Consumer Protection / Conduct in Luxembourg

What Changed

• - CSSF Circular 21/783, which applied ESMA’s Guidelines on MiFID II/MiFIR obligations on market data in Luxembourg, will cease to be applicable as of 23 August 2026 and is formally classified as...
• The supervisory reference framework for market data obligations in Luxembourg shifts from ESMA soft-law Guidelines to binding regulatory technical standards contained in Commission Delegated...
• Requirements on making market data available to the public on a “reasonable commercial basis” are now set out in directly applicable EU law, including detailed RTS criteria on cost-based pricing,...
• ESMA’s interpretative role via Guidelines is replaced by binding RTS, which reduces reliance on national circulars and increases harmonisation of market data rules across EU trading venues and data...
• Luxembourg firms can no longer rely on Circular 21/783 as the primary interpretative document for market data obligations; instead, their compliance frameworks must directly reference Delegated...

Suggested Considerations

• Identify and catalogue all internal policies, procedures, contractual templates, and pricing frameworks that reference CSSF Circular 21/783 or ESMA’s MiFID II/MiFIR market data Guidelines.
• Review Commission Delegated Regulation (EU) 2025/1156 in detail and map its RTS requirements (e.g. cost-based pricing, non-discriminatory access, data unbundling, publication formats) against current market data practices.
• Update market data pricing policies to ensure that fees are demonstrably based on reasonable commercial basis criteria defined in Delegated Regulation (EU) 2025/1156, including documentation of cost allocation and margin methodology.
• Revise market data access policies and client terms to ensure non‑discriminatory conditions and appropriate unbundling of pre‑trade and post‑trade data, in line with the RTS.
• Amend compliance manuals, MiFID/MiFIR control frameworks, and training materials to remove references to CSSF Circular 21/783 and ESMA Guidelines, replacing them with references to Delegated Regulation (EU) 2025/1156.

Key Dates

References

• [1] cssf.lu/wp-content/uploads/cssf21_783eng.pdf
• [2] cssf.lu/wp-content/uploads/cssf21_790_eng.pdf
• [3] cssf.lu/wp-content/uploads/cssf21_782eng.pdf
• [4] pwc.lu/en/newsletter/2026/cssf-circular-25-901.html
• [5] dechert.com/knowledge/onpoint/2024/4/new-cssf-circular-on...

What Changed

• Because the visible page content provided is limited to technical and cookie‑related information, the key points below focus on the regulatory substance of the CSSF MiFID II/MiFIR FAQ (Q&A) as the...
• The CSSF confirms the application of MiFID II investor protection rules to Luxembourg investment service providers, including obligations on inducements, suitability, product governance, and best...
• The FAQ reiterates that investment services providers must inform clients clearly whether their investment advice or services are provided on an independent or non‑independent basis, and explains the...
• The FAQ clarifies that inducements are expressly prohibited when investment advice is provided on an independent basis and for portfolio management services, requiring firms to structure their...
• The CSSF guidance reflects product governance obligations: manufacturers must define a target market for each financial instrument based on clients’ knowledge and experience, financial situation,...

Suggested Considerations

• Review the latest CSSF MiFID II/MiFIR FAQ (13 July 2026 version) in full, comparing it against existing internal MiFID II/MiFIR policies, procedures, and controls to identify gaps or misalignments.
• Confirm and, where necessary, update client‑facing disclosures to clearly state whether investment services (especially advice and portfolio management) are provided on an independent or non‑independent basis, and ensure that inducement arrangements are consistent with this classification.
• Reassess inducement frameworks (commissions, fees, non‑monetary benefits) for investment advice and portfolio management to ensure that no prohibited inducements are received or retained where services are independent or involve portfolio management.
• Review and update product governance frameworks, including target market definition processes and product approval procedures, to ensure that each instrument’s intended target market is properly documented and consistently used by distributors.
• Examine best execution policies to confirm they are clear, detailed, and understandable to clients, and implement or enhance ongoing monitoring mechanisms (e.g. execution quality reports, periodic reviews) to evidence compliance with best execution obligations.

Key Dates

References

• [1] cssf.lu/wp-content/uploads/QA-MiFIDII_MiFIR.pdf
• [2] cssf.lu/en/Document/cssf-faq-mifid-ii-mifir/
• [3] cssf.lu/en/mifid-ii-priips/
• [4] cssf.lu/fr/mifid-ii-priips/
• [5] nortonrosefulbright.com/en/knowledge/publications/494a828...
• [6] esma.europa.eu/sites/default/files/library/esma35-43-349_...

What Changed

• At this stage, based on the CSSF notice alone, no new legal or regulatory requirements are introduced; the publication is a transparency notice that a sanction decision exists.
• the Law of 5 April 1993 on the financial sector (LFS), the Law of 17 December 2010 on undertakings for collective investment, the Law of 12 July 2013 on AIFMs, and the Law of 12 November 2004 on the...
• the CSSF’s established practice of publishing individual sanction decisions, which typically detail shortcomings in organisational requirements, internal controls, oversight of delegates, conduct of...
• the legal provisions breached (for example, Articles 109–111 and 148 of the Law of 2010 or Articles 2-2, 3 and 8-4 of the AML/CFT Law, by analogy with other CSSF sanctions),
• the factual deficiencies identified (e.g., weaknesses in governance, delegate oversight, AML risk assessment, customer due diligence), and

Suggested Considerations

• Monitor the CSSF website for publication of the detailed PDF decision relating to the administrative sanction of 5 March 2026 against Stonehage Fleming Luxembourg S.A.
• Once available, review the full decision to identify the specific legal bases (e.g. LFS, Law of 2010, Law of 2013, AML/CFT Law) and control failures cited by the CSSF.
• Map the identified weaknesses from the decision against your firm’s governance, internal control, delegate oversight and AML/CFT frameworks to identify any similar risk areas.
• Update internal compliance risk assessments to reflect the enforcement themes highlighted in this and recent CSSF sanctions, including the weighting of enforcement risk for organisational and AML/CFT deficiencies.
• Review and, where necessary, strengthen board and senior management oversight arrangements, including the documentation of decisions, challenge and escalation processes, in anticipation of CSSF expectations evidenced in the forthcoming decision.

Key Dates

References

• [1] cssf.lu/wp-content/uploads/S_70_GFI_Zeus_Asset_Management...
• [2] cssf.lu/wp-content/uploads/S_71_GFI_abrdn_Investments_Lux...
• [3] cssf.lu/wp-content/uploads/S_88_GFI_Allianz_Global_Invest...
• [4] cssf.lu/en/market-abuse/
• [5] cliffordchance.com/content/dam/cliffordchance/PDFDocument...
• [6] assets.kpmg.com/content/dam/kpmg/pdf/2014/09/aifmd-transp...
• [7] cssf.lu/en/wp-sitemap-posts-document-2.xml
• [8] cssf.lu/en/wp-sitemap-posts-post-1.xml

What Changed

• - The CSSF publishes a dedicated Feedback Report on the thematic review of valuation frameworks for less liquid and illiquid assets and formally expects IFMs to use it as guidance for implementing...
• All Luxembourg IFMs are required to conduct a benchmarking exercise of their valuation frameworks against the CSSF’s observations and recommendations set out in the new Feedback Report.
• Where gaps or weaknesses are identified through this benchmarking, IFMs are expected to implement corrective measures to strengthen their valuation policies, procedures and lifecycle controls for...
• The thematic review scope formally covers AIFMs of AIFs investing in less liquid and illiquid assets (including private equity, real estate, infrastructure, private debt and fund of funds), and, on...
• The CSSF explicitly links this thematic work to previous supervisory exercises (ESMA CSA on valuation, CSSF self‑assessment questionnaires, and on‑site inspection feedback) and consolidates...

Suggested Considerations

• Perform a structured benchmarking of existing valuation policies, procedures, methodologies and controls against the detailed observations and recommendations in the CSSF Feedback Report on valuation frameworks for less liquid and illiquid assets.
• Document, at IFM and fund level, all identified gaps or weaknesses in the current valuation framework, including for AIFs in illiquid strategies and UCITS Article 41(2) trash ratio positions.
• Develop and approve a remediation plan with clear owners, milestones and target dates to address identified shortcomings in valuation governance, methodologies, model validation, data sources and control processes.
• Review and, where necessary, update valuation policies and procedures to ensure they explicitly cover less liquid and illiquid assets, stressed market conditions, use of external valuers, and documentation standards across the investment lifecycle.
• Enhance valuation governance by clearly defining roles and responsibilities (including segregation from portfolio management where applicable), escalation procedures, and oversight by the board/senior management.

Key Dates

References

• [1] elvingerhoss.lu/publications/cssf-feedback-report-esma-cs...
• [2] ey.com/en_lu/insights/wealth-asset-management/cssf-spotli...
• [3] cssf.lu/en/2023/07/cssf-feedback-report-on-esma-common-su...
• [4] cssf.lu/wp-content/uploads/ESMA_CSA_valuation_CSSF_Feedba...
• [5] esma.europa.eu/sites/default/files/2023-05/ESMA34-45-1802...
• [6] cssf.lu/en/investment-fund-industry-studies/
• [7] iosco.org/library/pubdocs/pdf/IOSCOPD721.pdf
• [8] fsb.org/uploads/P270224.pdf

What Changed

• - The amending Delegated Regulation updates the list of data fields required for the classification of prospectuses under Delegated Regulation (EU) 2019/979, impacting how issuers and their advisors...
• The RTS amendment revises the list of information that can be incorporated by reference into a prospectus, narrowing or clarifying which external documents (e.g.
• Prospectus classification data fields are expected to better align with current ESMA Prospectus Register needs (for example finer product type, offer type, and home/host state metadata), requiring...
• The updated incorporation-by-reference list seeks to ensure that only readily accessible and reliable information may be referenced, which will affect how issuers structure cross‑references to annual...
• National competent authorities, including the CSSF, will apply the revised RTS when reviewing and approving prospectuses and supplements, meaning filings that use outdated data sets or ineligible...

Suggested Considerations

• Map all existing prospectus templates, checklists and workflows against the revised Delegated Regulation (EU) 2019/979 data fields and immediately identify gaps in prospectus classification data and reference documentation.
• Update internal prospectus data dictionaries and metadata schemas so that all new and updated prospectuses capture the full revised list of ESMA classification data required by the amended RTS.
• Review and revise the firm’s incorporation‑by‑reference policy, including standard clauses and cross‑reference tables, to ensure only information categories permitted under the updated RTS are incorporated by reference.
• Reconfigure electronic filing tools and interfaces used for submissions to the CSSF (and other NCAs) so that they generate and transmit the updated RTS data set required for classification and ESMA register purposes.
• Train legal, capital markets, and product teams involved in prospectus drafting on the new RTS requirements, including examples of acceptable and non‑acceptable incorporation‑by‑reference documents.

Key Dates

References

• [1] financialcrime.lu/services/policies-procedures/
• [2] data.consilium.europa.eu/doc/document/ST-8450-2026-INIT/e...
• [3] dechert.com/knowledge/onpoint/2022/12/luxembourg-s-cssf-s...
• [4] cssf.lu/en/Document/commission-delegated-regulation-eu-20...
• [5] cssf.lu/en/Document/commission-delegated-regulation-eu-20...
• [6] cssf.lu/en/Document/council-implementing-regulation-eu-20...
• [7] caceis.com/regwatch/october-2022/
• [8] cssf.lu/en/reporting-to-be-submitted-by-ucis/

What Changed

• - Adoption of ESMA Guidelines: CSSF mandates application of ESMA's criteria for evaluating staff knowledge and competence in crypto-asset services, including roles in custody, trading, portfolio...
• Assessment Framework: Firms must implement standardized tests and processes to verify staff qualifications, aligning with MiCA Article 62 on CASP authorization, focusing on technical crypto...
• No New Standalone Rules: This circular builds on prior CSSF MiCA circulars (e.g., 25/890 on crypto-asset classification), integrating competence checks into licensing dossiers and ongoing supervision.

Suggested Considerations

• Assess Staff Competence: Implement ESMA-guided evaluations (e.g., exams, certifications) for all relevant personnel handling crypto services; document results in governance frameworks.
• Update Policies and Training: Integrate competence criteria into HR, onboarding, and annual reviews; roll out MiCA-specific training on reporting, breaches, and governance.
• Licensing Dossier Enhancement: Include competence attestations in CSSF applications; appoint dedicated compliance/risk officers with verified qualifications.
• Ongoing Monitoring: Conduct regular audits, penetration tests, and incident planning; confirm compliance annually via management body statements.
• Early CSSF Engagement: Schedule dialogues and info sessions; create MiCA readiness scorecards for board and regulator discussions.

Key Dates

References

• [1] copla.com/blog/compliance-regulations/mica-regulation-in-...
• [2] cssf.lu/wp-content/uploads/cssf25_890eng.pdf
• [3] cssf.lu/en/markets-in-crypto-assets-mica-micar/
• [4] loyensloeff.com/insights/news--events/news/circular-cssf-...
• [5] cssf.lu/en/Document/circular-cssf-25-890/
• [6] cliffordchance.com/content/dam/cliffordchance/PDFDocument...
• [7] cssf.lu/en/2023/07/regulation-on-markets-in-crypto-assets...
• [8] dechert.com/knowledge/onpoint/2023/1/initiatives-to-regul...

What Changed

• The most recent update (March 9, 2026) to the Technical FAQ reflects the regulatory framework established by CSSF Regulation No 20-08 (as modified by Regulation No 24-10).
• First-time buyers: LTV limit of up to 100%
• Other buyers: LTV limit of 90%, implemented via portfolio allowance Buy-to-Let Residential Loans:
• Standard LTV limit of 80%
• Temporary exemption (until June 30, 2025): Lenders may apply LTV ratios up to 95% for up to 10% of annual production Other Residential Real Estate Loans:

Suggested Considerations

• *For all lenders:
• *Verify LTV compliance calculations for all new residential mortgage originations using the framework specified in the FAQ, ensuring own funds are calculated as actual equity contributions from borrowers
• *Implement dual LTV tracking for borrowers financing new property through sale of existing property, ensuring compliance with both interim and final LTV ratios
• *Document own funds sources carefully, particularly when cash collateral or sale proceeds are used, as these are only permitted for loans with initial LTV below 100%
• *Prepare for June 30, 2025 transition by:

Key Dates

References

• [1] cssf.lu/wp-content/uploads/Technical_FAQ_on_Regulation_CS...
• [2] cssf.lu/en/Document/cssf-regulation-no-20-08-of-3-decembe...
• [3] bsp.lu/lu/publications/newsletters-newsflashes/consumer-c...
• [4] cssf.lu/en/Document/technical-faq-on-cssf-regulation-no-2...
• [5] esrb.europa.eu/pub/pdf/other/esrb.notification20201218_LT...
• [6] cssf.lu/wp-content/uploads/cssf25_899eng.pdf
• [7] simmons-simmons.com/en/publications/ckiyunxuz1ba50a686os8...
• [8] pwc.lu/en/press/press-articles-2024/fighting-real-estate-...

What Changed

• No new regulatory changes or requirements are introduced; this is an enforcement action applying existing rules.
• Failure to cooperate with CSSF requests, e.g., not submitting required AML/CFT questionnaires by deadlines, violating Article 5(1) of the amended Law of 12 November 2004 on AML/CFT.
• Non-compliance with investment policies, organizational requirements, or conduct rules under the UCI Law (e.g., Articles 41, 43, 109), including improper broker exposures or valuation failures.
• These reflect ongoing enforcement of established frameworks like the AIFM Law, UCI Law, and AML/CFT Law, with fines calibrated by factors like breach duration, firm size, cooperation level, and prior...

Suggested Considerations

• Enhance cooperation protocols: Implement automated tracking for CSSF requests (e.g., questionnaires) with escalations for reminders; document all responses.
• Review investment compliance: Audit broker exposures, valuation processes, and subscription/redemption controls against UCI Law Articles 41-43, 109; suspend dealings if uncertainties arise.
• Strengthen governance: Conduct gap analyses on internal controls, risk assessments, and reporting for depositary/oversight functions per AIFM Law Article 19(9) and CDR 231/2013.
• Training and monitoring: Roll out firm-wide training on AML/CFT obligations (Article 5(1)) and perform reconciliations of assets/records; prepare for on-site/off-site CSSF inspections.
• Self-reporting: Proactively disclose prior breaches to mitigate fine severity.

Key Dates

References

• [1] cssf.lu/wp-content/uploads/S_95_GFIA_Max-Gain-Capital-S.a...
• [2] cssf.lu/wp-content/uploads/S_90_GFI_Zeus_Asset_Management...
• [3] cssf.lu/wp-content/uploads/S_46_B_X_100125_en.pdf
• [4] cssf.lu/en/Document/administrative-sanction-of-15-october...
• [5] cssf.lu/en/international-financial-sanctions/
• [6] cssf.lu/wp-content/uploads/FAQ_International_financial_sa...
• [7] cssf.lu/wp-content/uploads/2025-AML-CFT-conference-dedica...

What Changed

• The original Circular CSSF 08/356 (2008) transposed UCITS III requirements on eligible techniques like securities lending and repos.
• Expanded collateral rules: Collateral must now include sustainable assets meeting SFDR criteria, with daily marking-to-market and haircuts adjusted for liquidity and credit risk (Section 3).
• Counterparty exposure limits: Net exposure to a single OTC counterparty capped at 10% of net asset value (NAV), down from previous thresholds in some cases, with mandatory collateralization (Section...
• Operational safeguards: Mandatory use of triparty agents for repos, enhanced segregation of collateral, and annual stress testing disclosures (Section 5, as amended).
• Reporting enhancements: Quarterly reports to CSSF on transaction volumes, risks, and revenues from these activities (Annex 1, updated). These align with ESMA guidelines (e.g., ESMA/2012/832 on OTC...

Suggested Considerations

• *Policy Review & Update: Revise fund prospectuses, KIIDs, and risk management policies to reflect amended limits (e.g., counterparty caps, ESG collateral) within 3 months of 01 January 2026.
• *Risk Management Systems: Implement or upgrade systems for daily collateral valuation, stress testing, and exposure monitoring; conduct gap analysis against Section 4 requirements.
• *Counterparty Due Diligence: Reassess OTC counterparties for eligibility (e.g., EMIR clearing thresholds); negotiate ISDA/CSA agreements with updated haircuts.
• *Operational Setup: Appoint triparty agents where required; ensure collateral segregation complies with Section 5.
• *Reporting & Disclosure: Prepare for new quarterly CSSF filings (template in Annex 1); disclose revenues/reinvestments from techniques in annual reports (Article 14 UCITS Law).

Key Dates