On 14 October 2019, the CSSF published the results of the EMIR questionnaire which was sent to investment fund managers (including but not limited to UCITS ManCos and AIFMs) ("IFM") in August 2018.
The following points from the publication (i.e. CSSF Press Release 19/49) are highlighted:
- - The supervision and oversight of the EMIR obligations by IFMs should be improved, especially when the EMIR obligations are delegated to another entity. In that latter case, IFMs must carry out initial and ongoing due diligence on the delegate to monitor their EMIR obligations appropriately. The arrangements concluded between the IFM and the delegate must clearly establish the roles and responsibilities of each party and ensure an adequate ongoing oversight by the IFM of the EMIR obligations that they have delegated.
- - The lack of formalisation: adequate written procedures and arrangements must be in place to cover the supervision of all EMIR obligations even when a specific obligation does not apply further to the IFM's assessment. IFMs are required to document their assessments and to review on a regular basis the adequacy of their monitoring and oversight procedures.
The CSSF also reminds the IFMs that (i) EMIR applies to derivative contracts concluded for investment purposes as well as for hedging purposes and (ii) registered AIFMs are in scope of EMIR and under the supervision of the CSSF for the compliance with the provisions of EMIR.
The CSSF noticed that in general, the current monitoring and oversight are not compliant with EMIR requirements or with the EMIR requirements provided for by CSSF Circular 18/698, where relevant.
As a next step, the CSSF will assess compliance with the EMIR requirements as well as act to improve the data quality of trades reported to trade repositories.
Finally, the CSSF reminds IFMs that EMIR Refit entered into force on 17 June 2019 and in this context, IFMs must take it into consideration and amend their procedures to comply with all the amendments introduced by EMIR Refit.
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