LUXEMBOURG Law and Practice Contributed by: Claudia Hoffmann, Daniel Krauspenhaar, Stefanie Samosny and Sascha Wiemann, Luther
Luther Aerogolf Center – 1B, Heienhaff Senningerberg L-1736 Senningerberg Luxembourg Tel: +352 27484 1 Fax: +352 27484 690 Email: luxembourg@luther-lawfirm.com Web: www.luther-lawfirm.lu
1. General 1.1 General Overview of Jurisdiction
to the European market in combination with its extensive tax treaty networks. • Legislative leadership: Luxembourg has a long track record of early and consistent implementa - tion of European legislation, from the Undertakings for Collective Investment in Transferable Securities (UCITS) Directive and the AIFMD to the European Long-Term Investment Fund (ELTIF) Regulation, all of which exemplify Luxembourg’s agility and adaptability to new developments – the ELTIF Regulation 2.0 is one example of Luxembourg’s positioning well to capture the shift towards semi- professional and high net worth retail investors (so-called democratisation of AIFs). • Balanced regulatory approach boosting investor confidence: the Commission de Surveillance du Secteur Financier (CSSF) maintains a pragmatic yet rigorous supervisory style, enhancing investor protection while supporting financial innovation. 1.2 Key Trends Loan Origination Funds Directive (EU) 2024/927 (AIFMD II) establishes, for the first time, a dedicated European framework for loan- originating AIFs. This provides legal certainty and a harmonised basis for private credit funds across the EU. The new regime expressly recognises both open- ended and closed-ended loan-originating strategies and sets out clear parameters for their operation, thereby facilitating access to this asset class in a regu - lated environment. In particular, AIFMD II acknowledges the possibility for loan-originating AIFs to be structured as open-ended, provided that the AIF’s risk management system is
Luxembourg is one of the smallest countries in Europe, yet it is a global giant in the investment fund industry. Luxembourg is the second largest invest - ment fund centre in the world and is the leading hub for alternative investment funds (AIFs) in Europe. With its funds being offered in over 80 countries and a 55% global market share in cross-border investment funds, Luxembourg remains the leading global distribution centre for AIFs. Its multiple structural and regulatory advantages con - tribute to Luxembourg’s enduring success as a lead - ing hub for AIFs. • Comprehensive legal framework: Luxembourg offers a wide range of regulated and unregulated vehicles, allowing sponsors and managers to tailor their products to their specific tax and regulatory needs. • Institutional infrastructure: Luxembourg hosts a full-service ecosystem of fund administrators, depositaries, auditors and legal advisers highly experienced in cross-border and alternative strate - gies. Over the years, many international sponsors have therefore migrated not just back-office but also risk, compliance and portfolio management functions to Luxembourg. • European and global reach: Luxembourg-domiciled funds benefit from the Alternative Investment Fund Managers Directive (AIFMD) marketing passport across the EEA, making Luxembourg the ideal gate
180 CHAMBERS.COM
Powered by FlippingBook