Luxembourg publishes law on cross-border distribution of funds

With the law of 21 July 2021 (the “Law”) Luxembourg implements the Directive (EU) 2019/1160 of the European Parliament on cross-border distribution of collective investment undertakings (the “CBD”).

The primary objective of the CBD is to facilitate EU cross-border distribution of undertakings for collective investment in transferable securities (“UCITS”) and alternative investment funds (“AIFs”) and harmonize the regulatory framework governing the distribution of such investment funds.

Key elements

The Law introduces several key elements regarding distribution such as the so-called pre-marketing regime, the requirement to provide local facilities for AIFS and UCITS marketed to retail investors, and the marketing de-notification process of AIFs and UCITS.

Entry into force

The Law will enter into force on 2 August 2021. It amends the law of 17 December 2010 on undertakings for collective investment, as amended, and the law of 12 July 2013 on alternative investment fund managers, as amended and affects all UCITS and AIFs.

Please also read our article on the cross-border directive available here.