information and/or cooperation between competent authorities for anti-money laundering/combating the financing of terrorism (AML/CFT) supervision purposes.
On 12 December 2019, the European Securities and Markets Authority (ESMA) published a peer review report on how national competent authorities (NCAs) handle suspicious transactions and order reports (STOR) under the Market Abuse Regulation (MAR).
On 11 December 2019, the European Parliament presented the European Green Deal, a roadmap for making the European Union's economy sustainable.
On Tuesday 10 December 2019, the European Working Group validated the new EMT (European MiFID template) v3 template. A few important changes have been made to EMT v1, the version currently used by investment funds, which include updates from existing EMT v1 fields as well as additional new fields.
On 9 January 2019, we reported on the endorsement by EU ambassadors of a legislative package introducing a new regulatory framework for investment firms.
The Basel Committee on Banking Supervision (BCBS) and International Organization of Securities Commissions (IOSCO) have agreed international standards for the exchange of bilateral margin along with a calendar to facilitate a consistent implementation across jurisdictions.
In accordance with Capital Requirements Directive (CRD IV), the European Banking Authority (EBA) has been mandated to further harmonize financial institutions' governance arrangements, processes, and mechanisms across the EU.
The European Commission is now preparing the EU’s next bank capital legislative package, the sixth Capital Requirements Directive and third Capital Requirements Regulation (CRD6/CRR3).
On the 25 November, the CSSF released a FAQ concerning the persons involved in AML/CFT for a Luxembourg investment fund or an investment fund manager supervised by the CSSF for AML/CFT purposes.
On 7 November 2019, the Commission de Surveillance du Secteur Financier (CSSF) issued a press release announcing the set-up of two new market entry forms aimed at collecting standardized key information relating to money laundering and terrorist financing risks and the relevant mitigation measures in place from professionals supervised by the CSSF.
With the objective of increasing transparency of securities financing markets, from April 2020, the package of new measures under the Securities Financing Transactions Regulation (SFTR) was published in the Official Journal of the EU.
The growth in digital financial transactions requires a better understanding of how individuals are being identified and verified in the world of digital financial services. Digital identity (ID) technologies are evolving rapidly, giving rise to a variety of digital ID systems.
On 24 October 2019, the European Supervisory Authorities (ESAs) issued a Supervisory Statement targeting bond manufacturers and distributors within the European Union in order to advocate a level playing field of retail investor protection in the EU and promote an harmonized application by national competent authorities (NCAs) of the scope of the Regulation for packaged retail and insurance-based investment products (PRIIPs Regulation), regarding the determination of the type of bonds for which it is necessary to draw up a Key Information Document (KID).
On 23 October 2019, the European Banking Authority (EBA) published an Opinion on disclosure to consumers buying financial services through digital channels under Directive 2002/65/EC concerning the distance marketing of consumer financial services (the Directive).
On 18 October 2019, the Commission de Surveillance du Secteur Financier (CSSF) issued a new communication reminding all SIFs, Part II UCIs and SICARs to complete an online assessment.
On Wednesday 16 October, the European Supervisory Authorities or “ESAs” (ESMA, EBA, EIOPA) published their long-awaited joint consultation paper concerning amendments to the PRIIPs KID.
On 23 September 2019, the Grand-Ducal Decree of 12 September 2019 (the GDD) determining the new Luxembourg Standard Chart of Accounts (the 2020 SCA) was published in the Luxembourg Official Journal.
On 30 September 2019, the Luxembourg Accounting Committee or the Commission des Normes Comptables (the CNC) published a Q&A (Catégorisation des entreprises : interprétation du critère de répétition visé à l'article 36 LRCS) related to the interpretation of the two consecutive years rule of the Law of 19 December 2002 on the commercial and companies register and on the accounting records and annual accounts of undertakings (the Accounting Law).
On 9 October 2019, the Financial Stability Board (FSB) published a report on the governance arrangements for the globally harmonized Unique Product Identifier (UPI).
Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds (the EU Benchmark Regulation or BMR), has been in process since 1 January 2018.
In order to continue to pursue activities in Luxembourg in a “hard” Brexit scenario, UK asset managers were required to notify the Commission de Surveillance du Secteur Financier (CSSF) of their intention to continue to provide services in Luxembourg by 15 September at the latest.
On 4 October 2019, the three European Supervisory Authorities (EBA, EIOPA and ESMA) published their second joint Opinion on the risks of money laundering and terrorist financing affecting the European Union financial sector.
Earlier this year, the European Commission approached the European Securities and Markets Authority (ESMA) requesting technical advice in regards to a report on the application of the Market Abuse Regulation (MAR).
On 25 September 2019, EU ambassadors approved the Council’s position on creating a ‘green finance taxonomy‘. This opens the negotiations with the European Parliament in order to achieve the final version of the text.
Following the publication of ESMA’s Q&A on the UCITS KIID benchmark and past performance obligations (hereafter “Q&A”) in March 2019, EFAMA requested ESMA to provide further clarification specifically on the KIID-related disclosures as regards the use of benchmarks in UCITS.
In April 2018, the European Systemic Risk Board (ESRB) published a set of recommendations to address liquidity and leverage risk in investment funds.
The Grand Ducal Law of 1 August 2019 amends the Law of 24 May 2011 on the exercise of certain shareholder rights. This law transposes, for Luxembourg, the Directive (EU) 2017/828 (hereafter the Shareholders' Rights Directive II or SRD II).
On 8 August 2019, Draft Law 7467 transposing certain provisions of the fifth Anti-Money Laundering Directive (AMLD V) was presented to the Luxembourg Chamber of Deputies.
On Thursday 25 July, following a six-month public consultative process, the United Nations Environment Programme Finance Initiative (the UNEP FI) has released the final versions of the UNEP FI Principles for Responsible Banking (the Principles) and their supporting framework documents.
On Wednesday 24 July, the European Banking Authority (EBA) published an Opinion urging for closer cooperation and exchange of information between prudential supervisors and Financial Intelligence Units (FIUs).
Regulation (EU) 2017/1131 of 14 June 2017 on money market funds (MMFs) (the “MMF Regulation”) requires guidance on selected requirements. Therefore, ESMA (the European Securities and Markets Authority) has now issued two sets of guidelines that will help MMFs interpret the existing regulatory requirements.
On 15 July 2019, the Commission de Surveillance du Secteur Financier (CSSF) issued two press releases (19/33 and 19/34) with regard to mandatory notification in the event of the UK leaving the EU without a withdrawal agreement (“hard Brexit”).
On 16 July 2019, the European Securities and Markets Authority (ESMA) launched a consultation paper (CP) seeking feedback on the draft Guidelines on performance fees in UCITS (Guidelines).
The Luxembourg Parliament adopted draft Law No. 7349 (the Law) on 11 July 2019. A request to dispense with the second vote required by the Constitution has been filed.
On 2 July 2019, the Luxembourg Parliament adopted the final text of the bill of Law n°7328 (the “New Prospectus Law”), implementing Regulation 2017/1129/EU of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market.
On 1 July 2019, the Commission de Surveillance du Secteur Financier (CSSF) issued a communication requiring all SIFs, Part II UCIs and SICARs to complete an online assessment with regard to the impact of Regulation 1286/2014 (PRIIPs) on PRIIPs manufacturers by 31 October 2019 at the latest.
On 25 February 2019, the CSSF published Circular 19/709 (the Circular) concerning the introduction of quarterly internalised settlement reporting requirements pursuant to Article 9(1) of EU Regulation No 909/2014 (CSDR).
On 24 June 2019, the European Securities and Markets Authority (ESMA) launched a consultation to gather evidence on potential short-term pressures stemming from the financial sector and causing corporations to apply a rather short-term, instead of long-term, view.
On 21 June 2019, the Luxembourg Business Registers (LBR) published an explanatory guide prescribing the methodology for the declaration of Beneficial Owners to the RBE (the “Guide”).
In October 2018, the Financial Action Task Force (FATF) adopted changes to its Recommendations to explicitly clarify that they apply to financial activities involving virtual assets (VA) and virtual asset service providers (VASPs).
EU law requires large companies (listed companies, banks, and insurance companies) to disclose certain information on the way they operate and manage social and environmental challenges. Furthermore, companies are required to include non-financial statements in their annual reports from 2018 onwards.
Compiling information from different jurisdictions regarding their existing frameworks for Cyber regulation, on 18 June 2019, the IOSCO has published a final report that provides an international overview of core cybersecurity standards as well as identification of the potential gaps in their application in different countries.
On 7 June 2019, the amended Capital Requirements Directive (CRD V) and Capital Requirements Regulation (CRR II) were published in the Official Journal of the European Union.
On 7 June, the Regulation (EU) 2019/881 of the European Parliament and of the Council of 17 April 2019 on ENISA (European Union Agency for Cybersecurity) and on information and communication technology cybersecurity certification and repealing Regulation (EU) No 526/2013 (Cybersecurity Act), was published in the Official Journal of the EU.
On 4 June, the European Securities and Markets Authority (ESMA) published updated question and answer documents (Q&As) on the application of the Alternative Investment Fund Managers Directive (AIFMD) and the Undertakings for the Collective Investment in Transferable Securities (UCITS) Directive with the focus on the delegation of depository function in accordance with the requirements set out in the Directives.
The amended Regulation (EU) 2019/834 of the European Parliament and of the Council of 20 May 2019, Regulation (EU) No 648/2012 (Refit) was published in the Official Journal today.
In April 2019, the European Parliament endorsed an agreement on the regulation for Sovereign Bond-Backed Securities (SBBSR). The new financial instrument would take the form of low-risk liquid assets backed by a pre-defined pool of Euro-area central government bonds.
The Regulation supplements Directive (EU) 2015/849 (the Anti-Money Laundering Directive – AMLD) with regard to regulatory technical standards (RTS) for the minimum action credit and financial institutions must take to mitigate money laundering (ML) and terrorist financing (TF) risk in third countries where they have established a branch or a majority-owned subsidiary.
According to the EU Action Plan on Financing Sustainable Growth from May 2018, one of the major goals of the EC is to clarify fiduciary duties and to increase transparency on sustainability risks and investment opportunities.
In October 2018, the Joint Committee of the European Supervisory Authorities (“ESAs”) published revised guidelines on complaints handling by entities of the European securities and banking sectors (“Guidelines”).
In November 2016, the European Commission (EC) proposed a banking reform package to introduce further risk-reduction measures and advance the completion of the European post-crisis regulatory reforms.
On April 10, the Commission de Surveillance du Secteur Financier (“CSSF”) published the new Circular 19/716 (“Circular”) on the provision of investment services and ancillary activities in Luxembourg by third-country firms.
On March 29, 2019, the European Securities and Markets Authority (ESMA) released a new version of its Q&A on the application of the Undertakings for the Collective Investment in Transferable Securities Directive (UCITS Directive).
In 2015, the European Union (EU) concluded the Paris Climate Agreement, setting, among others, the objective to make finance flows consistent with a pathway towards low greenhouse gas emission and climate-resilient development.
On 28 March 2019, the Luxembourg Parliament adopted the Bill of Law n°7426 (the “Law”) in respect of transitional measures for UCITS and Specialized Investment Funds (SIFs) in the context of Brexit.
ESMA clarifications on scope, live expected target date end of May 2019
On 27 March 2019, the CSSF published Circular 19/714 (the Circular) which updates Circular 17/654 on IT outsourcing based on a cloud computing infrastructure.
The Commission introduced on 12 September 2018 a proposal on strengthening the Union framework for prudential and anti-money laundering supervision that served as an accelerator for a project that was lingering on the shelves.
The Securities Financing Transactions Regulation (SFTR), among other things, requires all securities financing transactions (REPO, Reverse REPO, Securities lending, etc.) to be reported to a central database called "trade repository".
The European Parliament and Member States reached a provisional agreement on new rules that will guarantee a high level of protection for whistleblowers who report breaches of EU law.
At the very end of February 2019, the EU reached a political agreement on a new generation of low-carbon benchmarks. In addition, on 7 March, the European Parliament and Member States established another preliminary agreement on sustainable investments and sustainability risks. The new regulation introduces the disclosure obligations on how financial companies integrate the environmental, social and governance factors in their investment decisions.
On 25 February, the European Banking Authority (EBA) published its revised guidelines on outsourcing arrangements. It sets out the specific provisions for the outsourcing governance frameworks applicable to financial institutions that are subject to capital requirements, as well as to payment providers.
Based on the Recommendation, the CSSF has since launched a requirement for semi-annual reporting of borrower-related residential real estate (RRE) indicators. The Circular provides detailed information on the indicators to be reported as well as on the template to be submitted.
On 4 February 2019, the draft bill of law transposing Directive (EU) 2017/828 (known as the Second Shareholders' Rights Directive – SRDII) was lodged with the Luxembourg parliament.
On 15 February 2019, the Luxembourg government adopted the Grand-Ducal Regulation prescribing registration modalities, administrative fees and access to the Register of Beneficial Owners (the “Regulation”).
According to an official notice published on 14 February, Luxembourg’s Chamber of Deputies passed the Bill of Law 7363 (“the Law”) providing a legal framework for securities issued over Distributed Ledger Technology (DLT).
The European System of Financial Supervision (ESFS) was introduced in 2010 and became operational on 1 January 2011. It is a multi-layered system of micro- and macro-prudential authorities, which includes the European Systemic Risk Board (ESRB), the three European Supervisory Authorities (ESAs) and the national supervisors.
European Supervisory Authorities followed up a consultation paper released on 8 November 2018 on targeted amendments to the “PRIIPs Delegated Regulation” concerning the KID for PRIIPs. The report sets out the next steps following the analysis of the received feedback
On 5 February 2019, the political agreement was reached by the European Parliament and EU member states on the targeted EMIR reform with the objective to bring more proportionate rules for corporates
On 31 January 2019, the European Securities and Markets Authority (ESMA) published a statement confirming its awareness of the challenges faced by small financial counterparties to implement and comply with certain EMIR obligations becoming applicable in 2019.
The Commission de Surveillance du Secteur Financier (CSSF) published a press release on Brexit in order to remind the delegation of investment management activities to UK undertakings that will continue to be permissible and about Temporary Permissions Regimes (TPR) for continuity of operations in the UK.
The CSSF released an English translation of the CSSF Circular 18/698 for “GFI”. Although the French original version remains legally binding, this English translation will help Stakeholders to better grasp and share its content.
On 9 January 2019, ESMA and EBA released separately reports on the specific characteristics and use of crypto-assets and the underlying DLTs; the relevance and gaps in existing EU regulations when applied to crypto-assets; as well as divergence in the regulatory approaches adopted by various Member States.
In 2007, the European Parliament and the European Council adopted the Shareholder Rights Directive (SRD) to ensure a better protection of the exercise of rights of shareholders in listed companies.
On 7 January 2019, EU ambassadors endorsed the Council's position on a package of measures, composed of a regulation and a directive, setting out a new regulatory framework for investment firms.
In July 2018, the European Commission invited ESMA to provide technical advice on how to amend the UCITS Directive (2009/65/EC) and AIFMD (2011/61/EU) to integrate sustainability risks and sustainability factors into the two regimes.