The law introducing a new ready-to-go / simplified form of
private limited liability company ("S.à r.l.-S")
will enter into force on 16 January 2017.
This light capital vehicle aims at supporting young and new
entrepreneurs with limited financial means to start their activity
enjoying the advantages of limited liability, without having to
meet the capital formation requirements linked to the incorporation
of the ordinary private limited liability company (i.e the
S.à r.l.). The provisions governing this new corporate form
are outlined in this client briefing.
The idea to create in Luxembourg a
simplified private limited liability company is a longstanding
project to attract entrepreneurs and promote the development of new
The legal regime of the
société à responsabilité
limitée simplifiée or the "S.à
r.l.-S" allows the creation of small businesses with limited
costs and lightened formalities compared to a standard private
limited liability company.
The S.à r.l.-S is a
simplified Luxembourg private limited liability company whose
characteristics are as follows:
the document constituting the
S.à r.l.-S may be in the form of a private deed or a
notarial deed (i.e. the implication of a public notary is not
the share capital may be symbolic
as it may range between EUR 1 and EUR 12,000;
Only private individuals can
become shareholders of a S.à r.l.-s and one person cannot
become shareholder of more than one S.à r.l.- S;
Similarly, only private
individuals can become managers of a S.à r.l.-S;
the S.à r.l.-S shall have a
business licence; and
contributions may be in cash or in kind.
The corporate object of the
S.à r.l.-S must fall within the scope of the law of 2
October 2011 governing access to the professions of craftsman,
merchant, manufacturer and other independent professions, as
amended from time to time (the Law on Business
Licences) and shall have therefore a business licence for
the purpose of the activities permitted by such law and an
effective place of the operating activities with the relevant
infrastructure. The scope of the business activities is not
restricted as the law of 23 July 2016 on the S.à r.l.-S
(société à responsabilité
limitée simplifiée) (the Law)
does not provide with any limitative list of professions subject to
its application. In order to obtain such business licence, the
process may take a maximum of three months and the absence of
approval within that period shall be considered as an implicit
approval. Among the obligations applying to the S.à r.l.-S,
one of its managers shall comply with the experience, honourability
and qualifications required by the Law on Business Licences.
The articles of association shall
be in their entirety published with the Luxembourg trade and
The shareholders take decisions by
way of general meetings; decisions of the ordinary general meetings
are taken by a majority of the votes cast representing at least
half of the share capital of the S.à r.l.-S and decisions of
extraordinary general meetings are taken by a majority of
shareholders representing three quarters of the share capital,
unless the articles of association provide otherwise.
As for Luxembourg private limited
liability liabilities, the shares are freely transferable amongst
existing shareholders but any transfer of shares to third parties
requires the approval of shareholders representing three quarters
(can be lowered down to half) of the share capital and shall be
notified pursuant to the terms of article 1690 of the Luxembourg
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
When working with family businesses, it's sometimes surprising to see the gap between the founder and the next generation, particularly when the next generation do not see the importance of the business.
Luxembourg ranks as the largest EU fund domicile jurisdiction
and the second largest fund domicile jurisdiction globally.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).