Securitization vehicle Table
| Securitization vehicle | |
|---|---|
| Applicable legislation | Law of 22 March 2004 (“Securitization Law”) |
| Authorisation and supervision by the CSSF | No, unless issue on a continuous basis of financial instruments offered to the public. The securitisation vehicle issues on a continuous basis when it carries out more than three issuances of financial instruments offered to the public during the financial year. All the issuances by the compartments should be added up. The issuance of financial instruments is offered to the public when it is not intended for professional clients, the denominations are less than 100,000 euros and it is not distributed as private placement. |
| Qualification as an AIF | No, in case - such vehicle meets the definition of “securitisation special purpose vehicle ” under the AIFM Law; - it issues collateralised debt obligations; - it only issues debt instruments; - such entity is not managed according to an investment policy within the meaning of the AIFM Law. |
| Exemption from AIFMD full regime under lighter regime (AIFMD registration regime) | Possible. |
| Eligible investors | Unrestricted. |
| Eligible assets | Unrestricted. The securitisation vehicle may acquire or assume, directly or through another undertaking, risks relating to claims, other assets, or obligations assumed by third parties or inherent to all or part of the activities of third parties and issues financial instruments or contracts, for all or part of it, any type of loan, whose value or yield depends on such risks. |
| Risk diversification requirements | No risk diversification requirements. |
| Legal Form | A securitisation vehicle may be set up in one of the following forms: - a securitisation company (SA, Sàrl, SCS, SCSp, SENC, SCA, SAS, SCSA); or - a securitisation fund consisting of one or several co-ownerships or one or several fiduciary estates and managed by a management company. |
| Umbrella structure | Yes. |
| Capital requirements | If the securitization vehicle is set up as a company, it depends of the form: - SA / SCA: EUR 30,000 - Sàrl: EUR 12,000 If the securitization vehicle is set up as a fund, there is no minimum capital requirement. |
| Required Luxembourg service providers | - Alternative Investment Fund Manager (if the securitisation vehicle qualifies as an AIF). - Management company (if the securitisation vehicle is set up in the form of a fund). - Independent auditor. - No depository institution (unless for regulated securisation vehicles). - No administrative agent. |
| Possibility of listing | No. |
| European passport | No, unless it falls under the scope of the full AIFMD regime. |
| Net asset value (NAV) calculation and redemption policy | Not required. |
| Overall income tax (corporate income tax and municipal business tax) | General aggregate rate for taxable securisation companies: 24.94%. Securitisation vehicles should be able to deduct from their gross profits their operational costs and the dividends or interests distributed to the shareholders / creditors. Therefore securitisation companies should not generate significant taxable profits and should therefore to a large extent be tax neutral. |
| Subscription tax | No subscription tax. |
| Wealth tax | No wealth tax. |
| Withholding tax on dividends / interests and capital gains | Not subject to withholding tax. |
| Benefit from double tax treaty network | Yes for securitisation companies. |
| Benefit from the EU Parent Subsidiary Directive | Yes. |
| Thin capitalization rules (debt-to-equity ratio) | No debt-to-equity ratio. |
| Practical use | - True sale and synthetic securitisations. - Securitisation of a portfolio of securities. - Securitisation as structure for intra group financing activities. - Securitisation of non-performing loans. - Securitisation of leasing receivables. - Securitisation of both tangible and intangible assets. - CLOs (possibility of active management). |
Other Vehicles
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