A Luxembourg Common Investment Fund (FCP) is Reserved Alternative Investment Fund with no legal personality. By rule, it is an unregulated vehicle directly managed by a Luxembourg management firm.
Investors of the Luxembourg Common Investment Fund
The investors in a Luxembourg Common Fund subscribes for units which represent only a portion of the common fund. Provisions in the effective management of a Luxembourg Common Investment Fund (FCP) are found in its Articles of Association. All pertinent decisions made within the Common Investment Fund (FCP) is facilitated by an investment manager on behalf of its investors.
With company formation expertise spanning years, Damalion offers a full suite of consulting services to help well-informed private and institutional investors find the right investment vehicle to match their needs and maximize the various benefits of setting up funds in Luxembourg. Should have inquiries regarding the incorporation of alternative investment vehicles in the Grand Duchy, our Damalion experts will be ready to discuss the investment option tailored to your needs.
Quick facts about Luxembourg FCP (Common Investment Fund)
Overview for investors, managers, and counsel. This page explains the FCP form, legal bases, governance, investors, taxes, and filings. Use it as a checklist and talk to licensed advisors for decisions.
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What is an FCP in Luxembourg?
An FCP (fonds commun de placement) is a contractual investment fund. It has no legal personality. A Luxembourg management company manages it. A Luxembourg depositary safekeeps assets. It can be set up as:
- UCITS FCP (retail, diversified) under the law of 17 December 2010.
- Part II UCI FCP (non-UCITS, may be offered to retail subject to rules) under the 2010 law.
- SIF FCP (well-informed investors) under the law of 13 February 2007.
- RAIF FCP (well-informed investors; set up fast; indirect supervision via AIFM) under the law of 23 July 2016.
FCPs may be stand-alone or umbrellas with sub-funds (compartments).
2025 updates for FCPs
- No change to the FCP core: still a contractual fund with no legal personality. Same headline minimum asset levels and subscription tax at fund level.
- CSSF reporting scope (from 27 June 2025): expanded notifications and information expected for some funds managed by Luxembourg IFMs, including many AIF FCPs. Check if your FCP is in scope and align templates.
- AIFMD II / UCITS changes preparing for 2026: Luxembourg has begun transposition steps. Plan for liquidity tools, delegation reporting, depositary clarifications, and new supervisory reports. Update policies and offering docs in your 2026 timetable.
- Contextual items: manager-level and EU horizontal files continue (for example, disclosure and tech topics). These do not change the FCP product form in 2025 but may affect documents and reporting.
Tip: run a gap check for UCITS-FCP vs AIF-FCP (RAIF/SIF/Part II): policies, prospectus wording, LMT annex, delegation map, and reporting calendar.
Key points at a glance
| Topic | UCITS FCP | Part II UCI FCP | SIF FCP | RAIF FCP |
|---|---|---|---|---|
| Legal nature | Contractual common fund, no legal personality; managed by a Luxembourg ManCo; Luxembourg depositary and auditor | |||
| Investors | Retail | Retail or professional (as per prospectus and CSSF authorisation) | Well-informed investors | Well-informed investors |
| Authorisation | CSSF product authorisation | CSSF product authorisation | CSSF product authorisation | No CSSF product authorisation; must appoint an authorised external AIFM |
| Minimum net assets | EUR 1,250,000 within 6 months of authorisation | EUR 1,250,000 within 12 months of authorisation | EUR 1,250,000 within up to 24 months (law-based timing) | EUR 1,250,000 within up to 24 months of launch |
| Eligible assets | Transferable securities and liquid assets (strict rules) | Broader assets (per prospectus; CSSF oversight) | Wide range; risk-spreading required | Wide range; if “risk capital” option, special regime applies |
| Distribution passport | UCITS retail passport in the EU | Marketing rules depend on target investors; AIFMD for AIFs | AIFMD passport for professional investors (via authorised AIFM) | AIFMD passport for professional investors (via authorised AIFM) |
| Taxes (fund level) | Generally exempt from income and net wealth tax; subscription tax (often 0.05%/0.01%) | Generally exempt from income and net wealth tax; subscription tax (typ. 0.01%) | Generally exempt from income and net wealth tax; subscription tax (0.01%) | Generally exempt from income and net wealth tax; subscription tax (0.01%); exemptions possible |
| Governance | ManCo board oversees the FCP. Depositary monitors cash and safekeeping. Auditor reviews annual accounts. Central administration keeps books and investor records. | |||
Notes: exact rates, exemptions, and timing follow the law and CSSF rules in force for each product type.
Setup checklist
- Choose regime: UCITS, Part II, SIF, or RAIF.
- Appoint Luxembourg ManCo (and AIFM where required).
- Appoint Luxembourg depositary, central administrator, and auditor.
- Prepare fund rules (management regulations), prospectus, KI(I)D where required.
- Define risk management, valuation, delegation, and conflicts policies.
- Plan AML/CTF controls, investor onboarding, and sanctions screening.
- File or notify as required (CSSF or AIFMD marketing).
- Reach minimum net assets by the legal deadline.
- Publish annual report; provide periodic reports.
Related reading
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.
