Authorisation procedure and legal requirements

Explanations on the authorisation procedure applicable to PFS

Articles 13 to 23 of the Law of 5 April 1993 on the financial sector (“LFS”) lay down the legal requirements that must be met in order to obtain a PFS (professional of the financial sector) authorisation and the procedure to follow.

“PFS” means “a group composed of:

  • investment firms referred to in Part I, Chapter 2, Section 2, Subsection 1;
  • specialised PFS referred to either in Part I, Chapter 2, Section 2, Subsection 2 or in Article 13 and which do not belong to the categories of the first and third indent of this definition;
  • support PFS referred to in Part I, Chapter 2, Section 2, Subsection 3.” 

(Article 1 of the LFS, definition no. 28)

The legal requirements and the procedure are explained in the document below:

Explanations on the authorisation procedure applicable to PFS - 27.03.2018

 

New technologies

The evolution of financial activities is adapting to new technologies. Creating, developing and applying new digitalised technologies to financial markets allows an integration in traditional activities, or the development of new tools. In Luxembourg, depending on the technology, an authorisation may be required.

As regards Robo-advice, an authorisation is required for the provision of financial advice and/or the automated management of customer assets. The applicable PFS status will be determined based on the business model used, the nature of the services provided, and the structure of the platform (including the agreements with the users). Robo-advisor might thus fall under one or more of the below PFS categories: investment adviser (Art. 24), broker in financial instruments (Art. 24-1), commission agent (Art. 24-2) or private portfolio manager (Art. 24-3).

Details on Robo-advice