Luxembourg was the first European Union Member State, in 1988, to implement the first European Directive on undertakings for collective investment in transferable securities (UCITS). This modern legislative framework, combined with a high degree of political and social stability, attracted fund promoters from all over the world. These groups made the Luxembourg financial centre their gateway to the European collective investment market.
Today, Luxembourg is the leading investment fund centre in Europe and the second largest in the world after the United States.
Luxembourg financial services companies have specialised in the design, domiciliation, administration and cross-border distribution of collective investment schemes. As a result, Luxembourg investment funds have succeeded in gaining a large market share not only in other EU Member States but also in Asia, Latin America and the Middle East.
The Luxembourg legal and regulatory framework can accommodate a vast range of investment strategies. By setting up a multiple-compartment structure within a single legal entity and/or issuing different classes of shares, a promoter can launch funds that are made to measure for specific markets or client groups.