Luxembourg regulates a broad range of activities, including:

Banking, custody

• Activities of credit institutions ̶ Receiving deposits or other repayable funds from the public and granting credits for their own account; such activity would be considered as an activity of a credit institution. Eligible credit institutions that act as custodian banks holding the underlying assets of Luxembourg life insurance contracts or pension funds require approval from the CAA.
• Providing custody ̶ Safeguarding and settlement of transactions and other related administration in relation to assets that include investments is a regulated activity.

Electronic money and payment services

• Issuing, distributing and redeeming electronic money – Electronic money is a prepaid electronic payment product that can be card- or account-based.
• Carrying on payment services – This covers a broad range of activities involving matters such as money remittance, card issuance, acquiring card transactions and the operation of payment accounts.

Investment and other financial services

• Luxembourg law requires that companies engaged in financial services other than banking, payment or e-money services adopt a regulated status as PFS, of which there are three types:
  • Investment firms – Luxembourg law recognizes 10 different types of investment firms, including companies active in the business of providing financial advice, investment and brokerage services, market making, and the distribution of financial products.
  • Specialized PFS – Specialized PFS are financial professionals that conduct activities outside the scope of investment firms as defined in the European directives. Luxembourg law recognizes 14 different types of specialized PFS, such as corporate domiciliation agents, registrar agents, professional depositaries, Family Offices, and professionals performing securities lending.
  • Support PFS – A support PFS is a company that enters into an outsourcing arrangement with a credit institution, payment institution, investment fund, pension fund, insurance/reinsurance undertaking or another PFS to provide services that require access to confidential data. These services fall under six categories: client communication agents, administrative agents, primary IT systems operators, secondary IT systems, dematerialization service providers and conservation service providers. By virtue of their PFS status, these companies operate under the same regulatory regime as the financial institutions themselves.

     

• Portfolio management, administration and marketing of an undertaking for collective investment (UCI) – All management companies domiciled in Luxembourg, whether UCITS or non-UCITS, must be duly licensed by the CSSF.

Virtual assets services

Following the implementation of the Laws of 25 March 2020 virtual asset service providers (VASPs) have to register with the CSSF in order to provide one or more of the following services: (i) exchange between virtual assets and fiat currencies, including the exchange between virtual currencies and fiat currencies; (ii) exchange between one or more forms of virtual assets; (iii) transfer of virtual assets; (iv) safekeeping and/or administration of virtual assets or instruments enabling control over virtual assets, including custodian wallet services; and (v) participation in and provision of financial services related to an issuer’s offer and/or sale of virtual assets. Once registered, VASPs need to comply with the professional obligations described in the AML/CFT Law.

Insurance

• Conducting direct insurance and reinsurance activities in Luxembourg
• Insurance and reinsurance mediation activities – Luxembourg regulations cover various mediation activities like presenting and proposing (re)insurance contracts, carrying out preparatory works to their conclusion, as well as contributing to the execution of (re)insurance contracts, notably the handling of claims on behalf of the insured.