In 2017 the Court of Appeals confirmed a change in position regarding the enforcement of awards annulled in the seat of arbitration. This decision broke with the court's earlier interpretation – which had favoured enforcement and been standard practice since 1999 – and solidified its new approach of denying enforcement when an award does not produce effects in its jurisdiction of origin.
In recent months, the Luxembourg Financial Supervisory Authority (CSSF) has been active and the industry is preparing for the open banking wave. The changes in response to the EU Payment Services Directive aim for a generally positive evolution of the payment scene in Luxembourg. The CSSF has published the fallback exemption request form and adopted several circulars that are applicable to payment service providers.
By way of the Law of 20 July 2018, Luxembourg has finally implemented the EU Payment Services Directive (PSD 2). As the PSD 2 is a full harmonisation directive, most of Luxembourg's PSD 2 provisions are identical to the legal framework implemented across the European Union. Nonetheless, EU member states were given scope to decide on certain topics and the Grand Duchy seized the opportunity to define its own rules.
EU Regulation 655/2014, which established a European Account Preservation Order (EAPO) procedure, aims to facilitate the collection of claims in civil and commercial matters by introducing a uniform EU procedure for identifying and freezing funds held in a debtor's bank accounts in another member state. This increased transparency is a particularly new development for Luxembourg, which recently introduced a straightforward EAPO enforcement procedure that is in line with its existing enforcement measures.
A recent Luxembourg District Court judgment has confirmed the well-established, flexible and creditor-friendly environment offered by the Collateral Act. The court ruled that the enforcement of a pledge cannot be set aside, except in the case of clearly established fraud. The main takeaway from the decision is the confirmation of the possibility offered by the act to enforce a pledge without any payment default and in case of a breach of a financial covenant.
The Luxembourg financial sector regulator (CSSF) recently published a number of circulars in order to streamline its regulation of IT outsourcing in the financial sector and introduce specific rules for the use of cloud services. In doing so, the CSSF has defined the conditions under which financial service providers may outsource activities without infringing the regulatory principles of central administration and sound governance.
The new Markets in Financial Instruments (MiFID) Act, which transposes the Markets in Financial Instruments Directive and implements the EU Markets in Financial Instruments Regulation, was recently voted into law. Most issues relating to markets in financial instruments are covered by the first part of the act, while the provision of investment services will continue to be governed by the Financial Sector Act, as amended by the second part of the MiFID Act.
Following the adoption of Bill of Law 7022, the new Act on Market Abuse recently entered into force. The act significantly increases the administrative and criminal penalties for infringements of market abuse provisions and designates the Luxembourg financial sector regulator as the competent authority for the purposes of the EU Market Abuse Regulation. It also extends the definition of 'regulated information' provided for in the Act on Transparency Requirements for Issuers.
The Luxembourg Stock Exchange (LuxSE) recently introduced a new specific platform for green financial instruments: the Luxembourg Green Exchange (LGX). Although joining the LGX is optional and green securities can be listed on the LuxSE and recognised as green regardless of whether the issuer chooses to join the LGX, having securities admitted to the LGX will increase investor confidence as to their green nature.
The EU Market Abuse Regulation recently came into force in Luxembourg and a new market abuse regime affecting listed companies has been implemented. In addition, a wider set of rules covering the disclosure of inside information, insider list manager transactions and modifications relating to multilateral trading facility (MTF) platforms – including the Luxembourg Euro MTF market – have been introduced.
Updated Luxembourg Stock Exchange (LuxSE) rules and regulations came into force in January 2016 and the LuxSE recently published frequently asked questions (FAQs) regarding the Euro MTF Market rules. The FAQs include information on approvals and the requirements for the different types of security generally issued. They also provide support to practitioners in regards to prospectus approvals and the Euro MTF market listing process.
Luxembourg implemented the EU General Data Protection Regulation through the Law on the Organisation of Luxembourg's National Commission for Data Protection and the General System for Protecting Data. The law made a number of changes to the Labour Code, including extending the circumstances in which employers can process personal data to monitor their employees. Further, employers no longer have to obtain prior authorisation to monitor employees.
In addition to an employee's basic monthly remuneration, employment contracts often provide for the payment of various bonuses or gratuities, the specifics of which can be freely agreed by the parties to the employment relationship. In a recent dispute between a chief operating officer and her former employer, the Court of Appeal considered whether the annual bonus provided for in the employee's contract was owed to her since she had failed to complete her trial period.
The Law of 29 August 2017 reformed the system under which the government co-finances employee vocational training in order to encourage employers to invest in developing their employees' skills while reducing the inequalities in the amount of aid provided to large and small companies. However, a number of matters remained unclear. As such, a recent Grand Ducal regulation has provided useful clarification, particularly with regard to the content and practical details of co-financing requests.
A new law modifying the Labour Code and the Modified Law establishing the General Status of Civil Servants recently came into effect. The law has increased the minimum statutory paid leave entitlement from 25 to 26 days a year. It has also declared Europe Day, celebrated annually on 9 May, a statutory public holiday.
Employees who cannot work due to illness are, in principle, protected against dismissal. The Court of Appeal recently reiterated the conditions which must be met for this protection to apply and, failing this, the circumstances in which an employee's absence may justify dismissal for serious misconduct. Notably, the unique nature of the case and the fact that the employee had worked for the company for nine years did not affect the court's decision.
The Council of Government recently came to an agreement on the status of British citizens living in Luxembourg in the event that the United Kingdom leaves the European Union on 29 March 2019 without a withdrawal agreement. According to the statement, answers to questions concerning the situation of British nationals living in Luxembourg, as well as Luxembourg nationals living in the United Kingdom, are available online.