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Understanding Investing 简体中文网页 Members section

- Press releases

The Luxembourg Stock Exchange in cooperation with the Association of the Luxembourg Fund Industry (ALFI) has announced today the publication of the second edition of the compendium of Luxembourg laws and regulations on investment funds.

The compendium, which is available in English, French and German, is made up of two separate publications in each language. The first publication covers undertakings for collective investment in transferable securities (UCITS) established under Luxembourg law and contains the amended Law of 17 December 2010 on undertakings for collective investment as well as the main regulatory texts relating thereto.

The second publication covers alternative investment funds (AIFs) established under Luxembourg law and other investment vehicles which are neither UCITS nor AIFs. It contains the amended Law of 12 July 2013 on alternative investment fund managers (AIFM), the amended Law of 17 December 2010 on undertakings for collective investment, the new Law of 23 July 2016 on reserved alternative investment funds (RAIF), the amended Law of 13 February 2007 on specialised investment funds (SIF), the amended Law of 15 June 2004 on the investment company in risk capital as well as the main regulatory texts relating thereto.

Denise Voss, Chairman of ALFI, comments: “The compendium has proved an invaluable tool for legal experts and practitioners dealing with Luxembourg collective investment vehicles. An update of the first edition was necessary because of two major regulatory developments in 2016 which were the transposition of UCITS V into the Luxembourg legislation and the adoption of the Law on reserved alternative investment funds, a new vehicle that is attracting much attention from asset managers.

These publications have been extremely useful to our members and to the international investment fund community, and I’m sure they will continue to be so”.

Robert Scharfe, Chief Executive Officer of the Luxembourg Stock Exchange, adds: “Investment funds are the second largest sector on the Luxembourg Stock Exchange, with more than 6,500 listings. As an international exchange serving a global base, we believe that these two publications respond to a clear need from the fund industry and provide an essential reference”.

These two publications of the main legal and regulatory texts were produced by the two Luxembourg law firms, Arendt & Medernach and Elvinger Hoss Prussen, who have cooperated to select, consolidate and compile the legal and regulatory texts relevant to the different types of investment vehicles concerned. The two law firms also prepared the English and German translations.

The publications are available in French, English and German and can be downloaded at and at

Regular updates will be published to keep track with ongoing changes and additions to Luxembourg laws, regulations and circulars.


Updated on 23/03/17
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- ALFI statements

The Joint Committee of the European Supervisory Authorities (ESAs) has published a discussion paper for consultation regarding the potential benefits and risks of big data for consumers and financial firms in order to determine whether any further regulatory or supervisory actions may be needed.

The ESAs wish to understand what the big data phenomenon means for consumers, the financial industry and regulators. Existing EU legislation on data protection, competition and consumer protection, which shares the common goals of promoting economic growth, innovation and the welfare of individual consumers, are relevant for financial firms while not addressing big data issues explicitly.

The discussion paper asks whether the existing regulatory framework is sufficiently flexible to cover big data, has gaps which need to be filled and how it impacts the use of big data technologies.

A Q&A document provides clarifications on big data, its purpose and application in the financial sector.

Download the ALFI response here.

Updated on 20/03/17
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- Studies

2016 was another good year for Luxembourg domiciled REIFs as the population continued to expand, ALFI writes in the 10th edition of its annual Real Estate Investment Funds (REIF) survey that has been published today.

Updated on 26/09/17
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- Publications

These joint recommendations have been prepared by representatives of ALFI and ILA’s working group specifically dealing with VAT on the remuneration of directors of UCIs and their management companies. The working group comprises independent directors, representatives of management companies, audit firms and law firms. ALFI and ILA hope that this document will serve their members as a reference document.

These recommendations deal exclusively with considerations on VAT for the remuneration of directors of UCI management companies. They do not address any other regulatory obligations and other tax obligations that directors of UCI management companies may be subject to. These recommendations do not address the situation of vehicles other than UCIs benefiting from VAT exempt management services pursuant to article 44.1.d) of the Luxembourg VAT law, i.e. pension funds and securitisation vehicles.

Download the document here.

Updated on 20/03/17
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- Press releases

With 3,701.076 billion EUR of assets under management as at 31 December 2016, an annual growth of 5.56%, Luxembourg reports another new record of assets under management in investment funds domiciled in Luxembourg. Luxembourg is well-known as a UCITS fund hub, however since the introduction of the Alternative Investment Fund Managers Directive (AIFMD), the Association of the Luxembourg Fund Industry (ALFI) has seen increasing interest from asset managers of Private Equity, Real Estate and Hedge funds.

Commenting on the figures, Denise Voss, Chairman of ALFI (photo), said: “These record figures and the strong net sales that we continue to see demonstrate that Luxembourg remains a preferred global fund hub.  We were particularly pleased to receive recognition of this by being awarded “Best Centre for Fund Administration” in the Investment Week Fund Services Awards 2016. 

She continued: “2016 was a challenging year in many respects. First the UK vote to exit the EU has brought uncertainty to cross-border distribution in Europe, with the possible loss of both fund and fund manager passports for UK asset managers.  Second we have seen the threat of US protectionism with the election of Donald Trump.

“However, these challenges can bring opportunities.  UK asset managers, and those asset managers from other non-EU countries who currently use the UK to access investors in Europe will, once the UK leaves Europe, have to domicile their funds in an EU member country. Luxembourg continues to be one of the most sought after EU countries for setting up investment funds and fund management companies and clearly this will continue throughout the Brexit process.  We have already had confirmation that M&G, one of the largest UK asset management firms, is seeking permission from the Luxembourg authorities to launch a new UCITS fund.  We understand other firms will make public similar plans in the next weeks and months.

“We are also seeing opportunities brought by digitalisation and the growth of fintech companies.  Online investment is slowly but surely continuing to grow, robo advice is developing and, as a result, we have to change our way of working, not only to facilitate these new technologies and distribution platforms but to take advantage of the efficiencies digital technologies can offer our industry.”

ALFI has continued to support the industry in the face of all this change, by continuing to promote the Luxembourg domicile and global fund hub. In 2017 ALFI has another ambitious schedule of  roadshows, in Asia, Australia, the USA and Latin America. ALFI is also setting up a working group which will promote increased collaboration and closer relationships between the fund management centres in Luxembourg and Singapore.  In Australia, ALFI has successfully negotiated an exemption, for financial services providers regulated by the CSSF, from the obligation to hold an Australian   license to provide financial services in Australia. This relief will enable Australia’s institutional investors, including superannuation funds, to get easier access to Luxembourg UCITS.

ALFI will continue to focus on product innovation to attract more asset managers to Luxembourg by introducing new products like the RAIF, the Reserved Alternative Investment Fund, as well as focussing on the SRI sector by promoting impact investing and climate finance funds.

Ms Voss concludes: “Looking forward, we continue to see challenges and opportunities, driven by geopolitical changes, technological developments and regulatory initiatives, but as always Luxembourg will adapt its products and services to ensure that it continues to be the preferred choice for cross-border asset managers and for investors in Luxembourg funds, who are resident in over 70 countries around the world.”

Updated on 16/03/17
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- ALFI statements

On 10 February 2017, ALFI responded to the FSB Task Force on Climate-related Financial Disclosures consultation.The FSB Taskforce on climate related financial disclosures published its report ‘Recommendations of the Task Force on Climate-related Financial Disclosures’. It includes four recommendations on governance, strategy, risk management and metrics & targets that are applicable to organisations across sectors and jurisdictions. The Taskforce launched a consultation on these recommendations in December.

Download the ALFI response here.

Updated on 10/02/17
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- Press releases

Ten years after having established its very active Representative Office in Hong Kong, the Association of the Luxembourg Fund Industry (ALFI) has now extended its presence in South East Asia by launching a new working group which will promote increased collaboration and closer relationships between the fund management industries in Luxembourg and Singapore.

The working group, based in Singapore, will focus its efforts on South East Asia where the Luxembourg fund industry is already well established. According to a survey on global fund distribution, 69% of all foreign funds sold in Singapore are domiciled in Luxembourg.

The working group aims to improve the Luxembourg fund industry professionals’ understanding of the investment fund market in Singapore and South East Asia, its laws and regulations, local investment culture and management techniques, as well as distribution challenges and opportunities. In addition, the group will explore ways to further develop the Luxembourg investment fund centre as a hub of excellence for professional services for Asian-based investment funds and their sponsors.

Mrs. Ching Yng Choi, Head of ALFI’s Asia Representative Office in Hong Kong, commented: “The working group will also be instrumental in proposing and preparing promotional activities and trade missions in the region, and will be setting up a knowledge base to share insight with local industry players. This launch is further testament to the commitment ALFI has towards Asia, and follows the opening of our Hong Kong office in 2010.”

The ALFI Singapore Working Group is chaired by Mrs. Valérie Mantot, Head of MENA and South East Asia at Sanne Group, and Mrs. Ching Yng Choi, Head of ALFI’s Asia Representative Office in Hong Kong.

With Asia remaining one of the key focuses in 2017, ALFI has planned a series of initiatives in the region following a successful roadshow in Hong Kong, Taipei and Tokyo in January. The Association will bring a delegation, led by H.E. Pierre Gramegna, Luxembourg’s Minister of Finance, to Asia and Australia in March to further strengthen the relationship and facilitate knowledge sharing between this region and Luxembourg. The programme of this roadshow will include seminars in Singapore on 10 March and in Sydney and Melbourne on 13 and 14 March, respectively.

Updated on 07/02/17
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- ALFI statements

On 2 February 2017, ALFI responded to the EBA discussion paper entitled “Designing a new prudential regime for investment firms”

Updated on 03/02/17
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- Press releases

From 10 to 13 January 2017, ALFI held its annual roadshow to Taipei, Tokyo and Hong Kong, a well acclaimed opportunity for senior professionals from Luxembourg and Asia to discuss cutting-edge issues affecting the asset management and investment fund industry.

ALFI Hong Kong Roadshow 2017


In Tokyo and Hong Kong, the delegation of industry players and representatives of the Luxembourg financial regulator CSSF was joined by H.E. Pierre Gramegna, Minister of Finance of the Grand Duchy of Luxembourg who made a keynote address on 2017 as a game changing year for Europe and the world economy. The local regulators – the Financial Services Agency of Japan (FSA), the Securities and Futures Commission of Hong Kong (SFC) and Luxembourg’s Commission de Surveillance du Secteur Financier (CSSF) – then presented their top priorities for 2017.

Another conference highlight was the asset flow panel focusing on key markets, emerging distribution channels, new products “Made in Luxembourg” and related structuring. The most recent key developments in the area of regulation and taxation (PRIPS, MiFID II and UCITS V) were on the agenda as well.

Moreover, in Taipei, an investment fund market review was presented by a local data intelligence agency, and in Hong Kong, a local economist shared with the audience an interesting outlook on future developments in Asia and their likely impact on Europe.

Topics covered in all the three cities were a multi-layered approach for investor protection and FinTech, with namely a presentation on BlockChain.

Updated on 27/01/17
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- Press releases

Launched on Monday, 5 December, the Shenzhen-Hong Kong Stock Connect provides international investors with another direct link to access China’s domestic A-shares market and especially the stocks listed on the tech-heavy Shenzhen market. This further opening of mainland China’s capital market gives Luxembourg investment funds access to new asset classes.

The Shenzhen-Hong Kong Stock Connect (“Shenzhen Connect”), the link between the Shenzhen and the Hong Kong stock exchanges, was launched on Monday, 5 December. Shenzhen Connect is another milestone in deepening mutual access between the capital markets in China's mainland and Hong Kong. Shenzhen Connect is the second link of its kind to boost the opening up of the mainland China's capital market after a similar link between the Shanghai and Hong Kong exchanges was launched in 2014. The market infrastructure arrangements under Shenzhen Connect replicate those provided for under the original Shanghai-Hong Kong Stock Connect (“Shanghai Connect”) pilot programme.

The Shenzhen Connect is aimed at giving global investors access to stocks in the tech-heavy Shenzhen market via Hong Kong Stock Exchange (“HKEX”), it provides access to China’s new economy. A total of 417 stocks on the HKEX are eligible for trading, and 881 stocks are eligible on the Shenzhen Stock Exchange (“SZEX”). The list of stocks that are eligible for Northbound trading is available in the Stock Connect section of the HKEX website and will be updated daily.

Before Shenzhen Connect went live, HKEX has completed three rounds of connectivity testing and market rehearsals to ascertain technical readiness of the market infrastructure and operational readiness of market participants.  One hundred forty-two China Connect Exchange Participants (CCEPs) are expected to be eligible to participate in the two Stock Connect programmes from 5 December 2016, while other Exchange Participants (EPs) can also apply to become CCEPs later upon satisfaction of relevant requirements[1].

Luxembourg investment funds have traditionally been exposed to the Chinese capital markets through different schemes and channels. Marc-André Bechet, Director Legal & Tax at the Association of the Luxembourg Fund Industry (ALFI) outlines that “China has emerged as one of the world’s leading economies following decades of growth that has hovered around 10% annually. The Shenzhen Connect provides international investors with another direct link to access China’s domestic A-shares market outside of the existing route of getting a foreign investor license through the Qualified Foreign Institutional Investor (QFII) and Renminbi QFII (RQFII) programmes. Practically, Stock Connect allows managers to increase their China A-Shares exposure via an alternative channel without having or using their own QFII or RQFII license or quota. Stock Connect also allows managers without a QFII or RQFII license to increase their China A-Shares direct exposure without having to rely on more expensive China A-Shares access products.”

Luxembourg acts as China ́s gateway to Europe and vice versa and is one of Europe ́s leading centres for international RMB business. In April 2015 the People's Bank of China granted a 50 bn RMB RQFII quota to Luxembourg[2]. Subsequently, increasing numbers of international asset managers are choosing Luxembourg as the domicile for their funds ranges that invest into China.

Access to a new asset class

Luxembourg UCITS are marketed in up to 70 different countries, so setting up a UCITS which invests in China through the Stock Connect links or through RQFII gives access to not only an asset class but re-inforces the interest of an international investor base for Luxembourg products, which is extremely beneficial regarding distribution. Luxembourg was the first European jurisdiction to authorise the use of an RQFII quota in the context of a UCITS fund back in 2013. After the launch of Shanghai Connect in November 2014 a Luxembourg UCITS fund has become the first to receive authorisation to use the Stock Connect programme and since that time over 125 additional UCITS have received authorisation. Supported by the continuous engagement by ALFI, the Luxembourg fund industry embraced the new access link and the first UCITS funds used Shenzhen Connect from the beginning. The CSSF confirmed that it accepts the new programme on a similar basis as the Shanghai Connect programme two years ago.

A number of Luxembourg UCITS have already seen the opportunity offered by this second link and sent their applications to the supervisory authority or are about to update their investor information and where necessary the legal and contractual documentation.

Factors to consider by Luxembourg funds

There are a number of factors which require careful consideration and appropriate solutions for those Luxembourg UCITS funds considering accessing this market through the Shanghai or Shenzhen Connect. The Luxembourg UCITS fund, the management company and depositary designated by the fund must give due consideration to a number of factors and ensure that their risk management procedures adequately cover them. These factors include:

  • accounts opened by the depositary of the UCITS with a sub-custodian in Hong Kong are segregated at the level of the UCITS' sub-funds or structured as UCITS client assets omnibus accounts of the Luxembourg depositary with that sub-custodian;
  • broker models limiting counterparty risk are to be preferred;
  • the prospectus, and most particularly the KIID, will contain a specific disclosure to inform investors of the specific legal risks linked to compulsory requirements of the local CSDs, HKSCC and ChinaClear for custody of securities on a cross-border basis.

Furthermore, as the market infrastructure arrangements under Shenzhen Connect align with those provided for under the original Shanghai Connect pilot programme, launched in November 2014, most of the disclosures needed for implementing Shanghai Connect are still valid and will also similarly apply for the Shenzhen Connect.

Moreover, as a general rule the prospectus shall provide an indication to which extent the new programme will reflect the investment strategy of a UCITS compartment or whether the new programme is simply added as one additional way of investing in Mainland China.

Given that Shenzhen Stock Exchange gives access to corporates of small and medium size and operating in other economic sectors than the entities listed on Shanghai Stock Exchange, the investment policy of the UCITS intending to invest through Shenzhen Connect must ensure that investor information is in line with this specific asset class and sector.

Finally, as a general principle, the UCITS, its management company, the appointed portfolio managers, its depositary must undertake and maintain their usual due diligence and suitability testings on the additional market framework and practices, on the assets to be invested as well as on the settlement and custody processes before considering investment. In particular, procedures for identifying and monitoring specific risks that may imply these investments must be in place or adapted accordingly before using the Shenzhen Hong Kong Stock Connect.

* * *

Download the press release here.


Updated on 06/01/17
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