CSSF updates UCITS and AIFMD FAQs
Data Transfer
On 24 November 2020, the Commission de Surveillance du Secteur Financier (CSSF) published an updated version of its Frequently Asked Questions concerning the Luxembourg Law of 17 December 2010 relating to undertakings for collective investment schemes (the “UCITS FAQ”) and an updated version of its Frequently Asked Questions concerning the Luxembourg Law of 12 July 2013 on alternative investment fund managers (the “AIFM FAQ”).
With this update CSSF introduces in both AIFM FAQ and UCITS FAQ a new question dealing with the conditions to comply with in case of data transfer by a central administration or a depositary to another service provider.
The CSSF clarifies that pursuant to Article 41 (2a) of the amended Law of 5 April 1993 on the financial sector, in case a central administration agent or a depositary is outsourcing services implying a transfer of relevant information to a third party, the central administration agent or the depositary must ensure that its client, the board of directors or managers of the SICAV or of the investment fund manager for common funds, has accepted the outsourcing of the relevant outsourced services, the type of information transmitted in the context of the outsourcing and the country of establishment of the entities that provide the outsourced services.
The CSSF further adds that any transfer of information related to investors should be disclosed prior to the transfer, by the UCI, respectively the investment fund manager for common funds, to investors through appropriate means, namely the prospectus and the application form combined, if appropriate, with a reference to a website. Existing investors should be informed prior to the transfer of their information, about any update of the fund documents aiming at the aforesaid disclosure by means of a letter, email or any other means of communication provided for by the prospectus.
The CSSF finally confirmed that the aforesaid requirements apply independently from the General Data Protection Regulation (EU) 2016/679, if applicable.
Accounting principles for AIFs
On 17 January 2021, the CSSF updated the AIFM FAQ to clarify that authorised AIFMs established in Luxembourg managing Luxembourg AIFs are required to use Lux GAAP or IFRS (as adopted by the European Union by Regulation (EC) No.1606/2002 on the application of international accounting standards) to prepare the annual reports of these AIFs. This requirement is applicable regardless of the AIF’s legal form. AIFMs must use these accounting principles for both regulated and unregulated AIFs.