LUXEMBOURG: UCITS FAQ – NAV Calculation Error and Correction

Thursday July 30 2020

On 28^th July 2020, the Commission de Surveillance du Secteur Financier (CSSF) published the updated FAQ regarding Circular CSSF 02/77 – List of questions/answers in relation to the provisions of Circular CSSF 02/77 concerning the protection of investors in case of NAV calculation error and correction of the consequences resulting from non-compliance with the investment rules applicable to undertakings for collective investment.

Q: Should a UCITS that exceeds the level of leverage as disclosed to investors in the fund prospectus in accordance with box 24 of the CESR guidelines on Risk Measurement and the Calculation of Global Exposure and Counterparty Risk for UCITS (CESR-10/788 dated 28/07/2010) for UCITS, respectively should a regulated AIF that exceeds the leverage limits as disclosed to investors in accordance with Article 21 (1) (a) of the Law of 12 July 2013 , notify such situation to the CSSF in the context of the provisions of Circular CSSF 02/77?

A: No. However, the CSSF expects that such a breach is adequately monitored and corrected in accordance with applicable internal procedures (escalation, etc.)

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