The new CSSF FAQ – Sustainable Finance Disclosure Regulation

On 2 December 2022, the CSSF issued an FAQ in relation to the Sustainable Finance Disclosure Regulation (EU) 2019/2088 (SFDR) (“FAQ”). In its FAQ the CSSF (i) defines which financial market participants (“FMPs”) and financial products are targeted while (ii) providing at the same time further clarifications on aspects of the SFDR.

Scope of the FAQ

The FAQ shall apply to the following FMPs:

  • Alternative Investment Fund Managers (AIFMs);
  • UCITS Management Companies;
  • Managers of a qualifying EuVECA; 
  • and Managers of a qualifying EuSEF.

Financial products within the scope of the FAQ will be Alternative Investment Funds (AIFs) and Undertakings for Collective Investment in Transferable Securities (UCITS) as referred to under Article 2 SFDR. 

According to the CSSF, this FAQ must be read in conjunction with the FAQs issued by the EU Commission, clarifications from the European Supervisory Authorities and CSSF Communiqués on SFDR. In this article, all terms not otherwise defined shall have the same meaning as in the FAQ. 


The CSSF confirms that changes to Article 8 and Article 9 SFDR RTS pre-contractual templates follow the same regime as any other changes made to the prospectus, including those changes which are considered to be material changes in light of CSSF Circular 14/591.

The mere introduction of templates under the SFDR RTS to a prospectus shall not be considered a material change.

Where the portfolio management function has been delegated by a Luxembourg IFM, the latter remains responsible for the website disclosure requirements of Article 10 SFDR in relation to the relevant financial product for which it acts as FMP. The Luxembourg IFM must also ensure that all relevant information pursuant to Article 10 SFDR is made available on its website or on another website.

Minimum investment thresholds disclosed by funds under Article 8 or Article 9 SFDR in their prospectus shall be considered as binding commitments of the investment strategy of the fund. IFMs must ensure ongoing compliance with all the rules set out in the prospectus while the depositary shall monitor the compliance of investment restrictions according to applicable legal provisions.

Investments made by a financial product to which Article 9 SFDR applies should qualify as “sustainable investments” as defined in Article 2(17) SFDR at the date of the actual investments and on an ongoing basis during the life cycle of the fund.

Clarifications are also made concerning the use of exclusion strategies by investment funds disclosing under Article 8 SFDR and Article 9 SFDR:

  • Investment funds disclosing under Article 8 SFDR shall provide a description of how the investment strategy allows to meet the environmental and/or social characteristics. Should only an exclusion strategy be applied as a key element of the ESG strategy applicable to the relevant fund, the CSSF would expect the detailed exclusion strategy to allow investors to understand how the fund’s environmental and/or social characteristics are being met.
  • For investment funds disclosing under Article 9 SFDR, an exclusion strategy only is not acceptable and the underlying assets of such fund must qualify as “sustainable investments”; this does not however prevent investment funds from including other investments for certain specific purposes such as hedging or liquidity which need to fit the overall sustainable investment objective of the investment fund.

Concerning the application date for periodic disclosure requirements, annual reports of UCITS and AIFs (independent of their financial year-end), issued as from 1 January 2023, with funds disclosing under Article 8 and/or Article 9 of SFDR, shall comply with the product disclosure requirements in periodic reports laid down in Article 11 SFDR and further clarified by the SFDR RTS. This includes the information to be presented in an annex to the annual reports by using the mandatory templates.

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