Wednesday May 13 2020
News Source: Fund Regulation
Focus: Liquidity Risk Management
On 10 March 2020, the CSSF implemented a specific monitoring of the largest investment fund managers (“IFM”) in view of the specific circumstances and risks to which these companies were exposed to as a result of the prevailing market conditions. Since then, these IFMs have had to notify the CSSF of significant developments and issues as well as on related decisions and measures taken by IFMs.
The information collected serves the CSSF to perform its daily supervision and as a basis to support discussions with other authorities and with market players to identify issues at an early stage and to assist with the resolution of these.
At this juncture, the CSSF further extends the scope of the exercise to a wider number of IFMs and integrates the related notification process into its eDesk portal.
All IFMs concerned by the notification on fund issues and/or large redemptions (hereafter “IFM Notification”) have been contacted by the CSSF.
An IFM Notification has to be transmitted to the CSSF via eDesk only if the following events occur:
- significant events/issues affecting the functioning of the investment funds managed by the IFM;
- larger redemptions at the level of Luxembourg regulated investment funds (UCITS, Part II UCI, SIF) managed by the IFM (i.e. daily net redemptions exceeding 5% of the NAV, net redemptions over a calendar week exceeding 15% of the NAV and/or application of gates/ deferred redemptions).
Further details on the IFM Notification, the scope of application and additional explanations assisting IFMs in filling in the notification are outlined in the dedicated section of the CSSF eDesk portal homepage:
In order to give IFMs sufficient time to prepare, the IFM Notification applies as from 2 June 2020.
The existing monitoring of significant developments and issues as well as on the related decisions and measures taken by IFMs, which was established on 10 March 2020, is repealed and replaced by the new IFM Notification as of that date.
The IFM Notification remains in place until further notice by the CSSF.
In this context, the CSSF wants to inform the industry that the reporting “Early Warning on large redemptions”, which is only relevant for a limited number of UCITS that have, in the past, been contacted directly by the CSSF, is suspended until further notice.
In order to support IFMs and to ensure a secured exchange platform, the response notification shall be submitted by the IFM via the CSSF eDesk portal. For that purpose, the IFM must have an eDesk account with a LuxTrust authentication.
Click on the above link for further information.