BUSINESS CREATION
You want to create an entity in Luxembourg?
Céliance accompanies you in your incorporation project : a personalized assistance translating into the management of your company creation process.
Our team will help you analyze and go through each step of the creation process, until you receive a fully operational turnkey company.
Major steps to establish your company in Luxembourg :
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Drafting of statutes and opening of a bank account : choice of the legal form & establishment of the head office (physical address in Luxembourg)
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Authorization of establishment from the Ministry of Economy Registration with the trade and companies register (RCS)
- VAT and social security registrations : registration for the VAT with the Registration Duties, Estates and VAT Authority (AED) ; Social security registration with the Centre Commun de la Sécurité Sociale (CCSS)
Documents are required :
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Identity Document
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Proof of residence
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Extract form the criminal record
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Tax notice
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Notarial attestation of no personal bankruptcy
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Diplomas / Degrees
The reasons likely to convince you to settle in the Grand Duchy of Luxembourg and to set up your company there are not lacking: economic reliability, attractive taxation, financial and political stability, the Grand Duchy of Luxembourg indeed attracts many investors and entrepreneurs. An attractive place to live, it also offers an excellent balance between professional and private life.
The incorporation may involve the establishment of a commercial company, in order to meet a local market. However, the creation of a commercial entity in the Grand Duchy of Luxembourg supposes the respect of certain criteria, such as the notion of local economic substance, and regular presence on Luxembourg soil for example.
The analysis of your business creation project is crucial, since it is necessary to make sure, beforehand, that your incorporation project is in line with the legal framework in force. Céliance is here to listen to you and will guide you in your decision making, in order to be able to set up your activity in a serene and sustainable way.
Beyond the legal framework, it is also necessary to question the market, the ideal structure to set up, and the patrimonial repercussions resulting from the creation of your company. Our experts will be able to provide you with a complete analysis adapted to your incorporation project.
The creation of a company can also involve the setting up of a “holding” type company, known as SOPARFI (for financial participation company) in Luxembourg.
This type of company, unlike commercial companies, has a purely patrimonial vocation. Indeed, it is passive, and its purpose is to structure the patrimony of a person holding participations in one or several other entities, and/or holding real estate, movable, or even intangible assets.
The most well-known advantage granted to this type of company is the tax regime that can be derived from it, namely the benefit of the “mother-daughter” regime allowing the exemption of the net profit distributed by the subsidiaries, provided that certain conditions defined by the law are met.
It is also an excellent asset management tool, allowing to facilitate intra-group cash flow, but also to facilitate a need in terms of succession for example.
The constitution of a SOPARFI must also meet a certain number of criteria, as for the commercial company. Thus, the creation of a holding company in the Grand Duchy of Luxembourg will have to be legitimized, either by the presence of the economic beneficiaries on Luxembourg soil, or by the presence of substantial Luxembourg assets on the balance sheet of the holding company, ideally by the combination of both. Other criteria may be taken into consideration in order to satisfy the notion of Luxembourg economic substance.
Once again, the constitution of a holding company also requires a preliminary analysis by an expert. Our consultants will be able to offer you all the advice and recommendations necessary for your creation project, in order to structure your assets in an optimal way.
The creation of a company can also take other forms, for other needs. Thus, Céliance can assist you in the creation of your civil company (real estate or not), in the creation of your SPF (form of holding company, heir of the 1929 holding company, with a specific tax regime), in the creation of your SCSp, in the creation of your association, etc.
There are different forms of company in Luxembourg.
It is crucial, whatever the size or nature of your company, to opt for a legal form adapted to your activity.
In Luxembourg, there are several types of companies, such as :
- Civil Company (SC)
- Public limited company (SA)
- Public limited liability company (SARL)
- Simplified limited liability company (SARL-S)
- Partnership limited by shares (SCA)
- Limited partnership (SCS)
- General partnership (SNC)
Public limited companies (SA) and Public limited liability companies (SARL) are the two most common forms of company formation in the Grand Duchy of Luxembourg.
In the following companies, the liability of the partners is limited to the amount of their contributions.
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Public limited company (Société Anonyme)
Public limited company (SA) is often the legal form of company chosen by large businesses. It can also be used for SMEs, as the shares in this type of company can be bearer shares and are more easily transferable.
The anonymity of the shareholders is relative. The attraction for shareholders lies in the limitation of their liability to the amount of their capital contributions. The creation of a corporation is adapted for companies that would call upon investors, because the latter will be able to sell and buy shares freely. A minimum of one partner is required. One or more legal entities or individuals can form a corporation, which is itself incorporated before a notary. A minimum capital of 30 000€ is required. Contributions in cash or in kind are possible. In addition to the costs of creation, there are the notary fees, the costs of publication in the Trade Register, costs related to the issuance of administrative authorizations, and the remuneration of the auditor. The corporation may be dissolved by operation of law at the end of the term set out in its articles of association. It can also be dissolved by the shareholders or by a court decision for just cause. The act of voluntary dissolution must be accompanied by administrative certificates.
The legal audit of the accounts will have to be entrusted to an approved auditor, such as Céliance, when at the closing date of the balance sheet after 2 consecutive financial years, the company exceeds the limits of 2 of the 3 following criteria
– Balance sheet total of 4.4 million euros
– A net turnover of 8.8 million euros
– Number of employees (full-time), on average, of 50 people
For companies that do not meet these criteria, oversight by one or more auditors, whether shareholders or not, is mandatory.
The SA is obliged to produce: balance sheet, profit and loss account, annexes and management report. These must be approved by the general meeting of shareholders.
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Private limited liability company (SARL)
In Luxembourg, it is the most common form of company. It is particular because it has both the characteristics of a capital company (limitation of the responsibility of the associate to the amount of his contribution), as well as a partnership because the shares are not negotiable. It can be composed of 2 to 100 persons (natural or legal persons). Its constitution is possible with a single associate.
If the number of associates exceeds 100 it has one year to change its form. At the time of incorporation it can have only one partner. It should be noted that insurance, savings or investment companies cannot be created in this form.
It can be established for a limited or unlimited period of time, and must be notarized. The partners may decide to change the corporate form.
The SARL is required to produce a balance sheet, a profit and loss account (and annexes), and a management report.
The constitution of a SARL requires a minimum capital of 12 000€. If there is a contribution in kind, it must be valued in the statutes.
Its management can be ensured by one or several managers, who are partners or not, but appointed by the partners for a limited or unlimited duration. A legal person can be the manager of a limited liability company. If the number of associates is superior to 60, the general assembly must take place annually.
Drafting of the articles of association
Once this first step is over, Céliance advises you in the drafting of the articles of incorporation which must be written in French or German (in English under certain conditions). The registration of the articles of association of a SARL or SA must be carried out by a notary.
The purpose of the articles of incorporation is to establish the rules of operation, which constitute its fundamental charter.
The articles of incorporation must include the following elements: corporate purpose, business name, type of company, share capital, registered office, duration of the company’s life, the joint partners and managers, and finally the indication of the nature and limits of their powers. The notary will register the signed articles of association by notarial act with the Administration of Registration, Domains and VAT (AED). He will then file them electronically with the Trade and Companies Register (RCS) for registration and publication in the Electronic Registry of Companies and Associations (RESA). On the other hand, if the signature was done by private deed, the deposit will be done in the month of the signature at the RCS for the registration.
Authorization of establishment
In parallel to the creation of the entity, it is necessary to obtain an establishment authorization before starting any commercial, craft, industrial or service activity in Luxembourg. Our team also assists you in the application process.
The patrimonial activities are not subject to this obligation to obtain an establishment permit. These activities are generally carried out in SCI or within the framework of a SOPARFI or SPF tax regime.
Business plan
The drafting of a business plan is not mandatory when creating a company in Luxembourg, but it is a useful prerequisite for the constitution of the company to allow the entrepreneur to verify the profitability of his project and the cash flow needs that this project generates. The business plan is also a useful tool for customers, suppliers, bankers, investors and public administrations.
Registration with tax and social security authorities
Once you have obtained your establishment permit:
– If you plan to employ staff, your registration with the CCSS (Centre Commun de Sécurité Sociale).
– If you generate turnover and intra-community operations, it will be mandatory to proceed with the formalities for VAT registration.
Céliance will guide you through the administrative steps involved in setting up your company in Luxembourg. Thanks to our multidisciplinary approach and our experience, we can provide you with expertise in many fields and we work closely with all the partners required for the creation of a company.
Our team offers you various services related to the creation and domiciliation of companies. We study at your side the different steps of your incorporation project. We are at your disposal to understand and apprehend your needs.
Céliance helps you making your business creation project operational as quickly as possible and in good conditions! Our follow-up will allow you to save time and to benefit from many advices necessary to the constitution.
Beyond the constitution of your company, Céliance will also accompany you in the following aspects :
- accounting,
- tax
- social,
- and will also be able to offer you an address via our domiciliation or office rental services.