Introduction
Deadline reminder
Filing pre-contractual documents and periodic reports
Comment


Introduction

On 27 July 2022, the Luxembourg financial regulator (CSSF) released a communication on the regulatory requirements arising from:

  • EU Regulation 2019/2088 of 27 November 2019 on sustainability-related disclosures in the financial services sector (SFDR); and
  • EU Commission Delegated Regulation 2022/1288 of 6 April 2022 on regulatory technical standards (SFDR RTS).

The communication indicates a deadline for certain updates to pre-contractual information and periodic disclosures for undertakings of collective investment in transferable securities (UCITSs), alternative investment funds (AIFs) and fund managers (AIFMs and UCITS management companies) to submit the required updates to prospectuses and issuing documents by 1 January 2023. This is in accordance with the provisions of the SFDR RTS and the Taxonomy Regulation, namely EU Regulation 2020/852 of 18 June 2020 on the establishment of a framework to facilitate sustainable investment.

Deadline reminder

For AIFs and UCITSs subject to articles 8 and 9 of the SFDR, the CSSF recently reminded SFDR RTS fund managers to file pre-contractual information and periodic disclosures by 1 January 2023, using the templates found in the annexes to the SFDR RTS. They should also ensure that this information is displayed online, in a dedicated website section entitled "sustainability-related disclosures". In addition, the CSSF notes that, for such AIFs or UCITSs, the Taxonomy Regulation requires fund managers to provide pre-contractual documents and periodic reports on the environmental objectives referred to in article 9 of the Taxonomy Regulation by 1 January 2023.

Filing pre-contractual documents and periodic reports

The CSSF imposes specific requirements for the filing of pre-contractual documents and requires fund managers to submit updates to it no later than 31 October 2022. In this regard, the CSSF distinguishes between UCITSs and AIFs. For UCITSs, an updated prospectus, which only includes changes to sustainability-related disclosures, must be filed by 31 October 2022, along with the RTS confirmation letter. The CSSF will shortly provide a template for this letter, as an update to the communication. AIFs that are obliged or that intend to publish pre-contractual disclosures in an annex to their issuing document or prospectus, pursuant to article 6(3) of the SFDR, must submit the issuing document or prospectus to the CSSF no later than 31 October 2022.

The updated pre-contractual documents shall be filed electronically with the CSSF, in accordance with the provisions set out in the CSSF Circular 19/708 on the electronic submission of documents to the CSSF.

For visa-stamping purposes, the CSSF will give priority to updates to issuing documents or prospectuses of UCITSs or AIFs that are limited to changes to sustainability-related disclosures. If a document submitted in accordance with the filing procedure set out above is complete, compliant and received by the CSSF by 31 October 2022, the CSSF will strive to have it stamped by 31 December 2022.

In its communication, the CSSF further points out that the annual reports of UCITSs and AIFs issued from 1 January 2023 onwards (regardless of whether the AIF is managed by a registered or authorised AIFM) must comply with the product disclosure requirements laid down in article 11 of the SFDR and further clarified by the SFDR RTS, using the mandatory templates. The CSSF also notes that Luxembourg-domiciled UCITS management companies and authorised AIFMs must ensure that the annual reports of managed UCITSs and AIFs domiciled in jurisdictions other than Luxembourg meet the periodic disclosure requirements laid down in the SFDR and the SFDR RTS. These annual reports must be filed electronically with the CSSF.

Comment

This communication provides additional guidance on both pre-contractual documents and periodic reports. In particular, the CSSF expects to receive a dedicated pre-contractual information and periodic disclosure template for each sub-fund or compartment. These templates should not be modified, except as provided for by article 2 of the SFDR RTS (ie, the size and font type of characters and the colours). If a fund manager deems certain sections of the template irrelevant to a given fund, sub-fund or compartment, the manager should mark them as inapplicable to the given fund, sub-fund or compartment, without removing them from the template. The CSSF expects fund managers to submit the required pre-contractual information and periodic disclosures using only the dedicated templates, with the exception of disclosure items required by the SFDR that are not already included.

For further information on this topic please contact Luc Courtois or Salvatore Pugliese at NautaDutilh Avocats Luxembourg by telephone (+352 26 12 29 1) or email ([email protected] or [email protected]). The NautaDutilh Avocats Luxembourg website can be accessed at www.nautadutilh.com.