Update of the CSSF FAQ concerning the Luxembourg Law of 17 December 2010 to provide clarifications regarding portfolio transparency for actively managed ETFs

The CSSF has published today an update of its FAQ concerning the Luxembourg Law of 17 December 2010 relating to undertakings for collective investment.

This update introduces a new question (12.1) providing specific guidance on the portfolio transparency requirements for actively managed UCITS ETFs.

The CSSF acknowledges that market makers (“MMs”) and authorised participants (“APs”) need frequent information on portfolio holdings to ensure an efficient arbitrage mechanism and an active secondary market for ETFs.

In addition, IFMs have to publish the detailed portfolio holdings of actively managed UCITS ETFs they manage. In order to protect their proprietary information and to prevent other market participants from being able to replicate their investment strategy, the CSSF recognises that IFMs may choose to publish portfolio holdings at a lower frequency than for MMs/APs.

Against this backdrop, the updated FAQ specifies the portfolio transparency requirements for actively managed UCITS ETFs, thereby differentiating between MMs/APs and the investors in these ETFs.