The Commission de Surveillance du Secteur Financier (“CSSF”) issued on February 20, 2014 an updated version of the frequently asked questions (“FAQ”) relating to the Luxembourg Law of July 12, 2013 on alternative investment fund managers (the “AIFM Law”).
Such update concerns the valuation of AIF’s assets, in particular when it is performed by an external valuer. Pursuant to article 17(4)(a) of the AIFM Law, an external valuer “must be a legal person independent from the AIF, the AIFM and any other persons with close links to the AIF or the AIFM.” The external valuer could therefore be (i) the depositary, (ii) the administrator or (iii) any other third party that fulfills this independent condition. For the first two exemptions following should be taken into account, too:
- The external valuer may be the depositary only if the performance of the depositary functions are functionally and hierarchically separated from those of the external valuer and any possible conflicts of interest are identified, managed, monitored and disclosed to the investors of the AIF.
- The external valuer may be the administrator if it provides tailor-made valuations for individual assets and complies with the provisions of article 17(4) and 17(5) of the AIFM Law.
In any case, the appointment of an external valuer has to be formalised by a written contract between the parties clearly stating that the “third party” is appointed as an external valuer in the sense of the AIFM Law and which sets out its tasks.
For more detailed information, please feel free to consult the updated version of the FAQ issued by the CSSF.
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