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    ALFI Newsflash april 15, 2011    
          in this edition      
    1. Headlines
2. News from ALFI's Representative Office in Asia
3. ALFI events
4. LFF events
5. Other events



CSSF published new warnings regarding TradeLike Tom and Bank Sewell & Raydell

For further information about TradeLike Tom, please click here. For further information about Bank Sewell & Raydell, please click here.

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CSSF has released its Circular 11/508

On Monday, 18 April 2011 the CSSF has released its Circular 11/508 on the requirements that will apply to Chapter 15 management companies under the law of 17 December 2010 on collective investment undertakings and to self-managed investment companies governed by Article 27 of the Law.

The Circular details the provisions applying to

  • organisational requirements (II) ;
  • conflicts of interest (III) ;
  • conduct of business rules (IV) ; and
  • risk management (V).

of UCITS (IV) Management Companies and UCITS (IV) Self-Managed Investment Companies. The requirements apply to every UCITS IV Management Company whether it manages UCITS, UCIs or Specialised Investment Funds (SIFs).

Pursuant to the new circular UCITS (IV) Management Companies must file with the CSSF an update of their application file, completed by the new provisions under the Law and, in the case of Self-Managed UCITS (IV) Investment Companies a new file by 1 June 2011 latest.

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ESMA sets out guidelines on risk measurement and the calculation of global exposure for certain types of structured UCITS

ESMA publishes the final report on the guidelines on risk measurement and the calculation of the global exposure for certain types of structured UCITS (ESMA/2011/112). The report contains the policy approach agreed by ESMA, the cost-benefit analysis, the feedback from the public consultation and the draft guidelines in English to be addressed to competent authorities and UCITS management companies.

The final version of the guidelines (which will be unchanged) will be translated into all the European Union languages and will be available at a later stage on the ESMA website. The guidelines will take effect when this translation process is completed and will accompany the Level 2 implementing measures of the UCITS Directive that take effect on 1 July 2011. The report published today will nevertheless help UCITS management companies and national competent authorities prepare in a timely manner.

The purpose of the guidelines is to propose, for certain types of structured UCITS, an optional regime for the calculation of the global exposure. The specific approach adopted by ESMA consists of the calculation, for each scenario to which investors can be exposed at any one time, of the global exposure using the commitment approach. Under this approach, each scenario must comply at all times with the 100% global exposure limit.

The guidelines, when they take effect, will supplement the guidelines published by the Committee of European Securities Regulators (CESR) in July last year on Risk Measurement and the Calculation of the Global Exposure and Counterparty Risk for UCITS (Ref. CESR/10-788).

ESMA considers that the scope of this alternative approach must be clearly defined. Therefore, a list of all the criteria with which structured UCITS should comply in order to be able to benefit from this specific approach is set out in Guideline 1 of the report. A number of examples have also been included to illustrate how the optional regime should be applied in practice. Guideline 2 in the report, meanwhile, sets out additional disclosure obligations on UCITS that make use of the optional regime.

Read more

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Exchange of information upon request: further adaption of double tax conventions to OECD standard

On 2 March 2011, the Luxembourg Minister of Finance submitted draft law n° 6257 to the Parliament. The bill aims at introducing newly negotiated double tax conventions and further adaptions to existing double tax convention, to bring them in line with the international OECD standard, in particular with regard to the rules on exchange of information upon request.

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Germany: UCITS IV and related rules on investor information

The German Parliament (“Bundestag”) adopted last Friday the UCITS IV implementing law, which will now be handed over to the Federal Council (“Bundesrat”) and later be published in the official gazette (“Bundesgesetzblatt”) to enter into force, probably in May 2011.

As mentioned in our newsflash of 17 February 2011, all types of German funds (UCITS and non-UCITS) and foreign non-UCITS distributing to Germany will have to provide a Key Investor Information Document (KID) as of 1 July 2011, whereas non-German UCITS can continue to use the simplified prospectus according to the transitional provisions in force in their own Member State (in Luxembourg: 1 July 2012).

The discussion has been complicated by the adoption of the law aiming at strengthening investor protection ("Anlegerschutz- und Funktionsverbesserungsgesetz”), which has been published in the Bundesgesetzblatt (BGBl. I page 538), and entered into force on 8 April 2011. This legislation lays down requirements for the distribution of some savings products, including investment funds. Distributors will be required to provide to retail investors a disclosure document called "Produktinformationsblatt (PIB)", similar but not identical to the UCITS KID. The legislation provides for the possibility to use the KID as of 1 July 2011 to fulfil the PIB requirement, and in the final text it has been recently clarified that the simplified prospectus can be used instead of the PIB by non-German funds during their transitional period. In other words, to avoid providing a PIB, a KID will be required for German UCITS from 1 July 2011 while for foreign UCITS the simplified prospectus may continue to be provided up to 1 July 2012 (according to their transitional period).

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EMIR - revised timetable

The European Parliament Legislative Observatory has published a procedure file regarding the Regulation on OTC derivatives, central counterparties and trade repositories (also known as the European Market Infrastructure Regulation - EMIR). The file contains an updated timetable of procedural events including:

  • the Council is expected to reach political agreement on the final act on 17 May 2011;
  • the European Parliament is expected to have a report scheduled for adoption in committee, 1st or single reading on 24 May 2011;
  • the European Parliament is expected to have a plenary sitting on 7 June 2011 (indicative date).

For further information please click here.

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Presidency compromise proposal on EMIR

The Presidency of the Council of the European Union has published a further Presidency compromise proposal, dated 11 April, on the proposed Regulation on OTC derivative transactions, central counterparties and trade repositories (European Market Infrastructure Regulation – EMIR). The proposal will be discussed at the meeting of the Working Party of Financial Services Attachés on 13-14 April. Following that meeting, the Presidency intends to further amend the compromise text with a view to the meeting of 28 March 2011.

For more information please click here.

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European Commission initiatives for 2011

The European Commission has published a table containing estimated dates for the issue of a number of legislative initiatives for 2011. The following are on the "Commission work programme - strategic initiatives":

  • amendment of the Capital Requirements Directives, due 22 June 2011;
  • legislative initiative on a framework for crisis management and resolution in the banking sector, due 29 June 2011;
  • recast of the operation of the insider dealing and and market manipulation (market abuse) Directive, due 5 July 2011;
  • review of the Market in Financial Instruments Directive, due 5 July 2011; and
  • amending the Regulations on credit rating agencies, due September 2011.

The following initiatives are on the "Commission programme - Annex II":

  • Securities Law Directive, due May 2011;
  • proposal of a Directive to amend Directives on internal governance of credit institutions and investment firms, due 7 June 2011;
  • framework for crisis management and resolution in the banking sector, due 29 June 2011;
  • amendment of the Undertakings in collective investments in transferable securities  Directive (UCITS IV), due 13 July 2011;
  • instrument creating a framework for standardising pre-contractual information for retail investors about packed retail investment products (PRIPs), due 13 July 2011;
  • Directive on Insurance Guarantee Schemes, due Q4 2011;
  • Directive establishing framework for the approximation of sanctioning regimes in the financial sector, due Q4 2011;
  • review of the Directive on transparency obligations of listed companies, due October 2011;
  • revision of Insurance Mediation Directive, due Q4 2011; and
  • Directive on close-out netting, due July 2011.

Please click here to see the table.

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The EU corporate governance framework

The European Commission published on 5th April 2011 its Green Paper entitled “The EU corporate governance framework”.

The Green Paper aims to launch a general debate on a number of issues:

  • including Board of Directors (including composition, board evaluation and directors remuneration)
  • Shareholders (in particular the agency relationship between institutional investors and asset managers)
  • “Comply or Explain” Framework – Monitoring and implementing corporate governance codes

Contributions can be sent to the European Commission until 22 July 2011 at the latest.

The Green Paper can be found on the Commission’s website following this link.

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Harmonisation of securities law: Summary of responses

The European Commission has published a brief summary of the responses that it received in relation to the Directorate-General’s Internal Market and Services' second consultation on legislation aimed at achieving harmonisation of laws on securities holding and dispositions across the European Union.

Please click here.

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FATCA: letter sent by the EU to the US tax authorities and second notice

In a letter sent to the US tax authorities on 6 April 2011, the Hungarian Presidency of the Council of the European Union and the European Commission invited the US authorities to engage in a dialogue on how to best achieve the objectives of the US Foreign Account Tax compliance Act (FATCA).

FATCA is a US legislation intended to ensure that US tax authorities obtain information on investments by US residents in foreign financial institutions, including European financial institutions. In this regard it pursues goals similar to those of the EU Savings Tax Directive which provides for an exchange of information between tax authorities of EU Member States. However, FATCA could impose a significant compliance burden on EU financial institutions (including banks, investment funds and insurance companies). In light of the information exchange tools that already exist between tax administrations, and given the ongoing discussions on extending the scope of the Savings Tax Directive, which is a priority for the Hungarian Presidency and the Commission, the Hungarian Presidency and the Commission invited the US authorities to consider exploiting possible synergies to achieve their common goals in a cost-effective and business-friendly way.

Please click here for the full text of the press release.

Following Notice 2010-60, the Internal Revenue Service (IRS) has published on 9 April Notice 2011-34 containing some further guidance on FATCA, in particular on the following areas:

  • the method Foreign Financial Institutions (FFIs) should use to identify the status of both existing accounts and new accounts (i.e. accounts opened on or after 1 January 2013)
  • the treatment of "passthru payments"
  • certain FFIs that can be deemed compliant with the information reporting requirements without entering into a reporting agreement  
  • the reporting required to the IRS on US accounts
  • compliance procedures for FFI affiliated groups

ALFI is closely following the topic and contributes to the work of EFAMA’s FATCA working group, which is in direct contact with the US authorities. On 29 April 2011, ALFI will host a Breakfast Seminar on FATCA.

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Secretary General within the EFRP - vacancy

The EFRP is looking to recruit a Secretary General to lead the federation. Please consult the job advert by clicking here.

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IFBL training programmes: Real Estate Investment Fund Professional courses

The IFBL would like to remind all those persons interested in the Real Estate Investment Fund Professional courses that these will be starting again shortly. The first course in this series, Fundamentals of Real Estate, will be delivered on the 26th April.

Participants to these courses have the opportunity to learn and receive certifications in: the fundamentals of real estate, structuring / tax and the roles and responsibilities of industry actors, before moving on to more specific modules involving business processes, accountancy and fair valuation.

Full details of our courses are provided in the flyer.

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LFF: Mediawatch

To consult LFF Mediawatch please click here.

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News from ALFI's Representative Office in Asia

Hong Kong - SFC published an updated FAQs related to the application procedure of unit trusts and mutual funds

On 25 March 2011, the Hong Kong regulator, SFC, published an updated FAQs related to the application procedure of unit trustsand mutual funds.

In the document, the regulator explains that “a 12-month period is a reasonably sufficient period for a serious applicant to address the SFC’s requisitions and obtain the relevant authorization”. Also, if some information (risk disclosure, financial information …) becomes obsolete during the application, the applicant shall update it. Otherwise the SFC is entitled to stop the submission process and application fees will not be refunded. The same outcome applies for the unit trusts and mutual funds which have not reached authorization after the 12-months period. A new application will have to be resubmitted to the regulator and the same application procedure shall be repeated.

Please refer to the link for the FAQs.

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Hong Kong - SFC published an updated FAQs on post-authorisation compliance issues of SFC-Authorised Unit Trusts and Mutual Funds

On 21 February 2011, the Hong Kong regulator, SFC, published an updated FAQs related to post-authorisation compliance issues associated to SFC-Authorised Unit Trusts and Mutual Funds.

In order to rationalise the management of pricing errors disclosures, detailed calculation of the compensation made to investors is no longer required to be filed with the regulator. Nevertheless the fund manager still has to file some information such as: a summary of nature of error, confirmation that the home regulator has no comment on the error, etc. As always, the regulator reserves the right to request the submission of further information and documents as it deems appropriate on a case-by-case basis.

Please refer to the link for the FAQs.

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Hong Kong - SFC published an updated FAQs on the Code of Unit Trusts and Mutual Funds

The FAQs on the Code of Unit Trusts and Mutual Funds was revised on 21 February 2011.

Please refer to the link for the FAQs.

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Hong Kong - SFC published an updated FAQs on SFC authorization of UCITS III Funds

The FAQs on SFC authorization of UCITS III Funds was revised on 21 February 2011.

Please refer to the link for the FAQs.

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Singapore – MAS published a revised Code on Collective Investment Scheme

The regulator of Singapore, MAS, has published on 8 April 2011 its revision of the Code on Collective Investment Scheme.

The revised Code will apply to all authorized schemes other than structured product funds and will come into effect on 1 October 2011.

Please refer to the link for the revised Code.

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ALFI events

2011 Confirmed Events Dates

 19 May

 ALFI Conference London

 9 June

 ALFI Annual General Meeting

 15 & 16 June

 ALFI Roadshow to Switzerland (Zurich & Geneva)

 6 September

 ALFI Roadshow to Edinburgh

 26 September

 ALFI Golf Tournament

 27 & 28  September

 ALFI Global Distribution Conference in association with   NICSA & HKIFA-20th Anniversary!

 4 - 7 October

 ALFI Roadshow to Toronto & USA

 24 October

 ALFI Seminar Frankfurt

 22 & 23 November

 ALFI European Alternative Investment Funds Conference









ALFI events calendar 2011- please click here.

ALFI endorsed events 2011- please click here.

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29 April: ALFI Breakfast meeting - FATCA

ALFI has the pleasure to inform you that the next Breakfast meeting, during which we will give an update on FATCA and the implications for the Luxembourg Fund Industry will take place at Chambre de Commerce on Friday, April 29th, 2011, from  08.00-11.00 (registration from 08.00 – 08.30 a.m).


Georges Bock, KPMG (Moderator)

Gudrun Goebel, Société Générale Securities Services Luxembourg

Jon Griffin, JPMorgan Asset Management (Europe)

Céline Maassen, EFAMA

Federica Liberatore, EU Commission

For registration please refer to the personalized link in the e-mail previously sent to you.

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4 May: ALFI Leading Edge Conference N°3

Towards the Successful Implementation of the AIFMD - Identifying opportunities - Adressing Challenges

Register by Wednesday 20th April to have your name listed on the printed delegates list. Already 140 people registered!

Click here for programme and registration details.

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19 May: ALFI Conference London

Programme and Registration online!

Click here for the conference website.

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15 & 16 June: ALFI Roadshow to Switzerland (Zurich & Geneva)

Programme and registration coming soon.

Click here for the website.

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27 & 28 September: ALFI Global Distribution Conference in association with NICSA & HKIFA

Sponsorship and Exhibition Opportunities available! Please click here

This two-day conference will provide presentations and panel discussions on latest news and trends in the cross-border distribution of Luxembourg investment funds, with this year a focus on the Asian region.

Highlights of the programme include:

  • CEO interviews
  • Global Issues in Asset Management
  • Cross-Border Success Story
  • Asian Distribution Dynamics
  • The Future of UCITS in Asia
  • The History of the Luxembourg Fund Industry
  • Vision of the future of the Luxembourg fund industry
  • Investors’ protection
  • Managing the Regulatory Changes
  • Deep Dive into Distribution
  • and many more

Programme and registration coming soon.

Click here for the conference website.

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LFF events

30 May - 1 June: Economic mission to Norway

Please find here the invitation letter of LFF which is taking part in the economic mission organised by the Chamber of Commerce and Luxembourg for Business within the framework of the State Visit to Norway. For more information, invitation, programme and registration form, please click here.

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Other events

27 & 28 April: Portuguese Trade Mission to Luxembourg

1. Luxembourg and Brazil business relations

In an interview with LFF, Guilherme Bezerril, Head of the Latin America desk at SGG, says why business between Brazil and Luxembourg will be easier in the future. For more information follow this link.

2. Innovating Portugal

Luxembourg Chamber of Commerce and AICEP Portugal Global have the pleasure to invite you to the economic forum Innovating Portugal, organised under the Patronage of the Embassy of Portugal in Luxembourg as well as with the support of the Portuguese-Luxembourg Chamber of Commerce and the Belgian-Luxembourg Chamber of Commerce in Portugal on April 28, 2011 in the premises of the Luxembourg Chamber of Commerce (7, rue Alcide de Gasperi, L-1615 Luxembourg-Kirchberg).

This event is a follow-up of the successful economic and financial mission in Lisbon with a business delegation of 50 businessmen from Luxembourg, organised in the framework of the State Visit to Portugal in September 2010.

A common seminar on business opportunities with Portugal will be held at the Chamber of Commerce in the morning, focusing on the following sectors:

  • renewable energies and electric mobility;
  • information and communication technologies;
  • finance;
  • logistics;
  • food & beverage.

The seminar will be followed by B2B meetings organised between the Portuguese business delegation composed of 15 companies of the sectors mentioned above and the Luxembourg companies. After a networking lunch, B2B meetings will then be continued in the afternoon.

Please find enclosed the programme of the seminar, the profiles of the Portuguese business delegation and the registration form.

In case of interest to participate in the event “Innovating Portugal”, you are kindly invited to complete the attached form and return it no later than April 26th to Mrs Anne-Marie Loesch / Mrs Carmen Beyerle, fax: 43 83 26, e-mail: international@cc.lu.

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3 May: “Measuring returns in Private Equity: Concepts, historical evidences and impacts on portfolio construction“

Lecture by Pierre Yves Mathonet, head of private equity risk management unit at European Investment Fund, on the performance, risk and asset allocation concepts around private equity.

This event is organised by by the CFA Institute in association with the Sacred Heart University.

Read more.

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7 & 8 June: IFBL/ILA/ALFI : SAVE THE DATE - Roles and Resp. of the Directors and Managers of UCIs

The IFBL is pleased to announce the new date for the strongly demanded seminar “Roles and Responsibilities of the Directors and Managers of UCI and other investment vehicles” in cooperation with ILA (Luxembourg Institute of Directors) and ALFI (Association of the Luxembourg Fund Industry).

This interactive seminar includes theoretical basics, presentations by professionals, exchanges between participants and the resolution of a specific corporate case study.

The session consisting of 12 hours is split over one and a half days

- Tuesday, 7th June (from 9.00 a.m. to 6.15 p.m.)

- Wednesday 8th June (from 9.00 a.m. to 12.30 p.m.)

The presentations will be held in English.

Should you have any further query, please do not hesitate to contact our Customer Service (by mail: customer@ifbl.lu or by phone : +352 – 46 50 16) for further information.

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