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CSSF reminds Investment Mangers to declare performance fee models

High Water Mark On 4 April 2022 the CSSF issued a reminder for Investment Fund Managers to declare the performance fee models applicable to Luxembourg UCITS or AIF they manage. The original notice by the CSSF from 22 September is based on ESMA guidelines.

Declarations have to be made using the eDesk portal. Closing dates for filing for each fund are available on the eDesk dashboard.

Who has to make the declaration for performance fee model?

As per eDesk the following (sub)Funds and/or managers have to complete the declaration:

  • any Luxembourg-based UCITS; and
 
  • any Luxembourg-based regulated AIF:
    • authorised as an internally managed alternative investment fund (within the meaning of point (b) of article 4(1) of the amended law of 12 July 2013 on alternative investment fund managers (the “AIFM Law”); or
    • managed by an AIFM authorised pursuant to Chapter 2 of the AIFM Law and established in Luxembourg; or
    • managed by an AIFM authorised pursuant to Chapter II of AIFMD established in another EU Member State.
 
  • unregulated AIFs managed by AIFMs established in Luxembourg and authorised pursuant to Chapter 2 of the AIFM Law
 

ESMA guidelines indicate the following (sub)Funds to be out-of-scope:

  • closed-ended AIFs; and
  • open-ended AIFs that are EuVECAs (or other types of venture capital AIFs), EuSEFs, private equity AIFs or real estate AIFs.
 

To determine in or out-of-scope a self-assessment form is available on eDesk.

Comments/observations

  • If the AIFM is not based in EU this requirement does not apply.

This seems a strange gap which we don’t know how long it will exit. Phoenix will notify non-EU clients when this changes. 

  • All (sub)Funds (active, approved but not active yet, inactive and awaiting reactivation) have to make the declaration.

This seems to become the norm with the CSSF. Even a (sub)Fund that does not have any performance fee option, must declare this through the portal.

  • Any changes made to declared performance fee models have to be reported to the CSSF through eDesk as well.

 

Actions

  • Managers need to make sure they (or their administrator) completes / has completed the self-assessment.
  • If in-scope Mangers have to make sure they (or their administrator) completes the declaration.
  • Managers and (sub)Funds that are in-scope need to include steps to their update process for offering documents to ensure timely trigger of new declarations in case of changes to performance fee models.

Internal Links

External Links

The above is a summary, for the full text please refer to the links below: