Luxembourg: SFDR updates and the CSSF's fast track procedure

In brief

Adopted as part of the European Commission's action plan of March 2018 on financing sustainable growth, Regulation (EU) 2019/2088 of 27 November 2019 on sustainability-related disclosures in the financial services sector (SFDR) seeks to harmonize rules particularly on disclosures to investors in relation to sustainability-related disclosures. 

On 16 December 2020, the 'Commission de Surveillance du Secteur Financier' (CSSF) issued a communication in relation to SFDR (Communication) stating that a fast track procedure would be implemented to facilitate the submission of updated prospectuses/issuing documents to the CSSF.

For who in the Luxembourg fund industry is the Communication and the fast track procedure relevant?

  • Alternative investment funds managers (AIFMs) for each  alternative investment fund (AIF) they manage under the form of SIFs and Part II UCIs;
  • UCITS management companies for each Luxembourg UCITS they manage and
  • Luxembourg  investment companies which have not designated a management company


SFDR transparency requirements

1) In fund documents 

As per Article 6 SFDR, AIFMs, UCITS management companies and investment companies authorized in accordance with the UCITS Directive which have not designated a management company authorized under the UCITS Directive for its management (IFMs) will need to disclose how sustainability risks (i.e. an environmental, social or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of an investment) are integrated in their investment decisions as well as assess and disclose what the likely impact of such risks could be on the returns of a given fund. The sustainability risk assessment approach and related disclosures feed into UCITS prospectuses/AIF offering documents. 

Where the IFM's sustainability risk assessment leads to the conclusion that there are no sustainability risks deemed to be relevant for a given fund, the reasons should be explained in UCITS prospectuses/AIF offering documents.

IFMs are further required to put in place adequate disclosures in UCITS prospectuses/AIF offering documents, in relation to Article 7(2) SFDR when such IFMs do not consider adverse impacts of investment decisions on sustainability factors for a given fund.

A prior categorization of the fund will have to be carried out in light of:

  • Article 8 SFDR: i.e. funds promoting among other characteristics, environmental or social characteristics, or a combination of those characteristics - provided the investee companies follow good governance practices) or
  • Article 9 SFDR: i.e. funds having sustainable investment as their objective and an index has been designated as a reference benchmark.

The UCITS prospectuses/AIF offering documents of such funds may also need to be modified. Related disclosures, including the fund name, should not mislead end-investors by excessively disclosing on the way in which sustainability is given effect in the investment policy of a given fund.

2) In IFM documents 

The integration of sustainability risks must also be ensured at the level of the IFM risk management policy.

IFMs should also assess their compliance with the requirements related to the publication of information on the websites and to the update of policies and processes related to sustainability risks. Adequate measures must be taken in case of gaps. 

The related disclosures relate mainly to the sustainability risk policies, how sustainability risks are integrated in the investment decision-making process, the adverse sustainability impacts as described under Article 4 SFDR and the remuneration policies. 

What does the CSSF fast track procedure entail?

Updates must be limited to reflect changes required under SFDR. This fast track procedure is therefore not available where material changes are being made.

The updated prospectus/issuing document of a CSSF regulated fund shall be filed for visa stamping with a letter - in the form available on the CSSF's website - confirming under the ultimate responsibility of the IFM/fund the prospectus/issuing document update as well as the upgrade of the IFM's policies/processes (Confirmation Letter).

The Confirmation Letter shall be duly signed by at least one representative of either the UCITS management company, the investment company which has not designated a management company, the AIFM or the legal advisor or another representative of the IFM/fund.

The professional duly appointed to submit the updated prospectus/issuing document version for visa stamping must upload the document in clean version via the e-file/Sofie channel together with the Confirmation Letter and merged with the updated prospectus/issuing document in track change version. Where foreseen, the notice to inform investors on prospectus/issuing document update shall also be uploaded and submitted as a letter.

Upon satisfactory acceptance by the CSSF, the prospectus/issuing document will be visa stamped and returned through the e-file/Sofie channel. Unsatisfactory filing will result in the return of a notice though e-file/Sofie requesting the filing of a new revised prospectus/issuing document version.


The CSSF refers to its Communiqué of 6 November 2020 and re-iterates that all application dates under SFDR are maintained. IFMs will need to comply with the high-level principle-based requirements as laid down in the SFDR by 10 March 2021 where this is required under SFDR. 

The fast track procedure opened on 16 December 2020. UCITS management companies and AIFMs have until 28 February 2021 to submit updated UCITS prospectuses, and SIF and Part II UCIs prospectuses/issuing documents respectively (including all the requested disclosures) to the CSSF.


How can we help? 

Baker McKenzie Luxembourg is a law firm engaging in compliance actions and assists asset managers in fulfilling their compliance duties by practical advices, legal recommendations and  regulatory filings.

Copyright © 2023 Baker & McKenzie. All rights reserved. Ownership: This documentation and content (Content) is a proprietary resource owned exclusively by Baker McKenzie (meaning Baker & McKenzie International and its member firms). The Content is protected under international copyright conventions. Use of this Content does not of itself create a contractual relationship, nor any attorney/client relationship, between Baker McKenzie and any person. Non-reliance and exclusion: All Content is for informational purposes only and may not reflect the most current legal and regulatory developments. All summaries of the laws, regulations and practice are subject to change. The Content is not offered as legal or professional advice for any specific matter. It is not intended to be a substitute for reference to (and compliance with) the detailed provisions of applicable laws, rules, regulations or forms. Legal advice should always be sought before taking any action or refraining from taking any action based on any Content. Baker McKenzie and the editors and the contributing authors do not guarantee the accuracy of the Content and expressly disclaim any and all liability to any person in respect of the consequences of anything done or permitted to be done or omitted to be done wholly or partly in reliance upon the whole or any part of the Content. The Content may contain links to external websites and external websites may link to the Content. Baker McKenzie is not responsible for the content or operation of any such external sites and disclaims all liability, howsoever occurring, in respect of the content or operation of any such external websites. Attorney Advertising: This Content may qualify as “Attorney Advertising” requiring notice in some jurisdictions. To the extent that this Content may qualify as Attorney Advertising, PRIOR RESULTS DO NOT GUARANTEE A SIMILAR OUTCOME. Reproduction: Reproduction of reasonable portions of the Content is permitted provided that (i) such reproductions are made available free of charge and for non-commercial purposes, (ii) such reproductions are properly attributed to Baker McKenzie, (iii) the portion of the Content being reproduced is not altered or made available in a manner that modifies the Content or presents the Content being reproduced in a false light and (iv) notice is made to the disclaimers included on the Content. The permission to re-copy does not allow for incorporation of any substantial portion of the Content in any work or publication, whether in hard copy, electronic or any other form or for commercial purposes.