• Gabrielle Jaminon, Director |
3 min read

At almost 20 years old, the current long form is no longer adapted to today’s fund landscape. Why? Some fund types were not in the scope of the requirement, so investment fund managers did not need to prepare a long form–even though they play an important role in the fund ecosystem. In addition, the long-form data was not in a format that allows efficient processing.

On 22 December 2021, the CSSF issued new circulars introducing the long-form reform that will help overcome these shortcomings and modernize the approach.

Enlarged scope of long-form application

The current long form (applicable to UCITS and Part II funds only) will be replaced by:

  1. A separate report for Luxembourg investment fund managers that will be applicable to:
    • Management companies subject to Chapter 15 of the 2010 Law
    • AIFMs subject to the 2013 Law
    • Self-managed UCITs
    • Self-managed AIFs with AuM above the thresholds set out in article 3 (2) of the AIFM Law
  2. A separate report for investment funds applicable to all Luxembourg regulated funds:
    • UCITS
    • Part II funds
    • SIFs
    • SICARs
  3. An AML/CFT external report applicable to the following Luxembourg entities:
    • Management companies subject to Chapter 15 of the 2010 Law
    • Management companies subject to Chapter 16 of the 2010 Law
    • AIFMs subject to the 2013 Law
    • Luxembourg branches of foreign investment fund managers
    • SIAG and FIAAG
    • Registered AIFMs (in a simplified version)

A modernized approach to Luxembourg’s long forms

The approach will be based on the use of various questionnaires.

Investment fund managers and funds will be required to fill in self-assessment questionnaires (SAQ) that the CSSF will provide electronically via eDesk. Besides the existing AML questionnaire, a second questionnaire will be addressed to IFMs with questions on their compliance with the requirements of circular 18/698.

The auditor will be required to perform work on some specific questions of the self-assessment questionnaires and report in the separate report (that will also take the form of a questionnaire available electronically via eDesk).

Long-form application timeline for IFMs

The circulars on the IFM separate report and on the AML/CFT external report will apply starting from the periods or years ending 31 December 2021.

The IFM separate report must be submitted seven months after the year end. IFMs will benefit from an extended timeline of nine months after year end for the submission related to the 31 December 2021 year end. The IFM’s SAQ must be submitted three months before those deadlines.

Concerning the AML/CFT external report, the submission is due six months after the year end and an additional three months is granted in relation to the 31 December 2021 year end.

Long-form applicable timeline for funds

The fund separate report will become applicable starting from the periods or years ending on 30 June 2022 for UCITS and Part II funds and from periods or years ending on 30 June 2023 for SIFs and SICARs. The long form report in its current format and content will still be applicable for the upcoming year ends up to 31 May 2022.

The deadline for final submission of the fund separate report will be five months after the year end for UCITS and Part II funds and six months after the year end for SIFs and SICARs. Funds’ SAQs must be submitted two months before those deadlines.

How can IFMs best prepare for this long-form change from CSSF?

IFMs should start preparing for the exercise by asking themselves, “How confident am I in terms of my company’s compliance to the requirements of Circular 18/698 and AML requirements? Wouldn’t it be the right time to take a closer look?”

Since 2018, perspectives on the practical application of the requirements of Circular 18/698 have evolved. There is more knowledge in the market about the dos and don’ts, as well as the expectations of the regulator. Reviewing your company’s level of compliance early will help identify weaknesses and set the plan to remediate when required.

A similar approach for the AML legislation may be valuable to confirm compliance with the most recent developments.

Don’t forget the operational implications of this change. A strong project plan will ensure that the questionnaires can be prepared in time. To start, you might consider the following:

  • Personnel availability for report preparation
  • Data access rights
  • Processes to collect the necessary internal and external data
  • Allocation of responsibilities
  • Validation processes

KPMG expertise

Have any questions? Or need help navigating the new long form? Just reach out to our team of experts at KPMG Luxembourg!