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Luxembourg Adopts New Financial Sector Legislation: What You Need to Know
The Luxembourg Parliament has finally adopted two long-awaited laws that will significantly impact the country’s financial sector.
Omnibus Law: Clarifying Professional Secrecy and Facilitating Outsourcing
The draft bill 7024, also known as the “Omnibus Law”, amends several rules regarding professional secrecy, facilitates outsourcing, and clarifies the depositary regime of Part II funds. This law is a significant development in Luxembourg’s financial sector, addressing several issues that have been pending resolution.
- Clarification of professional secrecy rules provides greater certainty for financial institutions operating in the country.
- Facilitation of outsourcing allows companies to more easily transfer certain functions to third-party service providers, reducing costs and increasing efficiency for financial institutions.
Anti-Money Laundering Framework Strengthened
The draft bill 7128 implements Directive (EU) 2015/849 on the prevention of the use of the financial system for purposes of money laundering or terrorist financing. This legislation aims to strengthen Luxembourg’s anti-money laundering framework and prevent the misuse of its financial system.
- Requires financial institutions to carry out enhanced due diligence on their customers.
- Implements stricter reporting requirements to prevent money laundering and terrorist financing.
Key Changes
The Omnibus Law clarifies several key issues, including:
- Professional secrecy rules: providing greater certainty for financial institutions operating in Luxembourg.
- Outsourcing: allowing companies to more easily transfer certain functions to third-party service providers.
- Depositary regime of Part II funds: providing greater transparency and stability for investors and fund managers operating in Luxembourg.
The adoption of these two laws marks a significant step forward for Luxembourg’s financial sector, addressing several key issues that have been pending resolution. The changes aim to provide greater certainty, transparency, and stability for financial institutions operating in the country, while also strengthening the country’s anti-money laundering framework.