CSSF Circular 24/856: NAV errors and breaches explained

Readers often search by paragraph number. Typical searches are "paragraph 121 of circular 24 856", "point 35 tolerance threshold" or "24/856 de minimis". They are usually reading a 47-page CSSF text at the desk, in the middle of a remediation. The day-one summaries published in April and December 2024 stopped at the circular.

The CSSF's own FAQ (Version 1, 24 December 2024) sits alongside the text. It answers the operational questions the circular leaves implicit: closed-ended funds, settlement-mismatch breaches, what counts as a fee error, and whether de minimis needs CSSF sign-off. This page puts the circular and its FAQ in one place, by point number.

Circular CSSF 24/856 entered into force on 1 January 2025 (pt 162). It repealed Circular 02/77, the 2002 text the industry knew by heart, on the same date (pt 166). Errors detected between the circular's publication and 1 January 2025 still run under 02/77 (pt 163). The trigger is the detection date, not the error date. Everything below describes the new regime, for errors detected on or after 1 January 2025.

The cross-domicile view, comparing Luxembourg's thresholds with Ireland, the UK, Jersey and Guernsey for the same NAV error, sits on the NAV error correction matrix. This page stays inside 24/856.

Point by point, the scope works as follows.

The circular applies to UCITS, Part II UCIs, SIFs and SICARs directly. It reaches ELTIFs, MMFs and EuVECAs/EuSEFs through points 2 to 4 of Section 2.1, its scope section. The FAQ's first clarification is the one most readers need: RAIFs are not in scope. The exception is a RAIF that falls into a listed category for which the CSSF is the competent authority, and the FAQ's example is a Luxembourg ELTIF (FAQ Ch. I, Q1). A plain SIF-regime RAIF is not bound by 24/856. A RAIF set up as an ELTIF is.

The reach is not uniform. UCITS, Part II UCIs, SIFs and SICARs get the circular in its entirety (pt 1). Two other groups get it in its entirety except Chapter 8, the réviseur d'entreprises agréé regime (pts 2 and 3). They are Luxembourg ELTIFs that are not Part II UCIs, SIFs or SICARs (including RAIF-ELTIFs), and MMFs that are not UCITS, Part II UCIs or SIFs. A RAIF-ELTIF therefore sets thresholds, corrects, compensates and notifies like everyone else. The separate-report and special-report regime in Chapter 8 does not attach to it.

Luxembourg EuVECAs and EuSEFs outside the regulated regimes follow a three-way split in point 4. Where an IFM established in Luxembourg manages them, the circular applies in its entirety except Chapter 8 (pt 4(i)). Where a non-Luxembourg IFM manages them, it covers only breaches of Article 5 of the EuVECA or EuSEF Regulation and of the constitutive documents (pt 4(ii)). Where a registered Luxembourg AIFM manages them, it covers only breaches of the EuVECA or EuSEF Regulation (pt 4(iii)). Chapter 8 applies in neither case.

Two chapters do most of the work, and they switch on separately:

The closed-ended carve-out is narrower than an exemption. It sits in the last paragraph of pt 27. A closed-ended UCI must still follow pt 26 and the first paragraph of pt 27: reliable valuation, and policies and procedures that limit and detect NAV calculation errors. It must also "ensure that corrective measures have been taken to correct, where appropriate, any NAV calculation error". What it does not do is set a mandated threshold or notify NAV calculation errors to the CSSF. The carve-out covers NAV errors under Chapter 4 only; pt 152 still requires any other error or non-compliance in scope to be notified.

The audit check survives. The same paragraph requires the closed-ended fund's REA to verify, as part of the statutory audit, that the NAV accurately reflects the value of the UCI's assets and liabilities. The test is the NAV calculated in line with the constitutive documents and/or prospectus. The footnote to Table 9 repeats this, where a significant NAV error in a closed-ended UCI is marked "No intervention (*)".

The FAQ goes further. It recommends that a closed-ended fund define a tolerance threshold internally, purely to identify which errors need correcting. It confirms that doing so does not bring the fund into the Chapter 9 notification duty for NAV calculation errors (FAQ Ch. II, Q3). For NAV errors, the workable closed-ended position follows. Set a threshold for internal control, correct at or above it, notify no one, and expect the auditor to review it anyway.

The carve-out does not reach semi-liquid funds. The CSSF states that a UCI with limited redemption possibilities, such as a semi-liquid Part II UCI, is open-ended under the circular's definition. Chapter 4 and its tolerance thresholds therefore apply in full (CSSF Feedback Report, 5 October 2026, section 3.1).

Chapter 3 is four pages long and rarely quoted. It settles the two questions every incident opens with: who has to fix this, and who ends up paying. The operative principle is point 15, repeated at point 117: the party that caused the error, through non-compliance with the obligations applicable to it, must ensure compensation. Pt 133's rule that "the fund does not bear the correction costs" rests on that sentence.

The circular deliberately splits responsibility for causing an error from responsibility for getting it corrected. Where the UCI has designated an IFM, the IFM ensures the correction and remediates the loss to the fund and its investors, under the supervision of the UCI dirigeants. Where there is no IFM, the UCI dirigeants carry that duty themselves (pt 16).

Appointing an IFM does not hand the problem over. Point 17 keeps the UCI dirigeants in charge of the UCI's overall policy "even under a delegation arrangement". It requires them to supervise the IFM and lets them impose rules of conduct on it, including where the IFM sub-delegates. For a fund in contractual form (FCP), the IFM's dirigeants are deemed to be the UCI dirigeants.

The notification itself may be submitted by any authorised filer: the UCI, the IFM, a delegate mandated by either, or the UCI administrator (CSSF practical guide, §2.3).

Delegation reduces nobody's obligations, at any level of the chain:

• IFM. Its responsibility "is not affected by the fact that it has delegated any functions to a third party" (pt 19). Pt 19 cites Article 110 of the UCI Law, Article 18 of the AIFM Law and Article 75 of Regulation 231/2013. The delegations and sub-delegations in place "shall not prevent the IFM from executing its own obligations" (pt 20). The circular names valuation and NAV determination as collective portfolio management functions the IFM owns.
• UCI administrator. Under Circular CSSF 22/811 it must have procedures to detect, assess and notify errors to the UCI or IFM. Errors must be recorded, monitored and corrected upon the UCI's or IFM's approval. The administrator draws up the remediation plan for their approval, implements the corrective measures and follows them up (pt 23). Its own delegation does not exempt it either (pt 24).
• UCI dirigeants. They must ensure that the relationships with every service provider involved in the fund are covered by adequate arrangements, "including contractual arrangements" (pt 14). The contract is where "who caused it, who pays for it" gets settled, and it needs settling before an incident.

The next point matters for any borderline call. Three separate parties have a standing route to the CSSF that does not run through the fund, and your inaction triggers all three, not the error itself:

• The depositary. Where it notices an error, it informs the dirigeants of the UCI or IFM. Where it notices that those dirigeants do not act on it, "the depositary must notify it to the CSSF" (pt 25).
• The REA, the fund's approved statutory auditor. It informs the dirigeants without delay and asks that the error be treated and notified. If they do not follow up, it notifies the CSSF at the latest with its management letter and separate report. It notifies immediately where the inaction may adversely affect the rights of the UCI or its investors (pt 140).
• The UCI administrator. 22/811, as amended by Circular CSSF 25/900, sets its duty. It must inform the CSSF without undue delay where it learns that the UCI or IFM does not properly fulfil its legal, regulatory or contractual obligations. The same applies where the UCI or IFM does not notify the CSSF as required of NAV errors, breaches or incidents, whether material or non-material (22/811, pt 18).

In practice, a decision not to file is not one the fund makes alone. The version of the incident that reaches the CSSF second is worse than the one that reaches it first.

Does the administrator's annual return still count NAV errors?

No, not on the UCIAR channel since the end of 2025. Until then the UCI administrator's annual return, Annex B of 22/811, counted NAV errors, material NAV errors and corrected NAVs. Each count was split by whether the administrator was the responsible party, alongside a count of active investment breaches. Annex B's materiality footnotes referred to the now-repealed Circular 02/77.

Circular 25/900 repealed Annex B. The replacement format the CSSF published on 31 December 2025 drops those fields. It consists of the UCI Administrator Annual Reporting practical and technical guidance, v2.0, issued "to take into account the new reporting format", with JSON schema v3.0.0. The return now collects the number and net assets of the UCIs administered per function, and what is delegated. It has no error field at all.

The predecessor schema (v2.0.0, 27 September 2023) carried them explicitly: rgstrNavErrors…, …MaterialNavErrorsForRegLuxUCI…, …CorrectedNav… and navFaActiveInvestBreaches. None survive. Neither 25/900 nor the CSSF communiqué of 16 December 2025 says so in terms; the published reporting format does. Nothing in either source restates a materiality definition, so the return itself engages no 24/856 threshold.

That finding covers the UCIAR channel only. For several entity types, UCIA reporting moved into another circular's long-form report or self-assessment questionnaire. Credit institutions, IFMs, support PFS and investment firms report under 22/821, 23/839, 24/850 and 25/870. Specialised PFS report through the Specialised PFS SAQ. Those question sets are published only inside the eDesk procedures, so it is not possible to say whether an error count survives there. Entities outside those two channels still file through UCIAR, at the latest five months after their financial year-end (CSSF communiqué, 16 December 2025).

The result, for administrators filing through UCIAR: their annual return no longer tells the CSSF that a fund's NAV errors are accumulating. What does is the fund's own 24/856 notifications, the three escalation routes above and the auditor's sampled procedures. Check your own channel's current instructions before assuming that error counts do or do not still reach the CSSF that way.

Points 28 to 30 come before any threshold. The threshold question comes second. The circular first answers whether there is an error at all, in a single sentence that helps anyone defending a valuation after the fact. Point 29 covers the rules in the law, the constitutive documents and the prospectus. They must be "applied consistently and in good faith, on the basis of up-to-date and reliable information available at the time of the calculation". Where they are, the NAV is presumed to be correctly calculated.

The test is the information held then, not the information held now. A price that later proves wrong is not, by itself, a NAV error. That is why the FAQ's audit-fee example, an accrual booked in good faith on reliable information that later proves too low, is not treated as an error at all.

Point 30 comes at it from the other side and lists the causes shown above. It also says where they arise. These factors "may arise at the level of the entity which calculates the NAV (in principle, the UCI administrator)". They may also arise "at other levels of the UCI organisation (e.g., dirigeants of UCIs, IFMs, external valuer, etc.)". The administrator is where errors are usually found. It is not where they are all made, and pt 15 allocates compensation by cause, not by who ran the calculation.

The UCI dirigeants, together with the IFM where there is one, fix the self-set threshold in pt 35(d). It is where an inspection starts. The circular says what the analysis must weigh, then reserves the right to read it. Sub-point (i) lists five mandatory factors, introduced by the words "at least".

• The UCI's characteristics, including whether it is open- or closed-ended and how often it opens for subscriptions and redemptions.
• The investment policy set out in the constitutive documents and/or prospectus.
• The nature of the investments, with listed versus unlisted as the circular's own example.
• The risk profile, naming liquidity, market and credit risk and the fund's volatility level.
• The valuation policy in place.

Table 3 is a reference point, not a floor to move away from. Sub-point (ii) says the CSSF expects a professional-investor Part II UCI, ELTIF or SIF running a policy similar to a Table 3 line to arrive at a similar number. Sub-point (iii) carries the 5% cap and the ban on using 5% by default. It also says the UCI "must make available to the CSSF" the specific analysis, and that the CSSF may request it and ask for more.

A threshold set above Table 3 triggers disclosure. Investors must be informed through the official and usual communication channels named in the constitutive documents or prospectus. The same condition attaches to a retail Part II UCI or ELTIF using the pt 35(c) derogation to go past 1% for "other assets". Such a fund must also meet sub-points (i) and (iii) of (d). A self-set threshold with no written analysis behind it does not meet pt 35(d), and an on-site inspection will record that as a finding.

Points 36 to 38 set the mechanics that most often cause errors in practice:

• One threshold per sub-fund, across all share classes (pt 37(i)). You cannot set a looser threshold for an institutional class inside a retail sub-fund.
• Set before the first NAV. The threshold must be documented under the fund's policy on incorporation or launch of a new sub-fund. In any case it must exist before the first NAV is published (pt 37(ii)).
• Look-through for funds of funds, index trackers and feeders. The threshold follows the target exposure, not the wrapper (pt 37(iv)).
• The stricter foreign threshold. Where a country in which the units are admitted to marketing requires a stricter threshold, the UCI "must retain this more restrictive tolerance threshold". It then applies to the whole sub-fund and every investor in it, "regardless of their country of origin" (pt 37(v)). This is not an election: a single foreign registration can tighten the Luxembourg tolerance for everyone.
• Aggregation. Untreated errors that each sat below the threshold, simultaneous or successive, are added together. If together they reach or exceed the threshold, they count as one significant error (pt 38). An error log that looks clean line by line can still be reportable.
• A lower internal threshold binds you. Pt 36 expressly permits a UCI to apply thresholds lower than Tables 1 to 3. The FAQ closes the obvious temptation: once your approved policy sets a threshold below the circular's, all of 24/856, correction and notification alike, follows your number. You cannot set 0.30% internally and then notify only at 0.50% (pt 36; FAQ Ch. II, Q2).

Chapter 5 governs breaches of the investment rules, and almost all of it depends on one classification made at the moment of discovery. Point 54 requires the UCI or IFM to determine whether a breach is active or passive. Point 55 defines passive narrowly: breaches that "occur for reasons beyond the control of the UCI or as a result of the exercise of subscription rights". Its worked example is market-price movements that shrink the NAV a restriction is measured against.

Active non-compliance is the residual: everything that "cannot be qualified as being beyond the control" of the UCI. Point 56 sets out what that covers. It catches voluntary investment or divestment decisions, and the absence of an action or decision "where non-compliance with an investment rule was foreseeable or avoidable". It covers breaches arising from "an intentional decision, inadvertence, human error or from operational or technical/IT failures", whether at the dirigeants, the IFM or a delegate.

The classification decides everything that follows. Point 55 puts passive non-compliance outside Sections 5.4, 5.5 and 5.6 entirely and states that it "must not be notified to the CSSF in accordance with Chapter 9". There is no correction procedure and no filing. What the fund owes instead is corrective measures "within a reasonable period of time", with the dirigeants monitoring the position until it is cleared.

Point 55 adds a concession for non-UCITS holding less liquid assets: SIFs, SICARs and Part II UCIs, open- or closed-ended. Their dirigeants may, "in specific and duly justified circumstances", keep the offending position where investors' interests justify it.

That is why the FAQ's third chapter matters more than its length suggests. It spends four of its twelve questions pushing back on optimistic "passive" calls. A settlement mismatch that pushes deposits over the 20% limit is active, because it was predictable (FAQ Ch. III, Q1). A shortened US settlement cycle is something pre-trade controls were supposed to model, not an event beyond the fund's control (Q2). A "passive" classification is a conclusion the fund must be able to defend in writing, not the default for anything it did not intend.

Which rulebook is a breach tested against (pt 49)?

Point 49 defines the perimeter. It covers all asset-eligibility rules, portfolio management techniques and investment restrictions in the regulatory texts: European regulations, sector laws, Grand-ducal and CSSF regulations, and CSSF circulars. Under point 50 it adds the contractual rules in the fund's own constitutive documents and prospectus. Point 51 states the consequence directly: "all the investment rules that apply to a UCI are to be considered". A prospectus limit the fund wrote itself is an investment rule for Chapter 5, and breaching it is the same event as breaching a statutory one.

One of point 49's named examples has since been repealed. It cites "the investment restrictions laid down in Circular CSSF 07/309 on risk-spreading in the context of specialised investment funds". Circular CSSF 25/901 repealed 07/309 on 19 December 2025 (pt 51), together with Circulars 02/80 and 06/241 and Chapters G and I of IML 91/75. 24/856 has not been amended to follow, so its cross-reference now points at an archived text.

The perimeter is unchanged in kind but changed in content. 25/901 sets risk-spreading by investor type instead: 25% per position, raised to 50% for funds reserved to well-informed or professional investors (25/901 pts 8 and 11). It grandfathers the rules of funds and compartments authorised before 19 December 2025, which may continue to apply them (pt 50). For a legacy SIF, the old 07/309 spread may still be the rule a breach is measured against. For anything authorised since, the reading below points to 25/901's rules, subject to the fund's authorisation file. Applying the wrong one means the breach test in pt 91 runs against the wrong number. The full picture is on the Circular 25/901 page.

On this reading, pt 49 now picks up 25/901's limits for new funds, while grandfathered funds keep the rules they were authorised under (25/901, pt 50). The reading follows from the two texts together. No CSSF statement says so. The CSSF has published no note reconciling the two, and the circular's document page still lists the 29 March 2024 text with no amendment. The CSSF's list of circulars applicable to UCIs carries no 2026 circular amending or repealing 24/856. Confirm against the fund's own authorisation file before relying on this reading for a live breach calculation.

What did the repeal of IML 91/75 remove?

The clearing-out has since finished, and it took a text the perimeter had relied on for thirty-five years. The chapters of Circular IML 91/75 still standing after 25/901 took Chapters G and I were repealed in full on 22 May 2026 by Circular CSSF 26/912. That two-page circular repeals "with immediate effect", carries no transitional provision and puts no replacement text in their place.

What went was anchored to the superseded Law of 30 March 1988 and had long been read through its successors. Until that date, it sat inside pt 49's "CSSF circulars" perimeter:

• Chapter F, the UCITS rules on asset composition, ancillary liquid assets and borrowings. Next to pt 52's calculation basis, it held the sentence that "the investment limit percentages to be complied with by UCITS must be applied to the net assets of UCITS".
• Chapter H, the techniques and instruments for efficient portfolio management: options, financial futures, securities lending, repurchase agreements and currency-risk hedging. 25/901 had already stopped applying it to Part II UCIs.
• Chapter M, whose monthly reporting required an explanation wherever the NAV per unit moved more than 10% against the previous month-end. It was the last NAV-anomaly trigger at circular level outside 24/856 itself.

The CSSF's stated reason is that the content is either overtaken by national and EU rules or "incorporated into the CSSF's administrative practice". The second half matters for a control file. A rule that survives only as administrative practice is not a published text you can cite as evidence of which limit a breach was measured against. Where an internal procedure or a prospectus still cites IML 91/75 by name, that citation no longer points to a text in force.

26/912 repealed the 1991 text in two pages, with no schedule. The CSSF has published no mapping of which chapters fall in which category. Some rules were previously tested by reference to 91/75, such as Chapter F's asset-composition and borrowing rules or Chapter H's efficient portfolio management techniques. For those, there is no primary text to cite for the surviving position. 24/856 is unamended and the CSSF has issued no note reconciling the two. Check the current UCI Law and the fund's own documents before relying on a 91/75-derived limit. Under pt 50, a rule written into the fund's own constitutive documents remains an investment rule for Chapter 5 whether or not the circular behind it still exists.

What is a limit measured against, and for how long (pts 52-53)?

Point 52 sets the calculation basis. For UCITS, the quantitative investment rules in the regulatory framework apply to the NAV. Where the limit is contractual, the constitutive documents and/or prospectus "must specify the calculation basis", and general practice is the NAV again. For non-UCITS, the regulatory texts use different bases: the circular names the NAV and the capital of the UCI. Contractual limits are set in practice against the NAV, capital or gross assets. A prospectus limit drafted without a stated basis is a breach test the fund cannot run, and pt 52 puts the fix in the fund documents, not the control file.

Point 53 sets the time perimeter. Compliance is owed on an ongoing basis through the life of the UCI until dissolution or liquidation. The only exceptions are those a regulatory text or the fund's own documents provide. The circular names two. The first is the six-month period in Article 49(1) of the UCI Law. It lets a newly authorised UCITS derogate from the investment limits of Articles 43 to 46 for six months from authorisation. The second is the longer ramp-up and divestment periods that AIFs write into their own documents to build a portfolio or sell it down before liquidation.

Inside a documented window there is no non-compliance to classify at all. That is why the window has to be in the prospectus before it is needed. Outside one, "we were still building the portfolio" is not a defence; it shows a clause missing from the prospectus.

Which controls must detect a breach (pts 57-64)?

Section 5.3 is the part of Chapter 5 that a fund's control file is judged against after the fact. Point 58 splits the arrangements in two. Pre-trade controls test the intended transaction against the applicable rules when the portfolio management decision is taken, at the IFM or its delegate. They are "all the more important" for UCIs that may hold less liquid or illiquid assets.

Post-trade controls run after the trade, and the circular gives them a specific job. They determine whether the non-compliance is active or passive, which triggers the corrective action and the impact calculation. Post-trade also carries the only hard timing in the section: it "must occur at the latest when calculating the next NAV". Frequency and design go in the written procedures (pt 59).

Point 60 sets the principle that matters most for funds with infrequent valuation points. The UCI must comply with the applicable investment rules at all times: at every NAV and between two NAVs, including on an intra-day basis. Point 61 extends that to the controls. They must detect, correct and notify transactions carried out between two NAVs that breach the eligibility rules or the same-issuer holding limits. Points 62 to 64 then set the proportionality most funds operate under:

• The general concession (pt 62). For diversification and other restrictions measured against net assets, or another reference such as gross assets, the CSSF considers it generally sufficient to verify at each NAV calculation. That is the default an administrator will run.
• The exception (pt 63). A UCI materially exposed to between-NAV breach risk, because it trades significantly between two NAVs or intra-day, needs controls proportionate to the nature, frequency and complexity of those trades. They must ensure compliance between the NAVs. An actively trading fund cannot rely on pt 62.
• Infrequent NAVs (pt 64). A fund with a monthly or quarterly NAV that trades between NAVs must verify by another route. The circular's example is a control at the time of the transaction. A long gap between valuation points is not a defence.

This links straight back to the active/passive classification. If pt 63 described the fund and it checked only at each NAV, the breach was foreseeable and avoidable, which is pt 56's definition of active.

An active breach raises two questions that are often conflated. One is what the fund does to the portfolio; the other is what is owed to the fund. Point 67 lists the corrective actions by example. They include selling ineligible investments or excess positions, adjusting a portfolio that sits under a prospectus minimum, and cutting borrowings back below the cap. Another is having the counterparty post eligible collateral on a securities financing transaction. Point 67(vi) accepts that sometimes no corrective action is needed, because market movement or capital activity has already cured the position.

Point 69 attaches a different impact test to each. Sales and portfolio adjustments require a full impact calculation. A collateralised securities financing breach needs none unless the counterparty defaulted during the breach period. A breach that corrected itself still needs the unrealised result computed from the irregular investment's prices across the period. "It fixed itself" does not mean "nothing to calculate".

The correction runs on two timetables, and only one of them can stretch. Point 66 requires the necessary measures to be decided without delay in every case; what varies is execution. For UCITS and UCIs invested in liquid assets, the corrective action "must be implemented directly after the detection" of the active non-compliance. For non-UCITS holding less liquid or illiquid assets (the circular names SIFs, SICARs and Part II UCIs), the decision is still owed without delay. Implementing it "could possibly take longer", scaled to the fund type, its investment policy and the assets held.

Point 65 applies to both. On discovery, the procedures must inform the IFM, the UCI administrator and the depositary without delay. The UCI and IFM dirigeants must be informed well enough to perform their Chapter 3 role. Illiquidity allows more time to execute, not more time to decide. A dated decision record is the only evidence of which of the two the fund used.

Pt 71 then removes the threshold: the NAV tolerance thresholds cannot be applied (pt 71). Money owed to the fund for a breach has no materiality filter. The threshold only governs the separate NAV-error test under pt 91.

Timing is prescribed too (pt 76). For portfolio transactions the impact period runs trade date to trade date: from the trade that caused the breach to the regularisation trade, or the date compliance returned unaided. For cash and deposit breaches it runs on value dates, from effective inflow to effective outflow. If the calculation nets out to a gain, the gain stays with the fund (pt 75); it is not netted against the next loss.

The impact runs on one of two methods, and the choice is not free.

Three constraints apply to both methods. First, the method must be defined in an internal policy from launch. It must be precise enough that cases are treated consistently and nobody can pick the method by the compensation it produces (pt 72). An umbrella may set it fund-wide or per sub-fund, and may vary it by breach type (pt 73).

Second, switching method after the fact is barred. A change from accounting to economic must be justified in investors' interests and approved by the dirigeants. "In principle", it may not be applied to a breach already identified (pt 74). A fund cannot run both calculations and file the cheaper one.

Third, where several breaches are simultaneous (closely linked, with the same origin or nature and overlapping periods), the fund may net the regularisation results across them (pt 87). It must be able to show the netting cost neither the fund nor its investors anything (pt 88). Breaches that fail that test are calculated one by one (pt 86).

The FAQ tests this machinery twice, and both answers point the same way. A fund may not net negative deposit interest between banks. It is indemnified for the interest and charges it actually bore, on the accounting method, unless the §5.5.3.2 conditions above are met (FAQ Ch. III, Q4). A fund may mix methods within one UCI only where the policy says in advance which method attaches to which breach type (Q5). Both are policy questions answered before the breach, not calculation questions answered after it.

When does a breach also become a NAV error?

One route into Chapter 4 is often missed because it starts elsewhere. An investment-rule breach becomes a significant NAV error in its own right where subscriptions or redemptions were executed at an erroneous NAV during the breach period (pt 90). The circular puts the test on the fund. For every instance of active non-compliance, it must check the impact on all NAVs struck during the breach period against that sub-fund's tolerance threshold (pt 91). Where the threshold is exceeded, it must recalculate and correct the NAV for each day it was exceeded, under Chapter 4 (pt 92).

A breach remediated in the portfolio is not finished until that test has run. The same double test runs through two "other errors" in Chapter 6: swing-pricing errors (Tables 6 to 8) and cut-off errors. For cut-off, pt 110 makes the fund verify that its correction did not itself produce a significant NAV error.

Why fee errors carry no threshold

Fee errors work the other way round, and this is where the exposure sits. Where a UCI paid too much in costs or fees, pt 104 says the charging "is an error which must be corrected and for which the UCI must be compensated". It then states that "the tolerance thresholds provided for in Chapter 4 do not apply in this case". There is no materiality filter on an overcharge. No tolerance threshold filters it, so the full amount goes back; the only exception is an amount below one monetary unit (pt 127). Chapter 4 switches on only if that compensation itself causes a significant NAV error.

Underpaid fees (pt 105) have two routes. Either the party that caused the error pays the shortfall from its own assets, or the UCI recovers it retroactively from fund assets. On the second route the fund must correct the erroneous NAVs across the whole error period "without applying the tolerance threshold". It must also ensure the cost falls only on the investors who received the service. Either way, "it's below our threshold" is not an answer to a fee error.

Chapter 6 is the source of four of the six notification form types: swing pricing, non-compliant payment of costs/fees, cut-off, and investment allocation (pt 94). Two framing points are easy to skip. Point 95 sets the escalation. On discovery, the procedures must inform the IFM, the UCI administrator and the depositary without delay. The UCI and IFM dirigeants must be informed well enough to perform their Chapter 3 role.

Point 96 covers everything else. For other errors in the UCI's activities and operations, the lack of specific guidance in the circular removes nothing. "At every occurrence" the UCI must assess whether corrective actions and compensation for the UCI and/or investors are required. No error falls outside Chapter 6 because it lacks a named category.

The four named types differ on the question that decides the response: does the tolerance threshold filter this error at all?

How are swing pricing and other dilution-tool errors corrected (pts 97-100)?

Three tables cover three failure modes, and not all of them cost the fund money. Table 6 covers a swing factor that was not applied at all. The fund was unprotected from dilution. Its loss is the net variation in capital multiplied by the difference between the NAV applied and the NAV that should have applied. The fund is compensated. Table 8, an insufficient factor, works the same way on the shortfall.

Table 7 is the one most often misread. Where the factor applied exceeded the one set for the fund, the fund was over-protected and suffered no loss, so no compensation to the fund is required. In all three cases some investors gained and others lost, depending on the direction of the swing. The investor leg runs the same test: below the tolerance threshold, no compensation for capital activity; above it, the full Chapter 4 correction.

Point 100 widens the section beyond its title. The same guidelines apply "in a similar manner" to errors in other dilution-management tools, taking each tool's specifics into account. The circular names the anti-dilution levy and liquidity fees reflecting the cost of the fund providing liquidity. It also names commissions charging investing or divesting investors the transaction costs, taxes or other elements, as a lump sum or calculated individually. A fund that runs an ADL rather than swing pricing is inside §6.1 whatever its prospectus calls the mechanism.

Which fee errors fall under Section 6.2 (pts 101-105)?

Section 6.2 has a boundary that decides which regime applies, and it is not about size. Point 102 carves out costs and fees that were merely provisioned and never effectively paid by the UCI. Those are outside Section 6.2 entirely, and a significant provisioning error is treated as a plain significant NAV calculation error under Chapter 4. Section 6.2 applies once money has actually left the fund.

That distinction drives the FAQ's three worked examples (Ch. IV, Q1). An accrual booked in good faith on reliable information is not a fee error. A wrong accrual caught before payment engages neither Section 6.2 nor Chapter 4 if no significant NAV error resulted. A wrong accrual that was paid out does engage Section 6.2. Check whether the fee was paid before checking anything else.

What does a cut-off error trigger (pts 106-111)?

In a cut-off failure, orders submitted in due form were executed on the wrong NAV (pt 107). The NAV used was earlier or later than the one the constitutive documents and prospectus entitled the investor to. Correction under pt 108 covers all the orders executed on the erroneous NAV, and splits the same way as a NAV error. Investors who realised a gain keep it, and the fund is compensated for the difference between the erroneous and corrected NAV. Investors who lost are compensated by the fund, either through additional units or by paying the difference.

Clawback follows the usual line. A well-informed or professional investor may be asked to repay amounts unduly received; for anyone else it is "in principle not appropriate".

Two checks then run on the correction itself. Point 110 makes the fund verify that the corrective actions did not themselves produce a significant NAV calculation error requiring Chapter 4 treatment. Point 111 can open a second file. The UCI must also verify whether the incorrect cut-off breached Circular CSSF 04/146 on the protection of UCIs and their investors against late trading and market timing. If so, that circular's provisions apply as well. A late order accepted at a stale NAV is a cut-off error under 24/856 and potentially a late-trading matter under 04/146; the two are not alternatives.

How is an investment allocation error remedied (pts 112-115)?

This is the named type with no threshold and the least written about it. Point 113 gives three worked cases. A security meant for sub-fund A of a UCI is booked to sub-fund B. A security meant for UCI X is booked to UCI Y. Transactions, with currency hedging as the circular's example, are allocated to the wrong share class.

Point 114 explains why that is a loss and not a bookkeeping fix, and it names two separate harms. The fund is exposed to the risks of an investment it should never have held. The exposure starts when the position is recorded for its benefit in the administrator's books or its depositary accounts. And the fund does not get the performance of the investment the manager intended for it, because that investment went to a third party.

Point 115 sets the remedy. The UCI must be compensated for the loss on the wrongly allocated investments. Where those investments generated a profit, the fund keeps it. Where the allocation error caused a significant NAV calculation error, Chapter 4 applies on top. A share-class hedging misallocation corrected in the books with no impact calculation, and no threshold test on the NAVs struck in between, is an incomplete correction.

The CSSF's feedback report adds three points (CSSF Feedback Report, 5 October 2026, section 3.3). The impact is the difference between the price paid or received and the market price when the error is corrected, by analogy with pt 76. Reversing the booking at the original price, with no impact calculated per sub-fund, is not accepted. An investment booked to UCI X instead of UCI Y needs two notifications, one for each UCI. And buying or selling the wrong instrument is not an allocation error; it is corrected, and reimbursed where needed, under pt 96.

Every significant error goes to the CSSF on its prescribed notification form. The form is filed in full, with all fields completed and the quantitative impact calculation attached. The CSSF refuses an incomplete filing, so a half-finished form does not stop the clock.

There are exactly two permitted transmission channels, and email is not one of them. The first is initial submission and follow-up through the dedicated eDesk procedure. The second is automated submission via API on the S3 protocol, with the follow-up still done in eDesk. Both went live in production on 1 January 2025, after a familiarisation period on eDesk PREPROD (CSSF communiqué, 17 December 2024).

The exclusivity is the CSSF's own word. Its procedure communiqué of 31 December 2024 states that any detected error or instance of non-compliance "need to be notified exclusively through the two transmission methods" above. A PDF emailed to a usual CSSF contact is not a notification. Where the form cannot carry everything needed to understand the error, the additional explanations go in a separate document sent with the form (pt 156), not as a later supplement.

"The form" is really six typed forms, and the filer picks one per incident: NAV calculation errors, non-compliance with investment rules, and four kinds of "other error". Those four are incorrect swing pricing or anti-dilution tool, non-compliant payment of costs/fees, incorrect cut-off application, and investment allocation errors (practical guide §2.1). Each carries its own field set in Annexes I to VI, and its own JSON section for API filers.

The unit of filing is narrower than many expect: one notification covers one sub-fund of one UCI. The JSON report is defined that way, and the eDesk form makes the filer select fund and sub-fund before it opens. Standalone funds file under "sub-fund 0". An umbrella that applied the same wrong FX rate across five sub-funds files five notifications, not one, and each needs its own impact calculation. Plan the time accordingly.

The deadline is 4 to 8 weeks from the date of detection, not from the error date and not from when compensation finishes. Pt 158 is drafted unusually. The 4 to 8 week window appears in the sentence about an error "which does not entail the payment of compensation to investors". Complex cross-border compensation cases are then told to report "within the above deadlines", without necessarily naming the investor-payment date.

So the window is universal. Only the payment date may arrive late, through the completed form, with monthly progress updates to the CSSF while payouts run. The CSSF's own filing guide removes any doubt. It expects a complete notification "in principle, within 4 to 8 weeks of the detection of the incident".

When can a pre-notification replace a complete notification?

The form has two modes, and the circular does not spell this out. The CSSF's practical guide, UCI notification in accordance with Circular CSSF 24/856 (v1.2, 16 July 2025), sets out a pre-notification. It is for cases where the recalculation and compensation work genuinely cannot be finished inside the window. It is not a soft option:

• Pre-notification "can only be used on an exceptional basis in duly justified cases" where the correction is "particularly complex and time-consuming". The filer must describe the error's typology, duration and estimated impact, and justify why it cannot be finalised in 4 to 8 weeks.
• The CSSF can refuse it. A filing in the "Pre-notification refused" status means the justification did not qualify. The filer must then create a new complete notification from scratch, and the clock has kept running. An accepted pre-notification moves to "Pre-notification to be finalised", and the filer completes the same notification rather than starting again.
• While compensation is being paid, the filer reports progress to the CSSF monthly. Until the eDesk pre-notification form is updated, these updates go by email to [email protected]. An accepted pre-notification is finished under its original reference number, not refiled as a new notification (CSSF Feedback Report, 5 October 2026, section 4).
• The impact calculation sheet, in Excel, is mandatory for a complete notification. Other supporting documents go in as PDF. This is the pt 154 quantitative impact calculation in practice.

What does the NAV-error form ask for?

It helps to know the fields before opening the form.

• The tolerance threshold applied, validated as a figure between 0% and 5%. The pt 35(d) cap is enforced in the form itself.
• The detection date and the error period.
• A separate "period of significant impact" start and end. Alternating significant and non-significant days are reported as one outer span, not day by day.
• The nature of the error from a fixed list: securities valuation, accounting, fees and accruals, corporate action, derivatives valuation, other.
• The maximum impact as a percentage of NAV.
• The amounts owed to the sub-fund, to investors in cash and to investors in units, separately.
• Whether a de minimis was applied, at what level and in which currency.
• The payment dates.

The form has no dedicated field for the compound or non-compound method (pt 47). The guide asks the filer to state it in the free-text "other information" box.

Who can file, and what happens on a change of provider?

Access is often the first obstacle. The filer needs an eDesk account with LuxTrust authentication, linked to the notifying entity. The fund, the IFM and the UCI administrator can each create notifications, and none can edit a notification another entity submitted. A fund or IFM may delegate creation and submission to a named person at another entity. The invitation expires in 72 hours if not accepted. The UCI administrator cannot delegate.

On a change of IFM or administrator, neither the outgoing nor the incoming party can see the other's filings for that fund. The notification history does not travel with the mandate. Keep your own copies; the form exports to PDF at any status.

What else belongs on the filing checklist?

• Notify even when nobody was paid. A significant NAV error with no subscriptions or redemptions in the error period, and so no compensation due to investors or the fund, still requires a notification. The form must state the source of the error and the corrective measures taken to stop it recurring (FAQ Ch. II, Q1). "No money moved" is not a reason to skip the filing.
• The auditor's special report, where one is triggered, is due to the CSSF within 3 months of the complete notification (pt 157). If it slips, the CSSF must receive monthly updates on its progress, the same cadence as compensation payments (pt 158). It goes into the same eDesk notification as a new version, not as a fresh submission. What triggers it, and what it checks, is set out under the auditor's role below.
• The file stays open after submission. A complete notification can come back with CSSF comments ("Actions required"). Each comment topic must be answered before any new version can be sent. The named contact person, by default whoever created the notification, receives the emails. If staff change mid-remediation, change the contact on the notification, or the CSSF's questions go to an unwatched inbox.
• The CSSF does not pre-approve remediation, and silence is not clearance. Point 159 says the corrective actions in the form "are not subject to the CSSF's approval" and that the CSSF "will not provide specific feedback" on a notification. Filings feed its risk-based supervision instead. Point 160 lets it act afterwards. It may request more information or require different remedial actions where the fund's own actions depart from the guidelines. It may also demand organisational fixes where the notifications point to deficiencies. Host-country regulators of any market where the fund is distributed must also be informed under their local rules (pt 161).

Which guide version does this page use?

This page takes its point numbers, thresholds, deadlines and FAQ answers from the official English circular PDF and the FAQ PDF. The form and eDesk mechanics come from the CSSF practical guide, Version 1.2. The guide's own update table dates v1.2 16 July 2025, while the circular's CSSF page lists it as updated 17 July 2025. That is a one-day publication gap, not a difference in substance.

The guide's update table records exactly three rows. 01/01/2025 v1.0 is the "Initial version". 31/01/2025 v1.1 added delegation, replies to CSSF comments and change of contact person. 16/07/2025 v1.2 added feedback messages NAV011, BRE014, OSP014, OCF014, OCO014, OCO015 and OIA014. The CSSF document page still reads "31 December 2024, updated 17 July 2025, Version 1.2", with no successor.

This page does not reproduce the full field-by-field synopsis for the five non-NAV notification types (investment-rule breaches, swing pricing, costs/fees, cut-off and allocation errors). Nor does it reproduce the JSON schema and S3 naming conventions for API filing. Go to the guide's annexes before a live filing.

One cross-reference in the guide is wrong. Its §1.2 says errors "must be notified to the CSSF in accordance with the procedures laid down in chapter 8 of the circular". Notification is Chapter 9 of the English circular; Chapter 8 is the réviseur d'entreprises agréé regime. It reads as a drafting slip in the guide, not a change of substance, and the wording is unchanged in v1.2. It matters only when searching either document by chapter number.

Recalculate the NAV for every date in the error period. Compensation is compulsory only for the dates on which the error was actually significant (pt 39). Direction matters. An undervalued NAV means compensating redeeming investors and the fund; an overvalued NAV means subscribing investors and the fund (Tables 4 and 5). The financial impact runs on a compound or non-compound method. Pick one in the procedures and apply it consistently (pt 47).

Point 40 turns that into the remedial action plan the CSSF expects to see in the notification form. It works as a checklist, in the circular's order.

• Identify the origin precisely and correct the source immediately, so the next NAV is right.
• Determine the corrected NAVs across the error period.
• Apply them to the subscriptions and redemptions executed on erroneous NAVs, to size what is owed to the fund and to investors.
• Book the resulting payments to be received and made in the fund's accounts without delay, as soon as those numbers are final.
• Inform the investors being compensated, including the modalities.
• Pay.
• Decide and implement the control fix that stops it recurring. The circular's words are "adjustment or strengthening of internal controls".

Stopping further errors comes first; sizing the loss comes second.

Who funds the payout is a separate question from who owes it, and pt 43 draws the line tightly. Investors may be paid out of the fund's own assets only where the amounts due match excess amounts already in those assets. Paying them then cannot affect the other investors. Otherwise the IFM, the UCI administrator or another party involved in the fund takes over the payment.

Two mechanics sit alongside it. Where one investor both gained and lost across several transactions during the error period, the final compensation for that investor may be set on a net basis. That is allowed only where the fund can establish it is the same final beneficiary through the intermediation chain (pt 45). And the fund must still be made whole for whatever investors kept and was not recovered (pt 46). Amounts unduly received and not clawed back are compensated to the UCI.

The compound and non-compound methods need defining, because the notification form has no field for them and the CSSF's guide asks for the choice in free text. The compound method corrects each NAV in the error period for the direct effect of the error. It also corrects for the indirect effect of cumulative subscriptions and redemptions themselves executed at erroneous NAVs. The non-compound method ignores those cumulative effects. Both are permitted. The method must be set out in the fund's internal policies and procedures. Where both may be used, the policy must specify the circumstances for each, so cases are treated consistently (pt 47).

How does de minimis work?

A de minimis amount is a per-investor floor below which no compensation payment is made. It determines whether a small cash compensation amount is paid; it does not change whether the error was significant. Under 24/856 it is a lump sum reflecting the actual bank charges of transferring the compensation, documented per fund or sub-fund (pts 124-127). Two hard limits apply:

• It applies to investor payouts only, never to amounts owed to the fund. Money owed back to the fund is paid in full, unless the amount is lower than one monetary unit (pts 124-127).
• Compensation paid by allocating extra units rather than cash does not use de minimis at all (pts 128-129).

The FAQ adds the operational detail the circular leaves out: you do not need CSSF approval before applying de minimis (FAQ Ch. V, Q1). The CSSF can ask the fund to justify the level afterwards and to evidence that it genuinely represents the bank charges. It names EUR 25 as the level above which it will expect that evidence. The IFM's internal policy must set out the use and level of de minimis for NAV errors. An undocumented de minimis is likely to become an inspection finding.

De minimis limits a payment, never a notification. The CSSF confirms there is no de minimis for notifying a non-compliant fee payment: every instance is notified, whatever the amount. It says it is assessing the framework because many of these filings concern small amounts (CSSF Feedback Report, 5 October 2026, section 3.3).

How do you pay investors who hold through intermediaries (pts 120-122)?

Readers often search for this passage by number, and it is the one that turns a compensation calculation into a project. Most end investors are not in the register. The financial intermediary is, on their behalf, often with capital activity aggregated across several investors up the chain (pt 120). Point 121 says the UCI must still ensure the final beneficiaries receive what they are owed. It must have arrangements to trace back the intermediation chain, so that compensation reflects each beneficiary's individual position and actual loss.

Point 122 is the fallback when that is impossible. Give the intermediaries the full data set: error period start and end, erroneous and corrected NAV per day, subscriptions and redemptions per day, and impact per day. They can then compensate their own clients. Tell investors clearly that final beneficiaries' rights may be affected when compensation is paid where they subscribed through an intermediary.

For any UCI that must issue a prospectus, that warning belongs in the prospectus, at the next update (pt 164). That covers UCITS, Part II UCIs, MMFs and ELTIFs, and SIFs and SICARs where they still issue units to new investors. A fund with no prospectus obligation, or one that has not yet updated, still owes the information. Pt 164 requires it to reach investors "via the official and usual communication channels" named in the constitutive documents or prospectus.

Two related constraints apply. Compensation may not be paid in instalments, nor deducted from future remuneration owed to the party responsible for the error (pt 118). Where compensation cannot be paid without delay, the dirigeants must tell the CSSF why, through the annexes to the notification form (pt 119).

What about clawback, unclaimed amounts and correction costs?

• Clawback from investors who accidentally gained is acceptable for well-informed or professional investors, but "in principle not appropriate" for retail (pt 44).
• Unclaimable amounts owed to investors who have since left go to the Caisse de Consignation. Formally this is the State Treasury's Consignment Office (Trésorerie de l'État, Caisse de consignation), Luxembourg's deposit office for unclaimed funds. The fund files a consignment request under Article 1(2) of the Law of 29 April 1999 on consignments to the State. It may do so only after "all necessary efforts", additional research included, have failed (pt 132).
• The costs of running the correction cannot be charged to the fund (pt 133). The party that caused the error carries the remediation cost, not the NAV. The circular closes the two obvious workarounds. "Direct and/or indirect" costs are caught, with staff time at the IFM or UCI, legal fees and the auditor's special report named explicitly (pt 134). And the costs may not be recharged indirectly through an increase in the fees the fund bears (pt 135). In cost terms, this is the most expensive sentence in the circular.

Where Chapter 8 applies, the fund's réviseur d'entreprises agréé (REA), its approved statutory auditor, sees every error by one of two routes. Vehicles brought in through pts 2 to 4 are outside Chapter 8, and closed-ended NAV errors follow the statutory-audit check in pt 27. The route decides how quickly the fund must contact the auditor.

The power behind Chapter 8 is statutory, not created by the circular, which is why an engagement letter cannot change it. Article 154(3) of the UCI Law, Article 55(3) of the SIF Law and Article 27(3) of the SICAR Law share one power. Each lets the CSSF require a UCI's REA to control particular aspects of the fund's activities and operations. Points 136 and 137 are the CSSF using that power as a standing request, for every fund with an error or instance of non-compliance in scope. The REA performs the controls when it draws up its 21/790 separate report.

The default route is the separate report the REA already produces each year under Circular CSSF 21/790. The REA reviews the errors reported to it during the financial year on a risk-based sample, against procedures the CSSF sets directly in that report (pt 141). For those cases the information must reach the REA "at the latest" when it starts its year-end work (pt 139). The end of the audit cycle is soon enough.

Point 165 promised that the 21/790 procedures would be rewritten to take 24/856 into account, and they were. The change came not through a new circular but inside the eDesk report templates. The CSSF set it out in a communiqué of 3 February 2025, for year-ends from 31 January 2025. The direction is a loosening, and it is quantified. The separate report previously reviewed all errors and instances of non-compliance for UCITS, Part II UCIs and SIFs. It now runs a sample-based review, with the sample fixed by vehicle and SICARs added.

The self-assessment questionnaire moved the same way. Its "Investment compliance" section lost the question asking for the number of active instances of non-compliance. It gained one on the appropriate classification of the passive ones. Its "NAV determination" section was widened to cover Chapter 6's other error types, and the compensation arrangements for investors who subscribe through intermediaries.

Read together, the changes move supervisory attention off the count of errors and onto the active/passive classification. The judgement a fund makes to keep a breach away from the CSSF is now what both the questionnaire and the auditor's sample test. A single sampled item for a SIF is not a light check if it is the breach the fund classified optimistically.

The templates changed again a year later, for year-ends from 31 January 2026. The CSSF's communiqué of 10 February 2026 removed six separate-report procedures. They sit in the investment compliance, valuation, NAV determination and disclosure sections; the NAV determination removal concerns the policy framework for liquidity management tools (anti-dilution levy, swing pricing and gating). None of them is a 24/856 sample in the table above. The communiqué does not mention 24/856, NAV errors or the samples. It adds that some other procedures had "targeted adjustments", including "the reduction of the sample size", without naming them. The table above is therefore the last published (2025) set of samples.

The Annual Report 2025 records the questionnaire side: new specific questions "at the level of the valuation sections and costs/fees", certain questions deleted, and the guidance behind others reworked. The questions around the samples have changed; whether the 24/856 sample sizes changed is not published. Costs and fees, with 416 filings in 2025, are now asked about in both the questionnaire and the notification forms.

The exception is the special report, and it runs on a different clock. It is triggered where both conditions in pt 138 are met. First, the error or breach relates to a UCITS or a Part II UCI. Second, the total compensation exceeds EUR 50,000 or the payout to a single investor exceeds EUR 5,000. Compensation paid to the fund and to all investors counts together for the EUR 50,000 test.

The control "must be performed immediately after the detection of the error". The report goes to the UCI dirigeants and the CSSF. The fund or IFM must ensure the REA is informed "without delay" and given everything it needs. The trigger is detection, not filing, so on a large error the auditor call belongs in the first week, alongside the notification work.

Tables 9 to 11 of the circular set out who reviews what.

Two asymmetries in the tables deserve attention. For investment-rule breaches, the EUR 5,000 single-investor trigger applies only where the breach exceeded the NAV tolerance threshold. That is the footnote to Table 10, and the only place the threshold returns to the auditor question.

And passive non-compliance, which never reaches the CSSF (pt 55), still reaches the auditor. Table 10 puts it in the separate report on a sample basis for UCITS, Part II UCIs, SIFs and SICARs alike. Pt 143 states that the REA samples "the adequate classification of instances of 'passive' non-compliance". The classification made to avoid a filing is the one that gets tested.

The separate-report checks are what one would expect. For NAV errors, they cover investors identified from the register, NAVs corrected across the error period, amounts owed derived from the corrected NAVs, and payment actually made (pt 142). For breaches, they cover the gain or loss calculation and the impact method's consistency with the circular and the internal policy. They also cover payment, and whether the breach produced a significant NAV error (pt 143). The special report's five additional checks (pt 147) follow the costliest points on this page.

• Compliance with the Chapter 7 financial-intermediary guidelines when compensating investors (the pts 120-122 trace-back).
• Verification that the fees and costs of the correction were not charged or recharged to the fund. Pt 133 and pt 135 are audited, not self-certified.
• Assessment of whether the de minimis rule was adequately applied, both its level and the bank charges behind it.
• Verification that the notification to the CSSF was adequate, "including the exhaustiveness of the content".
• Verification that a root-cause analysis was performed and corrective measures taken.

Note what the outputs are not. The separate-report procedures are reported as answers to a set of mainly closed questions, and they "do not result in an opinion" under any auditing or assurance standard (pt 145). A clean answer set is not an audit opinion that the remediation was right. Every one of these checks tests a policy the fund was supposed to have written before the error.

The FAQ is short, but each answer closes a real operational gap. The day-one summaries of the circular did not cover it, because most of it did not exist until 24 December 2024.

The FAQ cited throughout is Version 1 (24 December 2024). Its own update table records a single line, "24.12.2024 Version 1 – First publication", and every page carries "Version 1 – 24 December 2024". The CSSF FAQ page and the circular's document page both list Version 1 as the only FAQ. Twenty months after entry into force there is no Version 2. The FAQ itself states that the CSSF may add questions or adapt positions at any time, so re-check it before relying on an answer.

What does the CSSF's 2026 feedback report add?

On 5 October 2026 the CSSF published a Feedback Report on Circular CSSF 24/856, with a communiqué of the same date. It is not a new FAQ version; the FAQ remains Version 1. The report sets out the 2025 filings and the observations "which the industry should duly consider when notifying the CSSF". The positions below are the CSSF's reading of the circular, not amendments to it.

Source: CSSF Feedback Report, Circular CSSF 24/856, sections 3 and 4.

The CSSF published its Annual Report 2025 on 4 September 2026. Its section 4.1.2 is the first full-year picture of what this circular produced: the filings, the compensation and the breach mix, as at 31 December 2025. The report states the totals for 2024 and 2025; the 2023 total in the table above is that year's two categories added together.

Filings rose 44.87% in a single year, and the report attributes the rise mainly to the error type 24/856 created. With 586 cases, "other errors" made up 26.42% of all 2025 declarations. Of the 2,218 declarations, 190 were still made under 02/77, for errors detected before 1 January 2025 and so running on the old regime under pt 163. 2,028 were made under 24/856. NAV calculation errors, the subject in the circular's title, were 239: barely a tenth of the total and flat on 2024. The volume is in the other two categories.

Costs and fees alone produced 416 filings, 19% of everything the CSSF received in 2025. That is a larger category on its own than NAV errors. It is also the section where the tolerance threshold is expressly disapplied (pt 104), so "it was below our threshold" stopped none of them. The largest new reporting burden of 24/856 therefore sits with whoever checks the fee accrual against the prospectus, not with the NAV oversight team. The day-one summaries treated this part as a footnote.

The auditor numbers point the same way. 105 special reports reached the CSSF in 2025 (76 under 24/856, 29 still under 02/77), against 107 in 2024. That is a 1.87% fall in the first year the trigger doubled. Under 02/77 it was EUR 25,000 total / EUR 2,500 per investor; pt 138 sets EUR 50,000 / EUR 5,000. A fund that expected the higher trigger to take it out of the special-report population should note that, across the market, it did not happen in year one.

The CSSF adds a finding for anyone who treats the filing as the whole exposure. Reviewing 2025's closing documents, it found non-compliance and NAV calculation errors at several UCIs "which had not been identified by the management bodies, the IFMs and/or the service providers". They were then handled under 24/856.

Source: CSSF Annual Report 2025, section 4.1.2. The CSSF flags two limits on these figures itself. The 2025 data are incomplete, because final compensation amounts had not been settled on some files at 31 December 2025. The 2023 and 2024 rows are left as previously published rather than restated. And the "other errors" row for UCIs/sub-funds excludes amounts relating to costs/fees that proved insufficient against the instruments of incorporation and/or prospectus.

Two points follow from that table. Total compensation rose in 2025 only because the new error type was added to it. Without "other errors", the amounts fell 8.56% on 2024. And compensation for NAV errors has now dropped for two years running, to EUR 5.8m to investors from EUR 49.6m in 2023, while the number of NAV-error filings barely moved. That means fewer euros per error, not fewer errors. The CSSF's own summary is that the totals remain low against assets under management.

Source: CSSF Annual Report 2025, section 4.1.2. "UCI Law" is the report's "2010 Law". The SFDR line is a subset of the 573 and is not added again in the total. Grouped as the report groups them, the 1,393 is 573 policy breaches, 565 breaches of UCITS legal diversification, holding and borrowing limits (the Art. 43(1), 50(2), 43(2), 46, 41(2), 45(1), 48(2) and 43(3) rows), 77 eligibility breaches (71 in 2024) and 178 spread across other rule types.

The top line matters most. The most-breached rule in Luxembourg is not a legal limit. It is the fund's own investment policy as written in its sales documents: 573 instances, up 37.74% on 2024. Breaches of the statutory UCITS limits fell 13.61% to 565. And 210 of those 573 are SFDR: assets acquired that the fund's own ESG commitments did not allow, or disclosure-driven limits missed. The CSSF attributes them to internal control failures, human error and ineligible acquisitions. The rules most often breached are the ones funds drafted themselves, and under pt 49 they are tested exactly like the statutory ones.

Read the circular and the FAQ as one document, because the FAQ decides most of the money questions. The circular gives the thresholds and the form. The FAQ adds four points. A lower internal threshold binds you, and "nobody was paid" still means "file". A settlement-mismatch deposit breach is the fund's responsibility, not the market's. And de minimis above EUR 25 will be questioned.

Two filters decide whether any of the machinery runs, and both are the fund's to justify rather than assert. The first is the tolerance threshold for NAV errors. The second is the active/passive classification for investment-rule breaches. Only the second removes the CSSF filing entirely (pt 55), which is exactly why the FAQ spends a third of its questions narrowing it.

Neither filter reaches most of Chapter 6. The threshold is disapplied outright for a fee overcharge (pt 104) and for a cut-off failure (pt 109). It never appears in the allocation-error section at all. "Below our threshold" is the wrong first question for three of the four other error types. The costliest single line remains pt 133: correction costs cannot touch the fund. The cheapest remediation is therefore a control evidenced before the error, and a de minimis documented before it is needed.

Two misreadings are common. First, the 4 to 8 weeks is a window for a complete filing. Second, the pre-notification is not a deadline extension the fund grants itself. It is a request the CSSF can refuse. A refusal does not give the time back; it sends the fund to a fresh complete notification with the clock already spent. Treat a pre-notification as an escalation to justify in writing on day one, not a fallback for week seven.

Nothing in the circular has changed since it took effect, but the texts it points at have. Point 49's risk-spreading reference went with Circular 07/309 in December 2025. Circular 22/811, the source of the administrator's error-handling duties in pt 23, was amended the same week to point at 24/856 instead of the repealed 02/77. The last of IML 91/75 went in May 2026, taking with it the circular-level statement that UCITS investment limits apply to net assets. 24/856 has not been reissued in any of the three cases, so the reader has to reconcile the cross-references; the changelog below records them.

One cross-reference moved the other way, early. The 21/790 separate-report procedures were rewritten for the circular in February 2025, exactly as pt 165 said they would be. It is the only text in the chain that changed because of 24/856 rather than around it.

What has otherwise changed is the level of supervisory attention. The CSSF's 2026 priorities for supervising the investment fund sector (31 March 2026) put valuation near the top under "asset valuation risk". They plan on-site controls on IFMs' valuation organisation and thematic sample-based reviews of open-ended private-assets funds, including continuation funds. They add that "the correct implementation of Circular CSSF 24/856" will be monitored by the CSSF. The sentence covers "NAV calculation errors, instances of non-compliance with the investment rules and other errors at UCI level".

The consequence is a change of emphasis, not of rule. The internal policy 24/856 keeps deferring to is now more likely to be read in an inspection. That covers the documented threshold analysis under pt 35(d), the impact method fixed from launch under pt 72, and the use and level of de minimis under pts 124-127. The CSSF could always request the pt 35(d) analysis (pt 35(d)(iii)); the 2026 priorities add supervisory emphasis.

That priority has already produced follow-up work. See the CSSF's Feedback Report on its thematic review of the valuation framework for less liquid and illiquid assets (4 June 2026). It asks every IFM to benchmark itself against the report's observations. Where it falls short, it should take corrective measures. It never mentions 24/856. It concerns the framework that produces the NAV, not what happens once the NAV is wrong. But an inspection opens the same file, and the 2025 figures show the CSSF already finding errors in closing documents that nobody in the chain had flagged. If the policy has never been written down, a supervisor should not be its first reader.

In Ireland, the UK, Jersey and Guernsey the thresholds for the same NAV error are lower, absent or left to the depositary. For the comparison, see the NAV error correction matrix.