The Luxembourg Financial Supervisory Authority (CSSF) and European Securities and Markets Authority (ESMA) have published Covid-19-related communications.
26 March 2020: Procedure for complaint handling
In light of the Covid-19 outbreak, instead of sending the complaints by regular email or using the online complaint form, any new complaints as well as any communication concerning complaints already registered with the CSSF, must be sent by e-mail to firstname.lastname@example.org.
25 March 2020: Long form reports
On an exceptional basis, the long form report may be remitted within four months of the annual general meeting (AGM) of the fund (UCITS and Part II UCIs) approving the audited accounts, excluding delays for such AGMs granted by the government through exceptional measures. Both delays will not be applied cumulatively. Where the submission can be performed within the ordinary deadlines without compromising the quality of the audit work, a timely submission is encouraged.
23 March 2020: Regulatory reporting
The CSSF has indicated that regulatory reporting deadlines should be respected. However, supervised entities should contact the CSSF if they are experiencing difficulties in preparing or validating their reporting due to operational reasons (e.g. staff working remotely unable to access the systems). The CSSF has indicated that its strict enforcement policy would not be applied for delays that are justified.
22 March 2020: Immediate review of current organisational setups
The CSSF urged all supervised entities to immediately review their current organisational setup so that the least possible number of staff members have to travel to, and work from, their usual workplace or backup site. This should be limited to only safeguarding the vital functions that are essential to maintain the critical operations of supervised entities, which cannot be performed remotely. Moreover, staff should be enabled and equipped to work remotely.
20 March 2020: ESMA clarifies its position on recording of calls under MiFID II
Considering the exceptional circumstances created by the COVID-19, if firms are unable to record voice communications, ESMA expects them to consider alternative steps to mitigate the risks related to the lack of recording.
20 March 2020: Update of the FAQ on the swing pricing mechanism
A basis point adjustment, known as the swing factor, is applied to adjust the NAV per share up where there are net inflows, or down in the case where there are net outflows. Due to market conditions, the CSSF has updated its FAQ on swing pricing mechanism to include the following clarifications.
UCIs (UCITS, UCI Part II & SIFs) can increase the swing factor to be applied on the NAV, up to the maximum level laid down in the prospectus, without prior notification to the CSSF.
An increase of the swing factor beyond the maximum level laid down in the prospectus is possible:
- if the board of directors or the management company is authorised in the prospectus to make the adjustment; or
- only on temporary basis by board of directors or the management company, when such possibility is not offered to them in the prospectus.
The increase of the swing factor must be duly justified and take into account the best interest of the investors.
For a swing factor adjustment beyond the maximum level set out in the prospectus, on a temporary basis, (i) the revised swing factors should be the result of a robust internal governance process and are based on a robust methodology, and (ii) an appropriate communication must be made to investors through the usual communication channels. The CSSF can ask the UCI to justify on an "ex post basis" the level of the swing factor applied. In such case, the UCI needs to provide the CSSF with documents evidencing that the factors applied were representative of the prevailing market conditions.
16 March 2020: Certificate for cross-border workers living in Germany
Germany’s Federal Police has provided a certificate which may be used by an employee living in Germany in order to prove the working relationship with an employer in Luxembourg. The certificate can be placed behind the windscreen in a clearly visible position. At the same time, the form provided by the Luxembourg government on 15 March remains valid and will continue to be accepted by the German Federal Police.
12 March 2020: The CSSF takes its responsibility in the context of Coronavirus
In the face of Covid-19 pandemic, the CSSF will focus its interventions on key items to preserve financial stability and to protect investors and consumers. The CSSF will help the professional of the financial sector by publishing press releases and questions and answers which are updated when necessary.
2 March 2020: Clarification from the CSSF regarding the conduct to adopt by supervised entities
To ensure the continuity of their activities in the event of a crisis, prior authorisation by the CSSF is not required for professionals to activate their business continuity plans and use other facilities in or outside the Grand Duchy of Luxembourg, if any.
CSSF’s Covid-19-related communications can be found here.
ESMA’s public statement can be found here.