By Eshana Lutawan, Marketing Manager, HF Quarters
Luxembourg is consolidating its status as Europe’s leading fund domicile, driven by the convergence of sustainable investment demand, private markets innovation and regulatory reform. Sustainable funds continue to play a central role. The jurisdiction now accounts for more than 34% of all European sustainable fund assets, reinforcing its position as a preferred base for ESG and impact strategies.
The rollout of ELTIF 2.0 has added fresh impetus to the retail expansion of private markets, a theme gaining momentum across the region. Luxembourg has responded by facilitating fund structures suited to long-term, illiquid assets, particularly in private credit. RAIFs have become the dominant structure for new alternative launches, valued for their regulatory efficiency and alignment with the AIFMD regime.
Regulatory expectations have tightened, even as digital processes improve efficiency. The CSSF has improved fund approval workflows, yet disclosures face increased scrutiny under SFDR and CSRD. Looking ahead, Luxembourg’s outlook remains favourable, provided it continues to align operational innovation with investor protection.