On December 22, 2021, the CSSF issued guidelines for the fund industry regarding the new external report on anti-money laundering and financing of terrorism measures that must be drawn up by an external expert.

To whom does the circular apply, and who is exempt?

According to the circular, all Luxembourg investment fund managers, including registered alternative fund managers and Luxembourg funds supervised by the CSSF for AML/CFT purposes, must provide the external report. It is not required from Luxembourg funds that have appointed a fund manager, whether established in Luxembourg or abroad. In these cases, the external auditor of the funds must nevertheless perform an AML assessment as prescribed by Article 49 (1) of CSSF Regulation No 12-02 of December 12, 2012 on combating money laundering and the financing of terrorist financing.

Who should draft the report?

All investment fund managers required to appoint an approved statutory auditor (réviseur d’entreprises agrée / REA) to audit their annual accounts shall designate the same REA to prepare the external report.

The registered AIFMs, which do not have the legal requirement to appoint a REA for the audit of their annual accounts, must appoint an REA for the specific purpose of preparing the AML/CFT external report.

What should the report contain?

The report is divided into two sections. The first concern the corroboration of answers given by the AIFMs as part of the CSSF annual AML/CFT online survey. The second deals with sample testing or specific work to be performed by the external expert.

Who should submit the report to the CSSF, when and how?

The report must be submitted to the CSSF via the eDesk platform within six months of the closing of the annual accounts. This should be carried out by the Responsable du Contrôle du respect des obligations professionnelles en matière de lutte contre le blanchiment et contre le financement du terrorisme (compliance officer, or RC); the Responsable du Respect des obligations professionnelles en matière de lutte contre le blanchiment d’argent et contre le financement du terrorisme (RR); or a member of the board of directors, or equivalent.

When does the circular come into force?

Luxembourg funds and managers must comply with the provisions of the circular for the financial years ending on or after December 31, 2021. For the financial year ending on December 31, 2021, an extension of three extra months is granted for the submission, up to the end of September 2022.

CSSF circular 21/788 is available here.

For more information, please get in touch with our investment management team.