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ARTICLE · 02 SEPTEMBER 2022

Sustainability Preferences In MiFID Suitability Test Applicable Soon

ELVINGER HOSS PRUSSEN, société anonyme
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As of 2 August 2022, MiFID firms providing discretionary portfolio management services or investment advice must collect information about their clients' and potential...

LuxembourgFinance and Banking
Elvinger Hoss Prussen
Elvinger Hoss Prussen

As of 2 August 2022, MiFID firms providing discretionary portfolio management services or investment advice must collect information about their clients' and potential clients' sustainability preferences as part of the suitability assessment.

In accordance with Delegated Regulation 2021/1253, which amends MiFID Delegated Regulation 2017/565 regarding organisational requirements and operating conditions for investment firms, for the provision of these services investment firms are required to obtain specific information on their clients' preferences regarding (environmentally) sustainable investments and investments which consider adverse impacts on environment and society. Hence, transactions recommended or entered into in the context of portfolio management services now also have to meet the client's sustainability preferences besides the other parameters of the suitability test, including the client's financial situation, knowledge and experience.

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