CSSF’s Endless Agenda and More Reviews, More Studies, More Excuses – Luxembourg’s Fund Industry Waits for Action

Luxembourg’s Financial Sector Supervisory Commission (CSSF) has unveiled its 2026 supervisory priorities. The list is long: governance, liquidity, valuation, cyber resilience, sustainable finance, third-party risk, costs and fees, anti-money laundering, and the ever-present threat of geopolitical contagion. On paper, the CSSF is doing everything. But the real question for anyone who has watched Luxembourg’s fund industry over the past decade is simpler: why are so many of these priorities still priorities? The CSSF has been warning about liquidity mismatch since at least 2024. It has been talking about valuation risk for years. And yet, every annual report brings a new list of things the CSSF plans to do better this time. The CSSF has announced that follow-up work on Esma’s Common Supervisory Action regarding internal audit and compliance functions will be a priority in 2026. It also plans to participate in another Common Supervisory Action on risk management functions. In plain English: the CSSF is admitting that it has not been paying enough attention to how fund managers actually run their internal controls. Now, after years of warnings, it will start looking. The CSSF is also launching a study on third-party risk management, examining whether firms comply with Esma’s principles [...]

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