NautaDutilh Avocats Luxembourg Sàrl updates

PSD 2 implementation in the Grand Duchy
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 23 November 2018

By way of the Law of 20 July 2018, Luxembourg has finally implemented the EU Payment Services Directive (PSD 2). As the PSD 2 is a full harmonisation directive, most of Luxembourg's PSD 2 provisions are identical to the legal framework implemented across the European Union. Nonetheless, EU member states were given scope to decide on certain topics and the Grand Duchy seized the opportunity to define its own rules.

EAPOs: new pro-creditor enforcement mechanism under Luxembourg law
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 20 July 2018

EU Regulation 655/2014, which established a European Account Preservation Order (EAPO) procedure, aims to facilitate the collection of claims in civil and commercial matters by introducing a uniform EU procedure for identifying and freezing funds held in a debtor's bank accounts in another member state. This increased transparency is a particularly new development for Luxembourg, which recently introduced a straightforward EAPO enforcement procedure that is in line with its existing enforcement measures.

Enforcement of Luxembourg pledge: key takeaways from recent court decision
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 20 April 2018

A recent Luxembourg District Court judgment has confirmed the well-established, flexible and creditor-friendly environment offered by the Collateral Act. The court ruled that the enforcement of a pledge cannot be set aside, except in the case of clearly established fraud. The main takeaway from the decision is the confirmation of the possibility offered by the act to enforce a pledge without any payment default and in case of a breach of a financial covenant.

Recent measures to facilitate restructuring and prevent insolvency
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 23 June 2017

Luxembourg recently adopted a number of legislative reforms aimed at modernising the rules applicable to commercial companies, including a number of reforms which could affect their restructuring and insolvency. Although the main purpose of these changes is to modernise the rules applicable to commercial companies and the relevant publication formalities, they may also prove useful in the framework of corporate restructuring and the prevention of insolvency.

New financial regulatory framework for outsourcing and specific rules for cloud services
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 09 June 2017

The Luxembourg financial sector regulator (CSSF) recently published a number of circulars in order to streamline its regulation of IT outsourcing in the financial sector and introduce specific rules for the use of cloud services. In doing so, the CSSF has defined the conditions under which financial service providers may outsource activities without infringing the regulatory principles of central administration and sound governance.

EAPOs in Luxembourg: a further erosion of bank secrecy?
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 27 January 2017

EU Regulation 655/2014 recently became fully applicable, making it possible for creditors in Luxembourg to obtain a preservation order for the bank accounts of a debtor situated in another EU member state and vice versa. The regulation introduces a certain degree of transparency at the EU level with regard to debtors' assets, which is greater than that provided under existing Luxembourg law.

Modernisation of Company Law: new act recognises simplified winding-up procedure
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 04 November 2016

Following the recent enactment of the act modernising the Company Law 1915, Luxembourg law now officially recognises the possibility for companies to be wound up by means of a simplified procedure. Although a simplified procedure had previously existed in notarial practice, it lacked a clear legal basis. The new procedure is an unquestionably useful tool which will further enhance Luxembourg's business-friendly reputation.

CSSF publishes FAQs on criteria for accepting external experts as internal auditors
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 29 July 2016

The Luxembourg financial sector regulator (CSSF) recently published frequently asked questions clarifying the criteria that it considers when assessing whether to accept an external expert as a regulated entity's internal auditor. The CSSF also confirmed that the criteria are assessed proportionately, and that it may request further information or interview the relevant parties when determining whether outsourcing an internal audit is possible.

CSSF provides guidance on dormant accounts
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 15 April 2016

The Luxembourg financial sector regulator has issued Circular 15/631, which provides guidance on the definition and treatment of dormant accounts. According to the circular, professionals should maintain regular contact with their clients and monitor client relationships with vigilance. They must also set out rules to determine clearly when a relationship has become inactive and when an account has become dormant.

New bill aims to modernise bankruptcy legislation
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 30 October 2015

The number of companies declared bankrupt in Luxembourg has increased tremendously since 2009, mainly due to the existing legislation, which is obsolete and no longer suited to modern financial challenges. As such, a bill has been introduced to provide customised tools to help distressed companies to continue their activities and protect stakeholders, notably by favouring restructuring over liquidation.

New approval procedures for key function holders in credit institutions
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 22 May 2015

Persons exercising key functions in credit institutions are now subject to specific approval by the Luxembourg financial regulator, the Commission de Surveillance du Secteur Financier (CSSF). The CSSF recently published guidelines on the new prudential approval procedure, which applies to directors, authorised managers and persons in charge of internal control functions.

Latest bitcoin developments
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 18 July 2014

The proliferation of bitcoin users goes hand in hand with the emergence of operators providing bitcoin-related services – enabling, for instance, the exchange of bitcoins for conventional official currencies. In the absence of EU legislation to curb the risks of bitcoin use, the Luxembourg financial regulator has clarified the way in which it intends to deal with bitcoin-related service operators.

New right to reclaim data from bankrupt cloud computing providers
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 28 June 2013

The Chamber of Deputies recently voted in favour of a law introducing a right to claim back intangible and non-fungible movable assets from a bankrupt company. The law provides greater certainty as to the consequences of the bankruptcy of a cloud services provider regarding the data that it holds, and contributes significantly to Luxembourg's strong reputation as a centre of excellence for IT outsourcing.

Proposal for right to reclaim data from bankrupt cloud computing providers
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 09 November 2012

A bill has been introduced to Parliament that provides for a right to reclaim intangible and non-fungible movable assets from a bankrupt company. The bill is intended to allow for the recovery of data from a bankrupt provider of distance IT services or cloud computing solutions. The law will provide greater certainty as to the consequences of the bankruptcy of a cloud computing provider for the data in its possession.

Insolvency protection of creditors and collateral takers
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 25 November 2011

Recent legislation has amended the Collateral Act. The act has always been a lender-friendly implementation of the EU Collateral Directive and, in general, it remains favourable to creditors in insolvency situations and other contexts. However, all stakeholders should be aware of the insolvency aspects of collateral arrangements.

Insolvency protection of creditors and collateral takers
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 25 November 2011

Recent legislation has amended the Collateral Act. The act has always been a lender-friendly implementation of the EU Collateral Directive and, in general, it remains favourable to creditors in insolvency situations and other contexts. However, all stakeholders should be aware of the insolvency aspects of collateral arrangements, as well as the other mechanisms available for insolvency protection.

Creditor-friendly changes to Collateral Act
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 20 May 2011

Parliament has passed a new law which amends the Collateral Act. It seeks to enhance the legal security of the creditor's position when taking collateral, and to ensure that such collatoral is effective and bankruptcy-remote. Among many other measures, it introduces two new means of perfecting pledges over financial assets.

Proportionality principle for banks' remuneration requirements
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 21 April 2011

Excessive risk taking, incentivised by inappropriate remuneration policies, has led to the failure of many institutions. Luxembourg's financial regulator has addressed the issue with circulars that implement the EU Third Capital Requirements Directive. They explain how the proportionality principle applies to remuneration policies and when institutions may disapply certain remuneration obligations.

Overview (October 2010)
NautaDutilh Avocats Luxembourg Sàrl
  • Insolvency & Restructuring
  • Luxembourg
  • 29 October 2010

Including: Initiating bankruptcy; Directors' liability; Consequences; Suspect period; Effects on employment contracts; Preferred claims.

Financial regulator tightens requirements on remuneration policies
NautaDutilh Avocats Luxembourg Sàrl
  • Banking
  • Luxembourg
  • 04 June 2010

The Supervisory Authority of the Financial Sector has implemented the European Commission's recommendation on remuneration policies in the financial sector. The regulator's circular on the subject affects members of a bank's administration and management bodies, as well as certain categories of employee whose professional activities have a material impact on the bank's risks.

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