AML/CFT

On 26 May 2025, the CSSF updated its FAQ related to the completion of the AML/CFT Market Entry Form concerning Fund and IFM on the eDesk platform. Two new questions have been added concerning the market entry form for European Long-Term Investment Funds and de minimis AIFMs.

The CSSF clarified that the “Market entry OTHER LU AIF (ELTIF)-notification update” must exclusively be used for Luxembourg AIFs (other than Part II UCIs, SIFs, or SICARs) authorised as European Long-Term Investment Funds, when notifying the CSSF of changes to board members, responsable du respect des obligations (also known as “RR”), or responsable du contrôle du respect des obligations (also known as “RC”), with supporting documents attached and a notification email sent.

Further, it has been confirmed that AIFMs registered under Article 3(2) of the AIFM Law only need to submit the market entry form at initial registration, with additional updates required only upon CSSF request, noting, however, that any substantial amendment or update must be notified to the CSSF.

On 7 April 2025, the CSSF issued circular 25/878, incorporating into Luxembourg law the European bank association (EBA) guidelines on money laundering and terrorist financing (ML/TF) risk factors (EBA/GL/2024/01).

The Circular is applicable with immediate effect to credit and financial institutions subject to Article 1(3) and (3a) of the Luxembourg AML/CFT Law, including in particular CASPs. The Circular introduces:

• specific risk factors for crypto-asset activities;
• tailored guidance customer due diligence and risk mitigation for crypto-related services;
• guidance for CASPs in evaluating ML/TF risks relationships;
• mitigating measures for CASPs in high and lower ML/TF risk scenarios.

On 6 June 2025, the Association of the Luxembourg Fund Industry (ALFI) published its response to the European Banking Authority’s (EBA) consultation on draft RTS concerning the methodology for selecting obliged entities to be directly supervised by the future Anti-Money Laundering Authority (AMLA). ALFI's response generally upholds the objective of promoting AML/CFT monitoring across the EU, but it also states multiple concerns concerning the RTS.

Particularly, ALFI highlighted the necessity of a risk-based approach that considers the investment fund sector's characteristics. It advises that the draft, if adopted, could result in unnecessary administrative burdens, significant additional costs, undermine competitiveness, and even risk financial exclusion, without necessarily improving risk mitigation. ALFI even stated certain concerns over the RTS on the lack of transparency in AMLA's weighting of risk indicators. It further encourages that criteria for direct AMLA supervision be improved, proposing two thresholds, which would be cumulative rather than alternative and which would ultimately limit the number of entities meant to be assessed by AMLA.

Overall, ALFI’s response aims to ensure that the new supervisory standards are both effective and proportionate, supporting a clear AML/CFT oversight without imposing unnecessary burdens on the fund industry.