Luxembourg Financial Regulatory News:
The Commission de Surveillance du Secteur Financier (CSSF) has announced a change to the transmission process for Money Market Fund reporting in Luxembourg (MMF reporting in Luxembourg), effective September 1, 2025. Investment fund managers in Luxembourg will now be required to use a new, streamlined, and free-of-charge system for their MMF submissions. Read more about it at https://ratiofy.lu/cssf-mandates-exclusive-money-market-fund-reporting-method/
Read more about Money Market Funds in Luxembourg (MMF in Luxembourg) at https://www.cssf.lu/en/money-market-funds/
I. Core Concepts and Regulatory Framework under Money Market Fund (MMF) Reporting in Luxembourg
- Regulation (EU) 2017/1131: We can understand the Regulation (EU) 2017/1131 as the foundational European Union regulation governing money market funds (MMFs). In this explanation article at LuxRegDrafts.com, we are looking at it from the perspective of the implementation of Money Market Fund reporting in Luxembourg (MMF reporting in Luxembourg).
- CSSF (Commission de Surveillance du Secteur Financier): This is Luxembourg’s competent authority responsible for overseeing and enforcing Regulation (EU) 2017/1131 within its jurisdiction.
- Money Market Funds (MMFs): The MMF regulation (Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money market funds (“MMFR”)) applies to investment funds established, managed or marketed in the European Union fulfilling the following requirements:
- authorised or having requested authorisation as a UCITS according to Part I of the Law of 17 December 2010 relating to undertakings of collective investment or qualifying as AIFs according to the Law of 12 July 2013 on alternative investment fund managers;
- investing in short-term assets; and
- having distinct or cumulative objectives offering returns in line with money market rates or preserving the value of the investment.
A UCITS or an AIF shall not have characteristics which are substantially similar to those referred to as an MMF, unless it has been authorised as an MMF in accordance with the MMFR.
II. Powers and Responsibilities of the CSSF under Money Market Fund (MMF) Reporting in Luxembourg
For understanding Money Market Fund reporting in Luxembourg (MMF reporting in Luxembourg), it is important to understand the powers and responsibilities of CSSF in this context.
- Supervisory and Investigatory Powers: The CSSF possesses a broad range of powers necessary to effectively monitor and investigate MMFs and their managers.
- Access to Information: The CSSF can access any document or data, request information without delay from MMFs or their managers, and demand information from any related person.
- On-site Inspections: The CSSF has the authority to conduct physical inspections of supervised entities.
- Enforcement Measures: The CSSF can take appropriate measures to ensure ongoing compliance, order compliance, and demand cessation of infringing conduct.
- Referral for Criminal Prosecution: The CSSF can refer information to the State Prosecutor if criminal prosecution is warranted.
III. Administrative Sanctions and Measures under Money Market Fund (MMF) Reporting in Luxembourg
For understanding Money Market Fund reporting in Luxembourg (MMF reporting in Luxembourg), it is important to understand which administrative sanctions and measures could be applied.
- Infringements: The CSSF can impose sanctions for a wide array of infringements specifically enumerated in Regulation (EU) 2017/1131 (e.g., Article 4(1), Article 6, etc.).
- Types of Sanctions: Public statements identifying responsible parties and the nature of the infringement.
- Temporary bans from exercising management functions.
- Administrative fines:
- Up to three times the profits gained or losses avoided.
- For natural persons: up to EUR 1,000,000.
- For legal persons: in the case of a legal person, an administrative fine of up to EUR 5,000,000, or up to 10% of the total annual turnover of that legal person according to the last available accounts approved by the management body. Where the legal person is a parent undertaking or a subsidiary of the parent undertaking which has to prepare consolidated financial accounts in accordance with Directive 2013/34/EU, the relevant total annual turnover shall be the total annual turnover according to the last available consolidated accounts approved by the management body of the ultimate parent undertaking.
- Obstruction and Inaccurate Information: Specific administrative fines (EUR 250 to EUR 250,000) can be imposed for obstructing CSSF powers, failing to follow orders, or providing knowingly inaccurate/incomplete information.
- Factors for Determining Sanctions: The CSSF considers intent/negligence, materiality, gravity, duration, degree of responsibility, financial strength, profits/losses, losses for third parties, cooperation, and previous infringements.
IV. Remedies and Publication of Decisions under Money Market Fund (MMF) Reporting in Luxembourg
For understanding Money Market Fund reporting in Luxembourg (MMF reporting in Luxembourg), it is important to understand which remedies and publication of decisions could be in the scope.
- Right to Appeal: Decisions made by the CSSF can be appealed to the Tribunal administratif (Administrative Tribunal) within one month. Failure to do so results in the case being time-barred.
- Publication of Decisions: The CSSF generally publishes final administrative sanctions or measures on its website without undue delay, including infringement details and identities.
- Exceptions to Publication: Publication may be deferred, anonymized, or withheld entirely if it’s disproportionate, jeopardizes financial market stability, or an ongoing investigation.
- Anonymous Publication: If published anonymously, data can be postponed if reasons for anonymity are expected to cease.
- Retention Period: Published decisions remain accessible for five years; personal data within those publications is retained for a maximum of 12 months.
Glossary of Key Terms
Glossary of key terms for understanding Money Market Fund reporting in Luxembourg (MMF reporting in Luxembourg):
- Regulation (EU) 2017/1131: The European Parliament and Council Regulation of 14 June 2017 on money market funds, serving as the primary legal framework for MMFs in the EU.
- CSSF (Commission de Surveillance du Secteur Financier): The financial sector supervisory authority in Luxembourg, designated as the competent authority responsible for implementing and enforcing Regulation (EU) 2017/1131.
- Money Market Fund (MMF): An investment fund that invests in high-quality, short-term debt instruments, aiming to provide a high degree of liquidity and capital preservation.
- Competent Authority: The public authority legally empowered to exercise specific functions, in this case, the CSSF for MMF regulation in Luxembourg.
- Supervisory Powers: The authority of the CSSF to oversee, monitor, and ensure compliance of regulated entities with the applicable laws and regulations.
- Investigatory Powers: The authority of the CSSF to conduct inquiries, gather evidence, and scrutinize activities of regulated entities to detect potential infringements.
- Administrative Sanctions: Non-criminal penalties or measures imposed by a regulatory body, such as the CSSF, for violations of administrative laws or regulations.
- Public Statement: An administrative sanction involving the public identification of the responsible person and the nature of their infringement, often published by the CSSF.
- Temporary Ban: An administrative sanction that prevents a person from exercising management functions, typically imposed on individuals held responsible for significant infringements.
- Administrative Fine: A monetary penalty imposed by a regulatory authority for a breach of regulations.
- Parent Undertaking: An undertaking that controls one or more subsidiary undertakings.
- Subsidiary Undertaking: An undertaking controlled by a parent undertaking.
- Consolidated Financial Accounts: Financial statements of a group of companies presented as those of a single economic entity, combining the assets, liabilities, equity, income, expenses, and cash flows of a parent company and its subsidiaries.
- Infringement: A violation or breach of a law, regulation, or agreement.
- Disgorgement of Profits: The act of compelling someone who has profited illegally or unethically to give up their ill-gotten gains.
- Tribunal administratif (Administrative Tribunal): A specialized court in Luxembourg that hears appeals and resolves disputes related to administrative decisions, including those made by the CSSF.
- Time-barred: A legal term meaning that a claim or action cannot be brought in court because the statutory period for bringing it has expired.
- Proportionality Assessment: A legal principle requiring that a measure or sanction should be appropriate and not excessive in relation to the objective it seeks to achieve.
- Anonymous Basis: Publishing information without revealing the identity of the individuals or legal persons involved.
- Personal Data: Any information relating to an identified or identifiable natural person.
This news can be considered beneficial under IFMs (AIFMs, ManCos) News, Must Read,
The pre-filled example templates for multiple CSSF Circulars and EU regulations applicable to small to medium sized financial institutions in Luxembourg should be available at https://ratiofy.lu/templates/ from Christmas 2025.
