A statement from CSSF clarifies which entities that are established in Luxembourg and are subject to the CSSF supervision are considered as financial market participants and financial advisers for the purpose of the Sustainable Finance Disclosure Regulation in EU (SFDR or Regulation 2019/2088). The statement also highlights that EC confirmed the application dates of SFDR. As stated in the EC letter dated October 20, 2020, all application dates are being maintained as laid down by the SFDR with effect from 2021; the financial market participants and financial advisers subject to SFDR will need to comply with its high level and principle-based requirements from March 10, 2021, even though the regulatory technical standards, which were initially expected to be available by December 30, 2020, will become applicable at a later stage.
SFDR lays down harmonized rules for financial market participants and financial advisers on transparency with regard to the integration of sustainability risks, the consideration of adverse sustainability impact in their processes, and the provision of sustainability‐related information with respect to financial products. As clarified in the CSSF statement, financial market participants include alternative investment fund managers (AIFMs), Undertakings for Collective Investment in Transferable Securities (UCITS) management companies, managers of a qualifying venture capital fund or a qualifying social entrepreneurship fund, credit institutions and investment firms that provide portfolio management, and institutions for occupational retirement provision (IORPs). Additionally, financial advisers include credit institutions, investment firms, AIFMs, and UCITS management companies that provide investment advice. EC believes that, even without the full regulatory technical standards, there are no impediments to financial market participants and financial advisers complying with the Level 1 requirements laid down in the SFDR.
Keywords: Europe, Luxembourg, Banking, Insurance, Securities, ESG Regulation 2019/2088, SFDR, Disclosures, Climate Change Risk, Sustainable Finance, ESAs, EC, CSSF
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
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