Publication of the Luxembourg Law of 21 July 2023 modernising Luxembourg funds toolbox

Introduction

Bill of Law No. 8183 (the “Law”) has been approved by the Luxembourg Parliament and published on 24 July 2023, with effect as of 28 July 2023.

The Law amends:

Law of 15 June 2004 relating to the investment company in risk capital (“SICAR”), as amended (the “SICAR Law”);

1. Law of 13 February 2007 relating to specialised investment funds (“SIF”), as amended (the “SIF Law”);
2. Law of 17 December 2010 relating to undertakings for collective investment (“UCITS”), as amended (the “UCITS Law”);
3. Law of 12 July 2013 on alternative investment fund managers (“AIFM”), as amended (the “AIFM Law”),
4. Law of 23 July 2016 on reserved alternative investment funds (“RAIF”), as amended (the “RAIF Law”).

Objective

The Law’s primary objectives are to improve and modernise Luxembourg’s fund toolbox and increase the attractiveness and competitiveness of the Luxembourg financial centre.

Key changes to note:

Some of the most important changes include:

• Harmonisation of the “well-informed investor” definition in the SIF, SICAR and RAIF Law by (i) cross-referring to “professional investors” as defined under MIFID II, (ii) lowering the investment threshold from EUR 125,000 to EUR 100,000 and (iii) aligning the list of entities that may certify the experience of other investors.
• Increase to 24 months of the time limit by which the subscribed capital must reach the legal minimum for SICARs, SIFs and RAIFs. For Part II funds, the time limit increases to 12 months.
• Simplification of formation formalities where a RAIF is set up by virtue of articles of association and clarification that marketing RAIFs to “well-informed investors” in Luxembourg is permitted.
• Specification that authorised AIFMs may have recourse to tied agents, as defined under Financial sector law of 1993, as amended.

How can Zeidler Group assist:

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