Olivier Sciales Law Blog

Luxembourg politicians and officials have expressed confidence that the European Union’s AIFM Directive will soon win final approval dispute this week’s latest dispute between member states on the contentious issue of access to EU markets for managers and funds based outside the union.

Speaking to delegates at the annual investment fund conference organised by the Luxembourg fund association Alfi and US trade body Nicsa on 27 -28 September, the country’s finance... Read More

The European Union’s economic affairs and finance ministers holding informal talks in Brussels in a bid to break a fresh deadlock over the way the proposed AIFM Directive treats alternative investment managers and funds based outside the 27-member union.

According to media reports, France is now ready to block any proposal that would give non-EU funds a passport that would mean once approved in one EU country, the funds could be distributed freely in other member states in the... Read More

Luxembourg’s fund industry is keenly awaiting the outcome of negotiations between the European Union’s legislative institutions on the final form of the proposed Directive on Alternative Investment Fund Managers. Finalisation of the directive could open up new opportunities for Luxembourg as a domicile and servicing centre for alternative funds, but the EU has been slow to reach agreement on a number of outstanding issues, notably the treatment under the directive of managers... Read More

On January 12, 2010, to confirm Luxembourg's commitment to Islamic Finance, the Luxembourg tax administration has issued a circular L.G.-A No. 55 (12 January 2010) in order to provide guidance on Islamic Finance (the “Circular”).

The Luxembourg tax administration refers to Islamic Finance as the “financial instruments used by investors who wish to manage their investments observing the values of Islam”. The objective of Islamic finance is, according to such... Read More

I.  Introduction

Well established as a world leader in the investment funds industry (second only to the USA), Luxembourg firmly held its position throughout the economic crisis, totalling EUR 1,840.993 billion net assets under management as at 31 December 2009. This five decade long success story originates from a continuing intention on the part of the local authorities to make the most of promising opportunities in the financial market. Islamic Finance is... Read More

In its circular 08/376 regarding financial information to be submitted by investment companies in risk capital (SICARs), the Luxembourg regulatory authority (Commission de Surveillance du Secteur Financier or CSSF), as competent authority to exercise the supervision within the meaning of article 11(1) of the Law of 15 June 2004 relating to the investment companies in risk capital, as amended or supplemented from time to time (the “SICAR Law”), requires all... Read More

Luxembourg is, behind the USA, the world’s second ranking financial centre for the domicile and servicing of investment funds. Since 1959, when the first fund was established, the investment fund industry hugely expanded, counting 3,457 funds as of 30 September 2009. This success originated with the authorities' encouraging attitude to foreign capital and investment, and was considerably strengthened by its prime location in the heart of Europe - close to the main markets targeted by... Read More

For a long time, Luxembourg hedge funds and funds of hedge funds have been set up under several wrappers, namely funds submitted under part II of the law of 20 December 2002 on UCIs (the “2002” Law) and specialised investment funds (SIF) governed by the law of 13 February 2007 (the “SIF Law”). As of today, hedge fund managers are considering launching UCITS platforms (especially “sophisticated UCITS”). As widely known, UCITS funds are harmonised European... Read More

As part of a legislative package to tackle the financial crisis, the European Commission submitted on 29 April 2009 a Directive on Alternative Investment Fund Managers (“AIFM”) to the European Parliament and to the Council. This proposal emerged rather swiftly following a general consensus across European leaders that AIFM, which managed around EUR 2 trillion in assets at the end of 2008, should be subject to closer regulatory scrutiny.

This proposed Directive marks the... Read More

Luxembourg has long been a significant domicile for private equity vehicles but the jurisdiction has emerged as a major European centre for the industry since the introduction of the Sicar, or risk capital investment company, five years ago. Now a series of changes to the rules governing Sicars that were enacted last year promises to consolidate Luxembourg’s role, even at a time when the private equity industry is battling to adapt to a much-changed economic and financial... Read More