Private limited liability company (SARL)

A private limited liability company (Société à responsabilité limitée – SARL) is a special form of commercial company in that: it combines features that are characteristic of both capital companies (e.g. the limitation of shareholders' liability to the extent of their contribution) and partnerships (e.g. the non-transferability of shares in the company).

The SARL is the most common form of incorporation in Luxembourg. Approximately two-thirds of companies in Luxembourg are SARLs.

An SARL can have between 2 and 100 shareholders.

There is also a form of SARL known as a "single member" SARL. The single member SARL is an exception to the traditional idea of a company in company law, in that it is an SARL that can be set up by a single shareholder.

Who is concerned

An SARL can have between 2 and 100 shareholders. The shareholders may be natural or legal persons.

There may be only one shareholder at the time of incorporation since it is possible for one shareholder to own all of the shares.

Prerequisites

An SARL may be formed for any business purpose.

However, insurance companies, savings companies and investment companies may not be formed as SARLs.

Anyone who wishes to set up a company to do business in Luxembourg must have the requisite authorisations/approvals.

Costs

Setting up an SARL entails certain costs, including:

  • a share capital contribution of at least EUR 12,000;
  • notary fees;
  • the cost of publication in the Trade and Companies Register (Registre de commerce et des sociétés – RCS);
  • statutory auditor fees (if statutory audits are required);
  • any costs related to the issuance of administrative permits.

How to proceed

Deed of incorporation

An SARL must be formed in the presence of a notary.

The deed of incorporation must contain certain legally required information, such as:

  • the identity(ies) of the natural or legal person(s) who signed the deed, or on whose behalf the deed was signed;
  • the form of the company and the company name;
  • the address of the company's head office;
  • the company/business purpose;
  • the amount of subscribed share capital;
  • the different classes of shares;
  • details of contributions in kind;
  • details of any other non-cash considerations at the time of incorporation;
  • where applicable, the number of securities or shares that do not form part of the share capital, and the rights attached thereto;
  • when not provided for by law, the rules governing the operation, administration and oversight of the company;
  • the duration of the company;
  • at least an approximation of the company's costs.

The articles of association must be filed in full with the Trade and Companies Register for publication.

Company name

An SARL must have a company name that is established in its deed of incorporation.

The name must be different from that of any other existing company.

To find out whether the company name is available, contact the RCS.

Duration

An SARL may be formed for a limited duration or an unlimited duration.

Conversion

An SARL may change its corporate form in the course of its lifetime through shareholder decision.

If the number of shareholders exceeds 100, the SARL has one year to change its legal form.

The rules on mergers and demergers, which are likely to bring about a change in legal form, apply to SARLs.

Dissolution

An SARL may be dissolved for the following reasons:

  • expiry of the company's duration;
  • completion or extinction of its business purpose;
  • judicial ruling to dissolve the company for legitimate reasons;
  • voluntary dissolution decided on by the single shareholder or all of the shareholders at the meeting of shareholders.
An SARL is not automatically dissolved in the event of the disqualification, bankruptcy, insolvency or death of one of its shareholders.

Any document establishing the voluntary dissolution of the company must be accompanied by the following administrative certificates:

Capital

Incorporating as an SARL requires a minimum share capital of EUR 12,000.

The share capital must be fully subscribed and paid up at the time of incorporation.

An SARL may issue shares with different values, either with or without a nominal value.

Contributions can be made in cash or in kind.

Contributions in kind must be valued in the articles of association.

Contributions "in industry" (services, know-how, etc.) do not form part of the share capital and do not need to be valued separately by a statutory auditor. Contributions in industry:

  • entitle the contributor to non-transferable shares;
  • entitle the contributor to share in the profits and net assets of the company, and obligates them to contribute to covering its losses.

Form of company shares

The shares in the capital of an SARL are issued as registered shares, with or without a nominal value.

An SARL is permitted to issue profit shares. The profit shares do not form part of the company's share capital. The rights attaching to the profit shares must be specified in the articles of association.

Public issues of shares or bonds are not permitted.

Private bond issues are allowed, but require the shareholders' approval in the case of convertible bonds.

Transfer of company shares

The company shares are not freely negotiable.

They may only be transferred inter vivos to non-shareholders with the approval of the general shareholders meeting representing at least 75 % of the share capital. However, if provided for in the articles of association, the proportion of the share capital required for approval may be lower (but not less than 50 %).

Unless otherwise specified in the articles of association, the shares may be freely transferred between the shareholders.

Share transfers must be recorded in a notarised deed or a private deed.

Structure of managerial bodies

An SARL is managed by one or more managerswho may or may not be shareholders – appointed by the shareholders, either in the articles of association or by subsequent deed, for a limited or unlimited term.

The manager

A legal person may be appointed to manage an SARL.

With the exception of actions requiring a decision on the part of the shareholders, as provided for by law or in the articles of association, the manager(s) may undertake any action they deem necessary or useful for achieving the corporate purpose.

They represent the company with respect to third parties and in the courts.

There are no restrictions on the nationality of an SARL's managers; they may be Luxembourg nationals, EU nationals, or nationals of any third country.

Managers need not be registered as traders.

They may only be removed from office for legitimate reasons, such as: obvious incapacity, unfair competition to the detriment of the company or misappropriation of funds, unless otherwise specified in the articles of association.

Meeting of shareholders

The shareholders' decisions are taken at general meetings of shareholders.

The general meeting decides on:

  • amendments to the articles of association;
  • changes in the company name;
  • changes in the share capital;
  • changes in the legal form of the company;
  • the appointment or dismissal of managers;
  • the liquidation of the company, or changes in its nationality.

The shareholders are entitled to a share of the profits.

The shareholders are entitled to information on the inventory, balance sheets and reports produced by the supervisory board, if such a board exists.

In SARLs with more than 60 shareholders a general meeting of shareholders must be held at least once a year. The time of year at which the meeting is held is specified in the company's articles of association.

Other meetings of shareholders are convened by the manager(s).

Unless the articles of association have been amended to state otherwise, it is not mandatory to hold a general meeting in SARLs with fewer than 60 partners. In this case, the partners are invited to send in their votes in writing, after having received the text of the resolutions or decisions to be taken.

All shareholders are entitled to take part in the decision-making process.

Shareholders may enter into agreements among themselves regarding the exercise of voting rights.

Each shareholder has a number of votes equal to the number of shares they hold. Decisions are validly taken by majority vote representing 50 % of the capital.

In SARLs with a single shareholder, the latter alone wields the powers vested in the general meeting of shareholders.

Liability

The founders of the company and, in the event of an increase in capital, the managers, are jointly liable in respect of third parties for:

  • any part of the capital that is not validly subscribed, and for the difference between the minimum capital and the subscribed capital;
  • the full payment of the shares and the portion of the capital for which they have subscribed;
  • remedying any damages arising from:
    •  the company's nullity; or
    •  omissions or inaccurate statements in the company's deed of incorporation.

However, the deed of incorporation of the SARL may restrict the label of "founder" to subscribers who, together, hold at least one third of the share capital. In that case, all other shareholders mentioned in the deed of incorporation will be deemed simple subscribers.

The shareholders are liable to the extent of the amount of their contribution to the share capital.

The company is bound by the actions undertaken by the manager(s), even when they surpass the corporate purpose, unless it can be proven that the third party involved knew, or could not have been unaware of, the fact that the action surpassed the corporate purpose.

However, when several managers are appointed, the company may define their joint and/or individual duties and powers, in which case the latter must be declared to the Electronic Compendium of Companies and Associations (Recueil électronique des sociétés et associations – RESA) for publication and then become enforceable against third parties.

Managers are accountable to the company for carrying out the duties entrusted to them, and for any misdeeds committed in the performance of such duties.

Obligations

Auditor oversight

SARLs with more than 60 shareholders are subject to compulsory oversight by one or more internal auditors, whose names are mentioned in the articles of association. The auditors may or may not be shareholders.

Any company which, on the balance sheet closing date after 2 consecutive years of operation, exceeds the thresholds specified in 2 of the 3 criteria mentioned below, is legally required to have their accounts audited by a statutory auditor:

  • balance sheet total: EUR 4.4 million;
  • net turnover: EUR 8.8 million;
  • average number of full-time employees: 50.

Legal publications

The articles of association of the SARL must be filed in full with the Trade and Companies Register for publication.

In order to register the company with the RCS, the following information about the company must be disclosed:

  • the company or trade name and, where applicable, any abbreviations or commercial sign used;
  • the legal form of the company and, where applicable, any additional details required by law;
  • the exact address of the company's head office;
  • the purpose of the company;
  • the total share capital;
  • the identities of its shareholders, their private or professional addresses and the number of shares they hold;
  • for shareholders who are natural persons, their surnames, first names and their date and place of birth;
  • for shareholders who are legal persons that are not registered with the Luxembourg Trade and Companies Register:
    • their company or trade name;
    • their legal form;
    • their business registration number in the Trade and Companies Register, if the law of the State in which the company is based provides for such a number, and the name of the business register;
  • for shareholders who are legal persons registered with the Luxembourg Trade and Companies Register: merely the registration number.

The deed of incorporation and all subsequent amendments thereto must be filed with the RCS for publication.

All of the company's legal documents must bear:

  • the company name;
  • the wording, "société à responsabilité limitée";
  • the address of its head office;
  • the Luxembourg Trade and Companies Register registration number;
  • the capacity of the signatory of the legal document.

There is no requirement to mention the share capital.

The company's financial statements must be filed with the Luxembourg Trade and Companies Register within 7 months of the close of the financial year (6 months to hold the general meeting of shareholders, plus 1 month from the date of the meeting).

Accounting

An SARL must produce:

  • a balance sheet;
  • a profit and loss statement, along with its annexes;
  • in principle, a management report.

All of these documents must be approved by the general shareholders' meeting.

An SARL may produce a short-form balance sheet if, on the balance sheet closing date, it has not exceeded the thresholds in 2 of the following 3 criteria:

  • balance sheet total: EUR 4.4 million;
  • net turnover: EUR 8.8 million;
  • average number of full-time employees: 50.

An SARL may group certain items together in the profit and loss statement if, on the balance sheet closing date, it has not exceeded the thresholds in 2 of the following 3 criteria:

  • balance sheet total: EUR 20 million;
  • net turnover: EUR 40 million;
  • average number of full-time employees: 250.

Taxation

SARLs are subject to the following fees and taxes:

  • a fixed registration fee;
  • property tax;
  • business tax;
  • net wealth tax;
  • corporate income tax;
  • VAT, based on the following criteria:
    • if its annual turnover excluding taxes is less than EUR 112,000: VAT returns must be filed annually;
    • if its annual turnover excluding taxes is between EUR 112,000 and EUR 620,000: VAT returns must be filed quarterly;
    • if its annual turnover excluding taxes exceeds EUR 620,000: VAT returns must be filed monthly.

Forms / Online services

Model of memorandum of association for a Luxembourg SARL

To complete your application, the information about you collected from this form needs to be processed by the public administration concerned.

That information is kept by the administration in question for as long as it is required to achieve the purpose of the processing operation(s).

Your data will be shared with other public administrations that are necessary for the processing of your application. For details on which departments will have access to the data on this form, please contact the public administration you are filing your application with.

Under the terms of Regulation (EU) 2016/679 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, you have the right to access, rectify or, where applicable, remove any information relating to you. You are also entitled to withdraw your consent at any time.

Additionally, unless the processing of your personal data is compulsory, you may, with legitimate reasons, oppose the processing of such data.

If you wish to exercise these rights and/or obtain a record of the information held about you, please contact the administration in question using the contact details provided on the form. You are also entitled to file a claim with the National Commission for Data Protection (Commission nationale pour la protection des données), headquartered at 1, Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette.

By submitting your application, you agree that your personal data may be processed as part of the application process.

Modèle de statuts - SARL

Modèle d’acte constitutif d’une société à responsabilité limitée

Les informations qui vous concernent recueillies sur ce formulaire font l’objet d’un traitement par l’administration concernée afin de mener à bien votre demande.

Ces informations sont conservées pour la durée nécessaire par l’administration à la réalisation de la finalité du traitement

Les destinataires de vos données sont les administrations compétentes dans le cadre du traitement de votre demande. Veuillez-vous adresser à l’administration concernée par votre demande pour connaître les destinataires des données figurant sur ce formulaire. Conformément au règlement (UE) 2016/679 relatif à la protection des personnes physiques à l'égard du traitement des données à caractère personnel et à la libre circulation de ces données, vous bénéficiez d’un droit d’accès, de rectification et le cas échéant d’effacement des informations vous concernant. Vous disposez également du droit de retirer votre consentement à tout moment.

En outre et excepté le cas où le traitement de vos données présente un caractère obligatoire, vous pouvez, pour des motifs légitimes, vous y opposer.

Si vous souhaitez exercer ces droits et/ou obtenir communication de vos informations, veuillez-vous adresser à l’administration concernée suivant les coordonnées indiquées dans le formulaire. Vous avez également la possibilité d’introduire une réclamation auprès de la Commission nationale pour la protection des données ayant son siège à 1 Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette.

En poursuivant votre démarche, vous acceptez que vos données personnelles soient traitées dans le cadre de votre demande.

Muster einer Gesellschaftssatzung einer SARL

Ihre in diesem Formular erfassten personenbezogenen Informationen werden von der zuständigen Verwaltungsbehörde verarbeitet, um Ihren Antrag erfolgreich abzuschließen.

Diese Informationen werden von der Behörde für den zur Verarbeitung erforderlichen Zeitraum gespeichert.

Die Empfänger Ihrer Daten sind die im Rahmen Ihres Antrags zuständigen Verwaltungsbehörden. Um die Empfänger der in diesem Formular erfassten Daten zu erfahren, wenden Sie sich bitte an die für Ihren Antrag zuständige Behörde.

Gemäß der Verordnung (EU) 2016/679 zum Schutz natürlicher Personen bei der Verarbeitung personenbezogener Daten und zum freien Datenverkehr haben Sie das Recht auf Zugang, Berichtigung und gegebenenfalls Löschung Ihrer personenbezogenen Informationen. Sie haben zudem das Recht, Ihre erteilte Einwilligung jederzeit zu widerrufen.

Weiterhin können Sie, außer in Fällen, in denen die Verarbeitung Ihrer Daten verpflichtend ist, Widerspruch einlegen, wenn dieser rechtmäßig begründet ist.

Wenn Sie diese Rechte ausüben und/oder Einsicht in Ihre Informationen nehmen möchten, können Sie sich unter den im Formular angegebenen Kontaktdaten an die zuständige Verwaltungsbehörde wenden. Sie haben außerdem die Möglichkeit, bei der Nationalen Kommission für den Datenschutz Beschwerde einzulegen (Commission nationale pour la protection des données, 1, Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette).

Wenn Sie Ihren Vorgang fortsetzen, akzeptieren Sie damit, dass Ihre personenbezogenen Daten im Rahmen Ihres Antrags verarbeitet werden.

Model of a memorandum of association for a Luxembourg SARL unipersonnelle

To complete your application, the information about you collected from this form needs to be processed by the public administration concerned.

That information is kept by the administration in question for as long as it is required to achieve the purpose of the processing operation(s).

Your data will be shared with other public administrations that are necessary for the processing of your application. For details on which departments will have access to the data on this form, please contact the public administration you are filing your application with.

Under the terms of Regulation (EU) 2016/679 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, you have the right to access, rectify or, where applicable, remove any information relating to you. You are also entitled to withdraw your consent at any time.

Additionally, unless the processing of your personal data is compulsory, you may, with legitimate reasons, oppose the processing of such data.

If you wish to exercise these rights and/or obtain a record of the information held about you, please contact the administration in question using the contact details provided on the form. You are also entitled to file a claim with the National Commission for Data Protection (Commission nationale pour la protection des données), headquartered at 1, Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette.

By submitting your application, you agree that your personal data may be processed as part of the application process.

Modèle de statuts - SARL unipersonnelle

Modèle d’acte constitutif d’une société à responsabilité limitée unipersonnelle de droit luxembourgeois

Les informations qui vous concernent recueillies sur ce formulaire font l’objet d’un traitement par l’administration concernée afin de mener à bien votre demande.

Ces informations sont conservées pour la durée nécessaire par l’administration à la réalisation de la finalité du traitement

Les destinataires de vos données sont les administrations compétentes dans le cadre du traitement de votre demande. Veuillez-vous adresser à l’administration concernée par votre demande pour connaître les destinataires des données figurant sur ce formulaire. Conformément au règlement (UE) 2016/679 relatif à la protection des personnes physiques à l'égard du traitement des données à caractère personnel et à la libre circulation de ces données, vous bénéficiez d’un droit d’accès, de rectification et le cas échéant d’effacement des informations vous concernant. Vous disposez également du droit de retirer votre consentement à tout moment.

En outre et excepté le cas où le traitement de vos données présente un caractère obligatoire, vous pouvez, pour des motifs légitimes, vous y opposer.

Si vous souhaitez exercer ces droits et/ou obtenir communication de vos informations, veuillez-vous adresser à l’administration concernée suivant les coordonnées indiquées dans le formulaire. Vous avez également la possibilité d’introduire une réclamation auprès de la Commission nationale pour la protection des données ayant son siège à 1 Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette.

En poursuivant votre démarche, vous acceptez que vos données personnelles soient traitées dans le cadre de votre demande.

Muster einer Gesellschaftssatzung einer SARL (Einpersonengesellschaft)

Ihre in diesem Formular erfassten personenbezogenen Informationen werden von der zuständigen Verwaltungsbehörde verarbeitet, um Ihren Antrag erfolgreich abzuschließen.

Diese Informationen werden von der Behörde für den zur Verarbeitung erforderlichen Zeitraum gespeichert.

Die Empfänger Ihrer Daten sind die im Rahmen Ihres Antrags zuständigen Verwaltungsbehörden. Um die Empfänger der in diesem Formular erfassten Daten zu erfahren, wenden Sie sich bitte an die für Ihren Antrag zuständige Behörde.

Gemäß der Verordnung (EU) 2016/679 zum Schutz natürlicher Personen bei der Verarbeitung personenbezogener Daten und zum freien Datenverkehr haben Sie das Recht auf Zugang, Berichtigung und gegebenenfalls Löschung Ihrer personenbezogenen Informationen. Sie haben zudem das Recht, Ihre erteilte Einwilligung jederzeit zu widerrufen.

Weiterhin können Sie, außer in Fällen, in denen die Verarbeitung Ihrer Daten verpflichtend ist, Widerspruch einlegen, wenn dieser rechtmäßig begründet ist.

Wenn Sie diese Rechte ausüben und/oder Einsicht in Ihre Informationen nehmen möchten, können Sie sich unter den im Formular angegebenen Kontaktdaten an die zuständige Verwaltungsbehörde wenden. Sie haben außerdem die Möglichkeit, bei der Nationalen Kommission für den Datenschutz Beschwerde einzulegen (Commission nationale pour la protection des données, 1, Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette).

Wenn Sie Ihren Vorgang fortsetzen, akzeptieren Sie damit, dass Ihre personenbezogenen Daten im Rahmen Ihres Antrags verarbeitet werden.

Who to contact

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