CSSF Regulation 15/03 - Marketing of foreign AIFs to retail investors

The CSSF released on December 2nd 2015 Regulation 15/03 (the “Regulation”) laying down general rules for the application of article 46 of the law of July 12th 2013 on alternative investment fund managers (the “AIFM Law”) in respect of the marketing of foreign alternative investment funds (“AIFs”) to retail investors in Luxembourg (the “Retail Investors”).

"The purpose of the Regulation is to clarify the requirements to which foreign AIFs contemplating the marketing of their units or shares to Retail Investors are subject."

It shall apply to each AIF established in a Member State of the European Union (“EU”) other than Luxembourg or in a third country, that wishes to market its units or shares to Retail Investors in Luxembourg and which :

  • is managed by a Luxembourg alternative investment fund manager (“AIFM”) authorised under the AIFM Law; or
  • is managed by a EU AIFM authorised under the AIFMD; or
  • is managed by a third country AIFM authorised under the AIFMD (once such authorisations are permitted).

In addition and for the purpose of the Regulation, investors shall not qualify as Retail Investors within the meaning of the Regulation, if such investors are well-informed investors within the meaning of Luxembourg fund laws or qualify as eligible investors within the meaning of either EU Regulation 345/2013 (“EUVECA Regulation”), EU Regulation 346/2013 (“EUSEF Regulation”) or EU Regulation 2015/760 (“ELTIF Regulation”).

Such foreign AIFs shall apply for authorisation with the CSSF in order to be marketed to Retail Investors by submitting an application file which shall include the following elements:

  • Proof of authorisation and supervisory control of the AIF in its home country;
  • An addendum which shall be appended to the AIF’s issuing document or prospectus for the attention of Retail Investors. Such addendum shall include the information set out in article 5(1) §2 of the Regulation;
  • The AIF’s last annual report;
  • Information on the AIF’s managers;
  • A draft agreement between the AIF and the Luxembourg paying agent;
  • Information on the Master-feeder structure (if relevant);
  • Any other information that the CSSF may deem useful.

The foreign AIF shall also comply, inter alia, with the following requirements:

  • Redemption and subscription prices must be determined at least once a month;
  • Risk spreading and borrowing requirements at least as stringent as those set out in the Regulation;
  • Appointment of a Luxembourg-based credit institution which shall act as paying agent.

The above requirements are without prejudice to the notification requirements set out in the AIFM Law which are applicable to all foreign AIFs (including those that do not target Retail Investors) marketing their units or shares in Luxembourg.