Ch. 5ADVANCED ~20 mins

Governance & Liability

Board duties, conducting officers and liability regime

Luxembourg fund governance is multi-layered. The number of boards depends on whether the fund is self-managed or uses external management entities.

Structure	Boards Present	Key Governance Driver
Self-managed investment company	1 board (fund = ManCo)	Fund board handles all management and oversight
Fund + external ManCo or AIFM	2 boards	Fund board + ManCo/AIFM board; must have clear governance model with no overlaps
Fund + ManCo + sub-AIFM	3 boards	Three-board setup; cross-border management adds complexity
FCP (common fund)	ManCo board only	FCP has no legal personality; no unitholder meetings; depositary provides additional oversight

FCP vs SICAV Governance

An FCP has no legal personality — governance is driven entirely by the ManCo board. A SICAV has legal personality, its own board, and shareholders with ultimate control through annual/EGM meetings. Self-managed UCITS and internally managed AIFs must keep real decision-making and admin centers in Luxembourg.

▸Board committees are permitted (audit, investment, valuation, remuneration) — but committees do not reduce the full board responsibility
▸Boards must meet at least quarterly (CSSF expectation); open-ended fund boards must not meet less than quarterly
▸Each meeting requires a written agenda and minutes; telework policies must define minimum physical meetings
▸ALFI Code of Conduct (updated 2022) and OECD Principles are key governance benchmarks referenced by CSSF