DLT and issuance of dematerialised securities in Luxembourg

The bill of law no 7637 modifying the Luxembourg law of 5 April 1993 on the financial sector and the law of 6 April 2013 on dematerialised securities (the “Bill”) has been adopted on 21 January 2021* and aims at modernising the existing legal framework for dematerialized securities, notably by explicitly recognising the possibility to use secure electronic registration mechanisms, including distributed electronic registers or databases, for the purpose of issuing dematerialised securities.

The Bill is a continuation of the law of 1 March 2019 modifying the law of 1 August 2001 on the circulation of securities which introduced  the transfer of securities through the use of secure electronic registration mechanisms, in particular where based on the technology of distributed electronic ledgers or databases. In line with the law of 1 March 2019, the Bill contributes to the efforts to promote innovation in the Luxembourg financial sector.

By legally expressly recognising the reality of distributed electronic ledgers or databases technology, the Bill aims at enabling the relevant actors to take full advantage, with more legal certainty, of the opportunities offered by these innovative technologies in the context of dematerialised securities while remaining technologically neutral.

In addition, the Bill intends to broaden the scope of application of the law of 6 April 2013 on dematerialised securities by opening the activity of central accountholder for unlisted debt securities to credit institutions and investment firms (as defined in the amended law of 5 April 1993 on the financial sector. In order to guarantee high quality and security standards, these entities must have adequate infrastructure, control and security mechanisms in place equivalent to those required for the authorisation as central accountholder (as set out in article 28-11 of the law of 5 April 1993 on the financial sector) to ensure a level playing field between the various actors.

The planned expansion will enable these entities to expand their range of services in the area of dematerialised securities, and will also enable issuers of unlisted debt securities to have recourse to a larger number of participants.

The Bill constitutes a new important step for the financial centre in its desire to meet the challenges and seize the opportunities of the digitalisation of the financial sector and the use of new technologies, and contributes to reinforcing the influence and attractiveness of the Luxembourg legal framework for the issuance and circulation of dematerialised securities.


* The Bill will only become effective once it has been published in the Luxembourg Official Journal.


Authored by: Ariane Mehrshahi, Valérie Laskowski and Agnes Merz.


Hogan Lovells Luxembourg LLP is registered with the Luxembourg Bar.



Ariane Mehrshahi
Valerie Laskowski
Senior Associate
Agnes Merz
Senior Associate


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