Laws and Regulations

The European Securities and Markets Authority (Esma), the EU’s financial markets regulator, has fined the European rating agency Scope 2.2 million euro for breaches of the Credit Rating Agencies (CRA) Regulation. The penalty is for Scope’s failure to manage conflicts of interest adequately, involving both structural and specific non-compliance issues.

Approvals of new European Long-Term Investment Funds in Luxembourg are proceeding smoothly, despite the relays with the adoption of regulatory standards for the second generation of these funds, the CSSF’s supervisor in charge of investment funds, Marco Zwick, told the Alfi conference on Tuesday.

The EU’s retail investment package will come up for a vote at the Parliament’s Committee on Economic and Monetary Affairs on the evening of Wednesday, 20 March.

Eurozone finance ministers have put forth a five-year blueprint to forge a robust Capital Markets Union (CMU) in what they see as an “ambitious” move to enhance private capital flow into Europe and underpin Europe’s costly shift to a sustainable and digital economy. 

Amidst heightened regulatory scrutiny, Luxembourg’s private investment fund landscape experiences a transformative shift in valuation paradigms, a panel discussion on Wednesday made clear.

Brussels has opted to abandon the proposed establishment of a ‘European passport’ for depositary banks. While initially touted as an innovative concept, the idea was fraught with potential market challenges and risked undermining the work of supervisors. The alternative approach that has emerged now is being hailed as a success by Luxembourg banking association ABBL. 

Luxembourg’s financial regulator CSSF has updated its guidance for the crypto investment landscape, clarifying that only ‘well-informed investors’ within alternative investment funds can tread into the virtual asset territory.

The Securities and Exchange Commission (SEC) is about to scrap the requirement for Scope-3 reporting. In doing so, the US stock market watchdog is driving a wedge between US legislation and the new European rules from the Corporate Sustainability Reporting Directive, or CSRD that will apply from next year.

The new European directive mandating corporate social responsibility for large companies has been blocked by the European Council as yet. Germany, Italy and France last week withdrew their support for the proposal they had agreed to as recently as December.

Luxembourg’s lawmakers are making strides in proposals aimed at alleviating the tax burden on actively managed Exchange Traded Funds (ETFs), aligning their fiscal treatment with that of standard passive ETFs, a senior industry voice made clear on Tuesday.