Luxembourg is the second largest investment fund center in the world after the U.S. Assets under management exceed U.S. $5.0 trillion. This largely is due to the advanced investment fund legislation and favorable legal framework for investors regarding pledged collateral. Earlier this year, the law was amended to reflect current market concepts. To illustrate, an enforcement event is now defined as an event of default or any other event that triggers an enforcement action as agreed between the parties. If an enforcement event occurs and the collateral consists of financial instruments that are traded on an exchange or market, the holder of the pledgee may, without prior notice (i) assign or cause the pledged collateral to be assigned on that exchange or market or (ii) appropriate the pledged financial instruments or have them appropriated by a third party, at market price. Also, execution on the pledge can be instituted when and as the parties have agreed in the pledge. A final legal determination against the pledgor is no longer a prerequisite for execution against the collateral. These and other aspects of the amended law are explained by Anton Baturin and Graham Wilson, members of Wilson Associates L.L.C., an international business law firm in Luxembourg.