On 10 June 2022, Luxembourg’s Commission de Surveillance du Secteur Financier (CSSF) published updated frequent asked questions (FAQ) on the regulated société d’investissement en capital à risque (SICAR), a specialised investment company whose exclusive purpose is to invest in risk capital.

Among other FAQs the list includes, answers to questions on:

• What steps are to be taken to submit an authorisation request for a new SICAR?
• What are the CSSF's requirements regarding the prospectus of SICARs?
• Which requirements regarding prudential reporting does the SICAR have to comply with?
• Can SICARs make indirect investments through intermediary investment vehicles or special purpose vehicles?
• What are the SICARs' obligations with respect to risk management?
• What requirements are the SICARs subject to regarding management of conflicts of interest?
• Which general characteristics shall investment policies of SICARs present? With a focus on the development concept of the targeted investment, difference between a SICAR and a holding company (exit v holding), listed investments and when real estate could be held indirectly.

Practical guidance is provided on what should be provided as part of the CSSF authorisation process to demonstrate compliance with the principle of investing in Risk Capital (which has been outlined in CSSF circular 06/241).

Additionally, helpful guidance is furnished on the obligation to perform due diligence on the underlying investment.

CSSF’s FAQs can be found here.