Luxembourg company law reform: the essential changes
10 August 2016
On 10 August 2016, bill nº 5730 (the Reform Bill), which amends and modernises the Luxembourg companies act dated 10 August 1915, was signed into law.
The Reform Bill came into effect on the fourth day following its publication in the Luxembourg official gazette, the Mémorial A (ie, on 22 August 2016).
A transitional period applies for pre-existing companies. They will have a period of 24 months within which to amend their articles in order to comply, to the extent required, with the new provisions.
The Reform Bill, which is the result of a ten-year legislative process, reinforces the current legal framework and is expected to further increase Luxembourg’s attractiveness as a hub for international investments.
On the one hand, it expressly confirms a number of existing practices, thus reinforcing legal certainty. On the other hand, a series of new mechanisms and instruments are introduced to respond to a more complex economic environment and with a view to increasing the flexibility of Luxembourg company law. The majority of the amendments concern the two most common company types, the public limited liability company (société anonyme) (the SA) and the private limited liability company (société à responsabilité limitée) (the Sàrl), but the Reform Bill also introduces new general principles and specific measures affecting other company types.
The purpose of this paper is not to present an exhaustive catalogue of all changes, but rather to focus on the most material ones that we believe will have a real impact on our clients’ businesses.
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