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Open a SPF in Luxembourg

Create a SPF in Luxembourg

Updated on Monday 16th January 2017

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SFP_in_luxembourg.jpgWhat is a Luxembourg SPF?

The SPF (“Société de Gestion de Patrimoine Familial”) was created in order to replace the previous “1929 Holding Company” and it’s an entity established in the form of a limited liability company, a joint stock company, a partnership limited by shares which is not involved in any commercial activity, except for the purchase, holding, management and transfer of financial assets.

What are the main characteristics of a SPF?

Every company registered as a SPF in Luxembourg must contain the termination SPF or “Société de Gestion de Patrimoine Familial”.

The main characteristic of a SPF is that it’s not allowed to perform commercial activities. Also, it can keep shares in a company but it may not intervene in its management.

The investors in a Luxembourgish SPF may be individuals acting under the management of their private assets or patrimonial entity acting solely in the interest of the private assets of one or more physical persons or an intermediary acting on behalf the previous type of investors.

An advantage of opening a SPF is the exemption of paying income tax, municipal business tax and the tax on wealth. The SPF is also not subject of the VAT.

Exemption to the above are represented by companies which have received at least 5 percent of the total amount of dividends from holdings in non-resident companies or the companies which are not resident of a member state of the European Union.

The SPF is subject to annual subscription tax rate of 0.25%, from the paid-up capital or the part of the debt that is above eight times the amount of the paid-in share capital. This annual subscription cannot be less than 100 €. The subscription fee is reported (and paid) quarterly.

There is a minimum share capital, which has to be deposit at registration and which depends on the form of business adopted. For example, a joint stock company must have at least 31000 € from which it must deposit at least 25% at registration while the share capital of a limited liability company is 12400 € and must be fully paid-up at registration. Any SPF must also deposit each year 5% of their profits into a legal reserve, until this reserve amount at least 10% of the SPF’s share capital.

Each year, a SPF must deposit at the Trade Register the following: the balance sheet, the list of directors and auditors and a list of shareholders who have not yet fully paid up their shares (with an indication of the open amounts).

The SPF must also keep annual account statements.

The authority in charge with the SPF supervision is the “Administration de l’Enregistrement” 

Other characteristics of a SPF are that it’s forbidden for the shareholders to be corporate bodies. It may be incorporated with 100% foreign ownership as long as the registered office is in Luxembourg. The annual meetings may be held anywhere in the world.

The video below shows how to establish a SPF in Luxembourg:

What are the basic procedures for the formation of a SPF in Luxembourg?

The main forms that a SPF can take are the limited liability company (based on a share capital of 12,400 EUR and not more than 40 investors) or the joint stock companies (with at least two founders and an initial capital of 31,000 EUR). The main difference between the usual SA or SARL and the SPF is that the last ones cannot be engaged in commercial activities and the securities issued cannot be transferred to the public or registered on a stock exchange market. The name must be unique, written with Latin characters and must end with SPF. The first step in SPF incorporation is checking the uniqueness of the name in the Trade Register.

After that, the minimum share capital has to be deposit and the receipt for it must be received.

Along with this receipt the investor must prepare the notarized articles of association and deposit it at the “Registre de Commerce et des Sociétés”. The publication of the Articles of Association in the Official Gazette of Luxembourg must be made. The documents may be in any language, but it has to be accompanied by a French or German translation.

How long does it take to incorporate a SPF in Luxembourg?

The procedure of SPF registration in Luxembourg usually doesn’t take longer than a week if all the documents are elaborated correctly.

For more details about other investment funds in Luxembourg, you may contact our lawyers in Luxembourg.


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