Limited partnership (SECS)

A limited partnership (société en commandite simple - SECS) is a commercial company. It requires at least two partners, namely one general partner and a limited partner. The 2 partners have different levels of liability:

  • the general partner has joint and several liability for the commitments of the company;
  • the limited partner is only liable up to the level of his contributions.

Who is concerned

A SECS can be used in practice for all types of business.

The distinction between 2 types of partners has 2 main advantages. It allows:

  • general partners to increase the capital of the company without diluting their powers;
  • limited partners to back a company without facing unlimited risks.

For these reasons, it is particularly interesting for young entrepreneurs with innovative ideas who need financing from other persons, as well as for entrepreneurs that wish to invest in a company whilst limiting their liability. It is also suitable for small and medium-sized family businesses (transfer to a minor heir is possible).


Before forming an SECS, one must ensure that the general partners have the capacity as traders, which is not required for limited partners.

How to proceed

Creation of the company

Constitutional documents

  • notarised or private deed;
  • lodging with the trade and companies register (RCS) for the purpose of publication in the electronic repository of companies and associations (Recueil électronique des sociétés et associations - RESA).


  • unlimited, unless otherwise specified in the articles of association;
  • dissolved by the will, death, ruin, suspension or bankruptcy of one of the general partners, unless otherwise stipulated in the articles of association.



  • no minimum share capital;
  • indication in the articles of association of the amount of the share capital or the value of the contributions made or to be made by each general or limited partner;
  • share capital: contributions in cash, in kind, or in services (no auditor’s report required);
  • limited partner:
    • contributions form part of the share capital;
    • need not be made at the time of formation (an irrevocable commitment is sufficient).

Form of interest shares

  • registered shares only.

Transfer of interest shares

  • Shares of non-transferable or transferable interests, except if noted otherwise in the articles of association
    (eg restricted transferability):
    • limited partners' interest shares which are transferable subject to the consent of all partners ;
    • limited partners’ shares transferable with the consent of the majority or the reinforced majority of partners.
  • notification and acceptance of the transfer by the company and publication in the Trade and Companies Register (Registre de Commerce et des Sociétés - RCS);
  • subject to registration fees if the company owns immovable assets.



  • general partner: capacity as a trader;
  • limited partner: no conditions.


  • mininum 2: one general partner and one limited partner;
  • no maximum number.


  • general partners: unlimited joint and several liability for all of the company commitments towards:
    • company creditors up to the company assets, plus the personal assets of the partners;
    • the tax administration, if the liabilities result from the activities of the business (VAT, communal business tax);
    • the other partners, as joint and several co-debtors, unless otherwise stipulated in the articles of association;
  • limited partners:
    • joint and several liability, but limited to their contribution;
    • liability towards third parties to repay interest and dividends if they were not deducted from the actual profits but from the share capital.
    • prohibited from carrying out an act of management with regard to third parties under penalty of incurring unlimited liability (this prohibition is not valid for: advising the board, acts of control and supervision, authorisations given to business managers for acts that are outside their powers).

Partners’ meetings

Unless noted otherwise in the articles of association:

  • all shareholder decisions are taken at general meetings or by written consultation during which each shareholder receives the text of resolutions or decisions to be expressly made and votes in writing ;
  • decision is validly taken only by a majority of the votes cast, regardless of the portion of the interest shares represented, except for decisions concerning changes in the corporate purpose, change of nationality, transformation or liquidation, which are adopted only by the consent of partners representing 3/4 of the interest shares, and in all cases by the consent of all the general partners;
  • these meetings or written consultations may be convened or initiated by the manager(s) or by partners representing more than half of the interest shares;
  • each partner's voting rights are proportionate to their shares.

the forms and rules for calling meetings are defined in the articles of association.

Operation of a SECS


  • management is the responsibility of one or more general partners or non-associated persons, appointed in accordance with the social contract;
  • in the absence of any appointments, all the general partners are managers;
  • the manager has the status of an agent in terms of liability, but is in fact a body of the company;
  • there is no restriction on the nationality of business managers;
  • limitation of the administrative powers of the business manager by the company object and the articles of association (an act that does not comply with the company object or the position of the business manager is nevertheless binding on the company if it is taken by the partners’ meeting);
  • the manager does not have to be qualified as a merchant;
  • responsibility of managers who do not have the status of general partner:
    • responsible to the company for misconduct in the course of their activity;
    • solidarily liable either to the company or to third parties for damages resulting from breaches of the law on companies or the articles of association.

Accounting aspects

Accounting and financial information

The SECS must maintain accounts that are appropriate to the nature and meaning of its business, and in accordance with the Standard Chart of Accounts. It is neither obliged to draw up annual accounts (balance sheet, profit and loss account and the annex) and to monitor the NCP if the annual turnover of its last financial year does not exceed EUR 100 000 ( Excluding VAT), nor to deposit them. Conversely, if it exceeds this threshold, it is bound to do so.

Also, the SECS is obliged to draw up annual accounts, in accordance with the standardized chart of accounts, in cases where:

  • all of the partners with unlimited liability are legal persons in the form of an SA (public limited company), SARL (limited liability company) or SECA (partnership limited by shares);
  • all of the partners with unlimited liability are themselves organised as a SENC/SECS or SA, SARL or SECA;
  • the partners are non-European companies, but with a comparable legal form.

The annual accounts are submitted to the shareholders' meeting and must be deposited with the Luxembourg Trade and Companies Register within the 7 months following the end of the financial year (6 months to hold the meeting plus 1 month from the date of the meeting) along with the balance of the accounts.

SECSs can draw up an abbreviated balance sheet if, on the balance sheet date, they do not exceed 2 out of 3 of the following criteria:

  • balance sheet total: EUR 4.4 million;
  • net turnover: EUR 8.8 million;
  • average number of (full-time) staff: 50;

SECSs can combine certain headings in the profit and loss accounts if, on the balance sheet date, they do not exceed 2 out of 3 of the following criteria:

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

The accounts must be drawn up according to the "Lux Gaap" rules.

Supervision / control of the company

  • no internal auditors (commissaire aux comptes), no general meeting;
  • statutory audit by a mandated auditor in every SECS:
    • whose partners are SAs, SARLs, SECAs or companies in any other comparable legal form;
    • if, on the balance sheet closing date after 2 consecutive financial years, 2 of the 3 following criteria are exceeded:
      • balance sheet total: EUR 4.4 million;
      • net turnover: EUR 8.8 million;
      • average number of (full-time) staff: 50.

Tax aspects

  • fixed registration fee;
  • property tax;
  • business tax;
  • net wealth tax (if the shareholder is an opaque company);
  • personal income tax;
  • as a fiscally "transparent" company, an SECS is not taxable as such;
  • VAT declaration according to the following criteria:
    • annual turnover excluding tax of less than EUR 112,000 -> annual declaration;
    • annual turnover excluding tax between EUR 112,000 and EUR 620,000 -> quarterly declaration;
    • annual turnover excluding tax greater than EUR 620,000 -> monthly.

Who to contact

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