07 December 2021



The CSSF announced a fast track procedure to facilitate compliance with the taxonomy-related disclosure requirements of articles 5, 6 and 7 of the Taxonomy Regulation, which will start applying from 1 January 2022 in respect of the environmental objectives of climate change mitigation and climate change adaptation.

The fast track procedure is available until 17 December 2021 and the CSSF will endeavour to release visa stamps prior to 31 December 2021 for filings received prior to this deadline.

Luxembourg Market Update:

Net assets of Luxembourg-domiciled regulated investment funds totalled €5.60trn at the end of October, a fall of 0.81% from the previous month but still 19.28% up from 12 months ago, according to financial regulator CSSF. Net inflows amounted to €11.3bn last month, but market movements lowered assets by €45.9bn. The number of distinct fund structures declined from 3,539 in August to 3,532, while the number of single-portfolio funds and active sub-funds totalled 14,474.

Assets under management in Luxembourg-domiciled debt funds amounted to €181.7bn at the end of June, an increase of 40.6% over the previous 12 months, according to a study by KPMG Luxembourg and ALFI. Regulated vehicles accounted for 58% of the total, down from 60% in 2020. An increasing number of funds are relatively small with assets of less than €100m, representing 54% of the total this year compared to 44% in 2019.

Regulatory Developments in and beyond Luxembourg:

22 October 2021: ESMA announces new obligations for product disclosures under SFDR

ESMA said the two new SFDR product categories should be created for funds that have an environmental objective.

Article 8, which classifies products that promote environmental, social and governance characteristics, will create a new subset for products that ‘make sustainable investments with an environmental objective.’ Article 9 will also be split into a subset for products that have an environmental objective.

Under these new requirements, Article 9 products will be required to report on their environmental objective to highlight how they have impacted the environment.

Article 8 products with the new environmental objective will face pre-contractual and periodic product disclosures.

3 November 2021: Updated CSSF FAQs on ancillary liquid assets by UCITS

The CSSF has published updated FAQs with information on the holding of ancillary liquid assets by UCITS foreseen under article 41 (2) b) of the Law of 17 December 2010. These updates aim at clarifying the circumstances and the extent to which UCITS are allowed to hold ancillary liquid assets. In this context, some aspects of UCITS and MMF diversification rules have also been clarified.

The new questions have been included in the following FAQs:

  • FAQ concerning the Luxembourg Law of 17 December 2010 relating to undertakings for collective investment: Section 1 and Section 2.
  • FAQ concerning MMFR: Section 2.

Of note is that a Luxembourg UCITS will be only allowed to hold such ancillary liquid assets up to 20% of its NAV (instead of 49% of its NAV under the previous CSSF regulatory practice).

UCITS are expected to comply with the conditions described in these questions as soon as possible and by 31 December 2022 at the latest, considering the best interests of investors.

3 November 2021: IOSCO publishes recommendations on sustainability-related practices, policies, procedures and disclosure in asset management

The International Organisation of Securities Commissions (“IOSCO”) has issued guidelines which offer recommendations on ESG policies, procedures, disclosures for asset managers. The guidelines also cover topics such as supervision and enforcement, industry terminology, and investor education.

4 November 2021: Circular CSSF 21/786

The purpose of the circular is to inform all the entities supervised by the CSSF about the decisions taken by the FATF with respect to high-risk jurisdictions on which enhanced due diligence and, where appropriate, counter-measures are imposed and jurisdictions under increased monitoring of the FATF.

19 November 2021: New registration form for meetings with UCI Departments of the CSSF

The CSSF has announced a new procedure for requesting meetings with the UCI Departments.

Please be informed that:

  • meetings with UCI Departments will, in principle, be scheduled daily between 10 a.m. and 12 p.m. and between 2 p.m. and 4 p.m. on Tuesdays and Thursdays;
  • for proper preparation of the meeting, the applicant is invited to send the form “Registration Form for Meetings with UCI Departments of the CSSF” to Information collected through this form is primarily contextual and organisational in nature (attendees, agenda, etc.).

25 November 2021: Updated RTS under SFDR: Application deferred to 1 January 2023

In its letter of 25 November 2021, the European Commission informed the European Parliament and the Council that the draft regulatory technical standards jointly submitted on 22 October 2021 by the European Supervisory Agencies (ESAs) could not be adopted by the Commission within the three-month period. In its previous letter of 8 July 2021, the European Commission had stated its intention to bundle those draft regulatory technical standards with other RTS in a single delegated act containing 13 RTS in total. The European Commission is now confirming that the date of application of this delegated act is deferred to 1 January 2023.

With respect to the publication of the Principal Adverse Impact at entity level as per article 4 (1) a) of the Sustainable Finance Disclosure Regulation, the European Commission has confirmed that entities will have to comply with those requirements by 30 June 2023, with a first reference period from 1 January 2022 to 31 December 2022.

25 November 2021: The European Commission publishes its draft to amend AIFMD

The European Commission has published its revisions to the AIFM Directive. The proposed changes focus on delegation, liquidity management, marketing, loan origination and depositaries.

On delegation, the Commission proposes to apply delegation rules to all regulated activities, including ancillary services. ESMA is to receive annual notifications from NCAs of delegation arrangements where an AIFM delegates more risk or portfolio management to third country entities than it retains. ESMA will conduct a peer review every two years to look at market practices regarding delegated activities.

The changes proposed on liquidity management, marketing, loan origination and depositaries are not substantial.

The Commission’s proposals will now be scrutinised by the European Parliament and by the EU Council. The changes are unlikely to come into effect before 2024.

29 November 2021: CSSF guidance on virtual assets

The CSSF has published guidance, composed of a communication and FAQs (for UCIs and credit institutions) that will be regularly updated. The CSSF states that:

  • UCITS and UCIs addressing non-professional investors and pension funds may not invest directly or indirectly in virtual assets;
  • AIFs marketing their units only to professional investors and having an authorised AIFM, the authorisation of which extends to the strategy “Other-Other Fund Virtual assets”, may invest directly and indirectly in virtual assets.

29 November 2021: Phased-in implementation of Article 8 of the EU Taxonomy Regulation as from 1 January 2022

The CSSF has published a Communiqué on the phased-in implementation of Article 8, with different rules for financial and non-financial undertakings, and whose first steps are the following:

From 1 January 2022 until 31 December 2022, and in accordance with Article 10 (1) of the Disclosures Delegated Act, non-financial undertakings shall disclose:

(a) the proportion of Taxonomy-eligible and Taxonomy non-eligible economic activities in their total turnover, capital and operational expenditure; and

(b) the qualitative information referred to in Section 1.2. of Annex I of the Disclosures Delegated Act relevant for this disclosure, including but not limited to a description of the nature of their Taxonomy-eligible economic activities, by referring to the Climate Delegated Act.

From 1 January 2022 until 31 December 2023, and in accordance with Article 10 (2) of the Disclosures Delegated Act, financial undertakings shall disclose:

(a) the proportion in their total assets of exposures to Taxonomy non-eligible and Taxonomy-eligible economic activities;

(b) the proportion in their total assets of the exposures to central governments, central banks and supranational issuers, and derivatives;

(c) the proportion in their total assets of the exposures to undertakings that are not subject to the NFRD; and

(d) the qualitative information referred to in Annex XI of the Disclosures Delegated Act.

Article 8 of the Taxonomy Regulation requires undertakings that are subject to the NFRD to disclose information on how and to what extent their activities are associated with economic activities that qualify as environmentally sustainable under the Taxonomy Regulation.

2 December 2021: CSSF announces fast-track procedure for Taxonomy Regulation compliance

The CSSF announced a fast track procedure to facilitate compliance with the taxonomy-related disclosure requirements of the Taxonomy Regulation (“TR”).

The TR enters into force on 1 January 2022. In this context, financial market participants managing financial products subject to Articles 8 and 9 of SFDR will be required to make disclosures in accordance with Article 5, 6 and 7 of the TR with regard to the environmental objectives of climate change mitigation and climate change adaptation in their pre-contractual disclosures by the end of the year.

In this regard, the CSSF has put in place a “TR FastTrack Procedure” to facilitate the submission of UCITS prospectus/issuing document updates to the CSSF. Submissions must be made by 17 December 2021 at the latest in order to qualify for a visa stamp prior to 31 December 2021. Submissions for AIFs will be performed by their respective AIFM.

For further information, please contact:

Tobias Ettlin
m: +352 691 111 931

Disclaimer: This regulatory update has been prepared for clients of ONE group solutions and its subsidiaries for informational purposes and is not intended to be relied upon as professional advice. Please visit:

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