CSSF publishes two important texts on the provision of investment services in Luxembourg by third country firms


On 2 July 2020, the Commission de Surveillance du Secteur Financier (the “CSSF”) published two important texts for third country firms providing investment services or the carrying out of activities and ancillary services in Luxembourg:

  • CSSF regulation n°20-02 (the “Regulation”); and
  • CSSF circular letter n°20/743 (the “Circular”).

The Circular

The Circular amends the existing CSSF circular letter 19/716 on the provision in Luxembourg of investment services or performance of investment activities and ancillary services in accordance with Article 32-1 of the amended law of 5 April 1993 on the financial sector (the “LFS”).

More specifically, the Circular details the criteria under which the provision of investment services by third country firms is considered to be provided in Luxembourg under Article 32-1 (1) second paragraph of the LFS:

  • the third country firm is established in Luxembourg; or
  • the third country firm provides an investment service to a retail client established or located in Luxembourg; or
  • the place for the provision of the characteristic performance of the service is Luxembourg.

Pursuant to the above, a third country firm may fall outside the scope of application of Article 32-1 (1) second paragraph of the LFS where, even though services are provided to a client established or located in Luxembourg (apart from retail clients), the service may be considered as not being provided in Luxembourg.

The above described amendment, effective as of 1 July 2020, opens slightly the door to third country firms which may be most welcome for undertakings established in the United Kingdom in the current Brexit context.

The Regulation

The Regulation in turn provides for a list of countries that are considered by the CSSF as having equivalent supervisory and authorization rules as those set out under the LFS for the purpose of Article 32-1(1) second paragraph of the LFS.

The following six jurisdictions are deemed equivalent:

  • Canada
  • Switzerland
  • United States of America
  • Japan
  • Hong Kong
  • Singapore

The Circular and the Regulation are accessible under the following links (only in French for now):

  • CSSF Circular n° 20/743: https://www.cssf.lu/wp-content/uploads/cssf20_743.pdf
  • CSSF Regulation 20-02: http://data.legilux.public.lu/file/eli-etat-leg-rcsf-2020-06-29-a563-jo-fr-pdf.pdf.

For any questions regarding the above, please do not hesitate to contact our specialists.