Modernisation of SCS /SCSp Toolbox — Compartmentalisation
On 30 July 2026, a bill 8814 was in the Luxembourg Parliament aiming to amend the Luxembourg law of 12 July 2013 on alternative investment fund managers by inserting a new Article 28bis. Its purpose is to permit Luxembourg alternative investment funds constituted as an SCS or SCSp, but not governed by a specific product law, to operate as multi-compartment funds. The measure is intended to modernise Luxembourg’s fund toolbox and improve its competitiveness, particularly for parallel-fund structures replicating foreign vehicles such as US Series LLCs.
The option would be available only where the SCS or SCSp qualifies as an AIF and is managed by an authorised Luxembourg AIFM or an authorised AIFM established in another EU Member State. This appears to exclude structures managed solely by a registered sub-threshold AIFM. The constitutional documents must expressly provide for the compartment structure and its operating rules and describe the investment policy of each compartment.
Each compartment would constitute a distinct pool of assets. By default, investors and creditors of one compartment would have recourse only to that compartment’s assets, and each compartment would be treated separately between investors. However, the constitutional documents may provide otherwise; statutory segregation is therefore not absolute, making careful drafting critical.
A compartment may be liquidated without affecting the others; only liquidation of the final compartment liquidates the AIF. Cross-investment between compartments is permitted, provided there is no reciprocal investment by the target compartment and voting rights attached to the relevant interests are suspended. Separate annual reports may be prepared per compartment but must contain aggregated information for the entire AIF.
The proposal does not alter the existing RAIF, SIF, SICAR or Part II UCI regimes, whose specific rules prevail. In practical terms, it creates a flexible, non-product-law umbrella partnership, but only under an authorised AIFM. The bill records no direct State-budget impact; the CSSF and ALFI were consulted.
Should you have any questions regarding Bill 8814 or wish to assess how the proposed compartment regime could impact your structure or simply launch an investment vehicle in Luxembourg do not hesitate to contact us. Our team would be pleased to assist with the structuring, regulatory analysis and drafting of the relevant documentation.
