Regulatory Development
On 9 December 2025, the CSSF drew attention to the publication by the Commission des normes comptables (CNC - Accounting Standards Commission) to a Q&A of the CNC (“Q&A CNC 25/036”) interpreting Article 1711-8(3), point (3), of the Law of 10 August 1915 on commercial companies in the specific case of companies operating in the alternative investment sector.
Article 1711-8(3), point (3), of the Law of 10 August 1915 on commercial companies provides that: “In addition, an undertaking need not be included in consolidated accounts where: (…) 3° the shares or (corporate) units of that undertaking are held exclusively with a view to their subsequent resale.”
In order to validly invoke the exclusion from the scope of consolidation referred to in Article 1711-8(3), point (3), of the Law of 10 August 1915 on commercial companies and thus be exempt from the obligation to draw up and publish consolidated accounts and a consolidated management report as referred to in Article 1711-9, point (2), of this law, companies operating in the alternative investment sector must fulfil a range of conditions.
The CNC’s updated guidance significantly tightens the conditions for using the consolidation exemption, requiring clearer evidence that subsidiaries are genuinely held for disposal.
The main conditions are:
- Managers must now maintain documented exit strategies, reassess holding periods, and provide fair value and risk disclosures in the notes to the annual accounts.
- Structures with investments held for more than 10 years, cascade arrangements, or service entities will need particular attention to ensure continued eligibility.
- The new framework applies immediately to financial years for which the filing deadline has not yet expired, meaning preparation for upcoming reporting cycles should begin now.
- Many Luxembourg SPVs will need to update their governance, valuation processes and reporting documentation. Early coordination with advisers and auditors is advisable to avoid unexpected consolidation requirements
Entities concerned
The Q&A CNC 25/036 targets Luxembourg investment structures whose activity consists in raising capital from investisseurs avertis and deploying it through investments intended to be realised at a gain.
This includes private equity, venture capital, private debt, infrastructure and similar alternative investment strategies.
Entities holding participations for long-term operational, industrial or strategic purposes fall outside the scope. The approach broadly reflects the profile of entities covered by the former CNC 09/002 and aligns with the characteristics typically associated with IFRS 10 investment entities.
Entry into effect and withdrawal of previous CNC Opinion
The Q&A CNC 25/036 applies to any financial year for which the filing deadline has not yet expired. CNC Opinion CNC 09/002 of 18 December 2009 is formally withdrawn.
Conclusion
The updated Q&A provides a clearer framework for investment structures relying on an exit-driven model for which consolidated financial statements may be of limited relevance. The CNC places emphasis on timely documentation, consistency of approach and transparency in the notes, factors which should be considered in the annual reporting cycle.
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