Brexit Update: Mandatory CSSF Notification

  1. Mandatory CSSF Brexit notifications

    As indicated in our Newsletter - May 2019, two Brexit Laws1 were adopted in April 2019 in Luxembourg.

    The Brexit Laws aim to address certain potential consequences of a situation whereby the UK leaves the EU in an uncoordinated manner on 31 October 2019, i.e. without concluding a withdrawal agreement based on Article 50(2) of the Treaty on the EU ("Hard Brexit").

    These laws notably granted the CSSF the right to provide for a transitional regime, which would apply to firms providing management, investment and/or more general financial services in Luxembourg.

    Indeed, in the case of a Hard Brexit, these firms will become "third-country entities" for the application of the EU legislation and they will lose the benefits derived from passporting rights provided for under the relevant EU Directives as from the date of the Hard Brexit.

    On 15 July 2019, the CSSF published two press releases advising UK firms to take the necessary steps to benefit from the transitional regime provided in the Brexit Laws.

    - CSSF Press Release 19/34 targets undertakings for collective investment ("UCIs") and alternative investment fund managers ("AIFMs")/UCITS management companies ("UCITS ManCos") established in the UK that are currently providing services in Luxembourg under a valid EU passport; - CSSF Press Release 19/33 details the regime that will apply to firms that are currently authorised under CRD2, MiFID II3, PSD 24 or EMD5 in the UK ("UK Investment and Finance Firms"). 2. UCIs and their managers in the context of Brexit

    According to CSSF Press Release 19/34 and 19/43, all affected entities were required to notify the CSSF by 15 September 2019 of their intention and way forward to continue to provide services in Luxembourg in the case of a Hard Brexit through a dedicated notification portal, the eDesk Portal.

    The targeted entities are firms licensed under the AIFM or the UCITS Directive and/or the related regulated Luxembourg AIFs that are currently providing services in Luxembourg under a valid EU passport and that are planning to continue to provide services under the relevant passports of the AIFM or the UCITS Directive.

    In addition, by 31 October 2019 at the latest, these entities must submit to the CSSF:

    - the corresponding application for authorisation or, as the case may be, - the corresponding notification or information on any action taken otherwise, depending on the nature of the activities they intend to pursue...

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