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LU - Clarification of the depositary regime for UCI “Part II” funds

18/01/2018

On 6 February 2018, the Chambre des Députés (Luxembourg Parliament) adopted the draft bill 7024 which, besides implementing EU Regulation 2015/751 on interchange fees for card-based payment transactions, amends the UCI Law of 17 December 2010 (UCI Law) to clarify the depositary regime applicable to Luxembourg Undertakings for Collective Investment (UCIs) that are subject to the Part II of the UCI Law (“Part II funds”).

On 6 February 2018, the Chambre des Députés (Luxembourg Parliament) adopted the draft bill 7024 which, besides implementing EU Regulation 2015/751 on interchange fees for card-based payment transactions, amends the UCI Law of 17 December 2010 (UCI Law) to clarify the depositary regime applicable to Luxembourg Undertakings for Collective Investment (UCIs) that are subject to the Part II of the UCI Law (“Part II funds”). Part II funds are alternative investment funds (AIF) that can be sold to retail investors.

The new text introduces an exception to the depositary regime adopted in 2016: Part II funds that are not marketed to retail investors on the Luxembourg territory and therefore explicitly target professional investors as defined in Article 4 (1) (ag) of the AIFMD will not be subject to the UCITS depositary rules. This must be presented explicitly in the offering documents.