Securitisation is the transaction whereby a securitisation organisation acquires or bears, directly or through another organisation, the risks related to claims, other property or undertakings assumed by third parties or inherent to all or part of the business conducted by third parties by issuing securities whose value or yield depends on those risks.
Securitisation organisations can be set up in the form of a fund or company:
- securitisation funds are made up of one or more joint ownerships or one or more fiduciary assets. The management regulations of the funds should formally provide whether the fund is subjected to the joint ownership system or that of a trust. The securitisation funds have no legal status. They are managed by a management company.
- securitisation companies should be in the form of a public limited liability company, a share partnership company, a public limited liability company or a cooperative company set up as a public limited liability company.
The fiscal scheme of securitisation organisations, if they are within the scope of the March 22, 2004 Act relating to securitisation (Memorial A – N° 46 dated March 29, 2004, page 719), can be summarised as follows:
- securitisation funds are subjected to the accounting and fiscal system of investment funds such as it results from the Acts dated March 30, 1988 and December 20, 2002 regarding collective investment organisations, except for the subscription tax, which is not owed;
- the acquisition price of property acquired by a securitisation organisation should correspond to the estimated value of realisation of that property;
- the undertakings taken towards investors and any other creditor by a securitisation company are entered as operating expenses;
- securitisation organisations are excluded from the scope of the fiscal integration scheme.
For investors and other creditors, the securitisation Act provides that:
- securities issued by a securitisation organisation cannot be exchanged in fiscal neutrality;
- distributions and other proceeds allotted to investors and other creditors of a securitisation organisation are income generated by securities;
- shareholding held in a securitisation organisation are excluded from the scope of the grand-ducal regulation dated December 21, 2001 bearing enforcement of article 166, paragraph 9, number 1 L.I.R. (exemption from gains in values from sales).
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