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Net assets managed by investment funds under Luxembourg law reached €2,615.4 billion at the end of December 2013, compared to €2,383 billion at the end of 2012. Commenting on the past year, Marc Saluzzi, Chairman of ALFI, said: “2013 was positive, but there are challenges ahead for the sector. For example, whilst the Alternative Investment Fund Managers Directive (AIFMD) has finally been implemented, and despite positive developments in the negotiations on FATCA, the regulatory agenda remains a heavy burden. The proposed Financial Transaction Tax (FTT), the draft regulation on money market funds and the final agreement on MiFID II could have a severe negative impact on the European asset management industry.”
On FATCA, ALFI confirmed that the Model 1 Intergovernmental Agreement between Luxembourg and the US is to be signed soon. On AIFMD, ALFI reports that, six months after the implementation of the Directive, the effect of the new regulation is beginning to take shape. In Luxembourg some 90 alternative investment fund managers have applied to the CSSF for approval under the new regulations. At this point, 12 companies are listed on the official CSSF list of AIFM, whilst six others have received approval and are finalizing the paperwork.
“Total Assets under management in alternative funds in Luxembourg is currently around €500 billion and ALFI’s objective is to double these assets within five years", says Saluzzi. “Our comprehensive range of investment vehicles will help achieve this.”
In this context, two developments are of particular interest:
Mr Saluzzi concludes: “Whilst initial results on AIFMD are very encouraging, we need to wait until at least the end of July 2014 to see Luxembourg’s role in this sector".