Although perceived as a very safe and conservative country, Luxembourg has embraced innovation in a number of ways that continue to set it apart from many of its competitors.
The days of thinking about single jurisdictions are long gone. When structuring a large private equity fund, for example, it is likely going to contain international investors (the US, Europe, Asia) and is, in effect, a commercial deal between all interested parties to draw down the money. The reality is, different investors have different preferences.
Rather than taking a short-term reactive approach to coping with regulatory change, and the inevitable reporting/data management task that comes with it, asset managers would be best advised to step back and think more long-term.
Luxembourg will always be a very heavily regulated jurisdiction. When the Alternative Investment Fund Managers Directive was introduced in 2011, the Grand Duchy was well prepared in advance of this new post-financial crisis environment of global regulation.
Fuchs Asset Management SA is a family-owned group located in three jurisdictions: Luxembourg, Belgium and Switzerland. It has roughly 160 people and operates five different business lines: wealth management for UHNW individuals, family office services, brokerage of life insurance products, trading execution & support via its dealing desk and third party management company services.
By Jean-Florent Richard (pictured) & Pilar de Terry – Next year sees the introduction of two major pieces of regulation both of which will have implications for how asset managers distribute their investment funds across Europe. Simply put, MiFID II will apply to investment firms manufacturing and/or distributing financial instruments while the PRIIPS regulation applies to all unit-linked funds, structured products and retail investment products.
Unless you've been on Mars for the last 12 months, you will be only too aware of the chaos that has been uncorked following the UK's decision, in June 2016, to leave the European Union.
Following on the tried and tested UCITS experience and further strengthened by AIFMD, the delegation ManCo model has been successfully operated for many years and an entire ecosystem has been built around it, allowing among other benefits significant amounts of capital to be attracted to the EU.
In 2013, at the time the AIFM Directive was introduced, Luxembourg's lawmakers took the opportunity to revamp the two existing limited partnerships with legal personality – the partnership limited by shares (SCA or société en commandite par action) and the common limited partnership (SCS or société en commandite simple).
By Arne Bolch, GSK – On 1 August 2016, the Luxembourg Act on reserved alternative investment funds (RAIF), entered into force. It allowed for the setting up of RAIFs, with their defining feature of indirect supervision by their AIFM rather than direct supervision by the CSSF.