Money Market Funds (MMFs)

Investment funds using the label Money Market Funds (MMFs) must comply with Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money market funds (hereinafter the “MMFR”).

In addition to the specific provisions and characteristics set out in the MMFR, an MMF must also satisfy the standard characteristics and regulatory conditions related to the type of investment fund it has adopted, namely an undertaking for collective investment in transferable securities (UCITS) or an alternative investment fund (AIF).

The MMFR applies to investment funds established, managed or marketed in the European Union fulfilling the following requirements:

• are authorised or require authorisation as a UCITS according to Part I of the Law of 17 December 2010 relating to undertakings of collective investment or qualify as AIFs according to the Law of 12 July 2013 on alternative investment fund managers;
• invest in short-term assets; and
• have distinct or cumulative objectives offering returns in line with money market rates or preserving the value of the investment.

A UCITS or an AIF must not have characteristics substantially similar to those of an MMF, unless it has been authorised as an MMF in accordance with the MMFR.

Before submitting an authorisation request under the MMFR, both the investment fund and its investment fund manager are responsible for ensuring compliance with the applicable requirements as set out notably in Articles 4 (Authorisation of MMFs), 5 (Procedure for authorising MMFs that are AIFs) and 7 (Applicable rules) of the MMFR.

Assessment with a view to authorisation as an MMF for Luxembourg-domiciled UCITS or AIFs, as well as non-EU AIFs for which the CSSF will be the competent authority under the MMFR, is the responsibility of the CSSF upon receipt of the dedicated form available in the “Forms” section below.

AIFs can only be authorised by the CSSF as MMFs under the MMFR if the alternative investment manager (AIFM) has already been authorised under Directive 2011/61/EU to manage an MMF that is an AIF.

More information in relation to the authorisation process of an investment fund (not specifically related to the MMFR) is available on the Investment funds and vehicles page.

This process covers the approval of any amendment to an existing MMF or to one or several of its sub-fund(s).

A non-exhaustive list of examples of amendments falling under this process:

• launch of additional MMF sub-fund(s) to an existing MMF;
• change of type of an existing MMF (short-term VNAV, standard VNAV, public debt CNAV or LVNAV);
• withdrawal of an existing MMF from the scope of the MMFR.

For the launch of additional MMF sub-funds within an existing MMF, the dedicated form available in the “Forms” section below must be provided to the CSSF with any relevant information for the examination of the application for approval.

Due to the wide range of possible amendments and consequently the variety of information to be provided, no form is currently available for the submission of such information. More information relating to the amendment process of the investment fund (not specifically related to MMFR) is available on the Investment funds and vehicles page.

In accordance with Chapter 3 of the Law of 16 July 2019 implementing Regulations on EuVECA, EuSEF, MMF, ELTIF and STS securitisation and Circulars CSSF 20/734, CSSF 26/911 and CSSF 20/736, CSSF-supervised managers of money market funds must report financial information to the CSSF on a quarterly or annual basis.

Commission Implementing Regulation (EU) 2018/708 of 17 April 2018 defines technical standards with regard to the template to be used by managers of money market funds when reporting to competent authorities as stipulated by Article 37 of Regulation (EU) 2017/1131.

The European Securities and Markets Authority (ESMA) has published the “Money Market Fund Reporting – Technical Reporting Instructions” covering the detailed validation rules and the reporting XSD schema (Ref. ESMA/65-8-6480).

In addition, on 19 July 2019 ESMA published the “Guidelines on the reporting to competent authorities under Article 37 of the MMF Regulation” (Ref. ESMA/34-49-168).

Moreover, a specific version of the auth.093.001.001 ISO20022 message definition must be used by managers of money market funds.

The information to be submitted follows the common European reporting format developed by ESMA and must be transmitted in XML format via the designated transmission channels.