Australian institutional investors get easier access to Luxembourg UCITS

AFS (Australian financial services) licence relief has been granted by the Australian Securities and Investments Commission (ASIC) for financial service providers regulated by the Luxembourg financial supervisory authority Commission de Surveillance du Secteur Financier (CSSF) to provide financial services in Australia to wholesale investors.

This relief enables Australian institutional investors, including superannuation funds, easier access to Luxembourg UCITS.

With more than EUR 2,400 billion in net assets under management, Luxembourg is the largest investment fund centre in Europe and the second largest in the world after the US. It leads the crossborder market in Europe, with 72% of cross-border distribution of investment funds.

Under the exemption, Luxembourg’s regulator regime was deemed ‘sufficiently equivalent’ to the Australian regulatory regime to allow licence relief for CSSF regulated Chapter 15 Management Companies and UCITS Self-Managed SICAV.

UCITS stands for Undertakings for Collective Investment in Transferable Securities. The concept provides a single regulatory regime across the European Union for open-ended funds investing in transferable securities such as shares and bonds. The Directive regulates the organisation, management and oversight of such funds, and imposes rules concerning diversification, liquidity and use of leverage.

The development reflects the growing interest in Luxembourg to do business with Australian institutional players.

More information

ASIC issued a Relief Instrument on 16 November 2016 setting out the conditions of the AFS licensing relief (see link below).

To learn more about how FundBPO can support the administration of your funds in Australia or Europe, contact us.

Further reading

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This article is not intended to be financial advice and is of a general nature only that does not take into account your individual objectives, financial situation or needs. While all efforts have been made to ensure the information contained in this article is accurate, errors may occur.

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