Escheatment of dormant accounts or unclaimed insurance policies

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The law of 30 March 2022 on inactive accounts, inactive safe deposit boxes and unclaimed insurance policies (loi du 30 mars 2022 relative aux comptes inactifs, aux coffres-forts inactifs et aux contrats d'assurance en déshérence) sets out the legal framework governing:

  • accounts and safe deposit boxes said to be 'dormant' or 'inactive'; and
  • unclaimed life insurance policies.

This law sets out the principles whereby banks must turn over assets held in accounts and safe deposit boxes to the Consignment Office (Caisse de consignation) after a prolonged period of inactivity. Insurance companies must do likewise for life assurance policies which have remained unclaimed for a prolonged period.

An application for escheatment of assets must be filed with the Consignment Office electronically, through MyGuichet.lu.

Once assets have been escheated, anyone who can prove entitlement to them may apply for their return.

Who is concerned?

Prerequisites

Dormancy of an account/safe deposit box/policy

An account or safe deposit box is considered dormant when:

  • in the case of an account:
    • no transactions initiated by the holder have been recorded for an account or safe deposit box held at the same establishment; and
    • the holder has made no contact with the establishment where the account is held;
  • for a safe deposit box: the holder has made no contact with the establishment where the box is held. Note that a transaction on an account by the owner is considered to be a form of contact with the establishment;
  • for a life assurance policy: when no beneficiaries have come forward to claim their right to the entitlements due under the terms of the life assurance policy.

Start date of inactivity

The start date of inactivity is:

  • for an account: the day from which:
    • the holder ceased conducting transactions on any of their accounts or safe deposit boxes held with the same establishment; and
    • the holder ceased contact with the establishment where the account is held;
  • for a safe deposit box: the day from which the holder of the safe deposit box ceased contact with establishment where the box is held;
  • for a life assurance policy: the day from which the insurance company learned that the entitlements under the terms of the policy are due, and for which entitlements no beneficiaries have claimed their rights.

Note:

  • the holder's last contact is that recorded in the establishment's files;
  • the date on which the company learns that the insurance entitlements are due is that recorded in the company's files.

Duration of inactivity

Accounts and safe deposit boxes

When, from the start date of inactivity, there continues to be no activity for a period of:

  • 3 years for an account or 5 years for a safe deposit box, the establishment holding the account or safe deposit box must notify the owner or known beneficiary of the consequences of inactivity on the account/box;
  • 6 years, the account/box is deemed to be dormant;
  • 9 years, the establishment holding the account or safe deposit box must notify the owner or known beneficiary of the consequences of inactivity on the account/box;
  • 10 years, the establishment must file an application with the Consignment Office for the escheatment of the assets.

Where there is more than one holder on the same account, a transaction or contact made by any one of those holders is sufficient to keep the account active.

Life assurance policy

When, from the start date of inactivity, there continues to be no activity for a period of:

  • 1 year, the insurance company holding the policy must notify the known beneficiary of the consequences of failing to claim the entitlements under the policy;
  • 2 years, the policy is deemed unclaimed;
  • 5 years, the insurance company holding the policy must notify the known beneficiary again of the consequences of failing to claim the entitlements under the policy;
  • 6 years, the establishment must file an application with the Consignment Office for the escheatment of the assets.

Preliminary steps

Applications for the escheatment of assets must be filed through a business eSpace certified by the State Treasury on MyGuichet.lu.

Deadlines

Applications for the escheatment of assets must be filed within 3 months of the expiry period which is:

  • 10 years, for an account or safe deposit box; or
  • 6 years, for a life assurance policy.

Costs

The administrative costs in connection with the filing and assessment of an application for escheatment of assets must be borne by the establishment in question.

The administrative costs are set by Grand Ducal regulation and may not be less than EUR 50 or more than EUR 250 per application.

How to proceed

Filing an application for escheatment of assets

Applications for escheatment of assets must be filed with the Consignment Office electronically, through MyGuichet.lu.

The person filing the application must have a LuxTrust product (e.g. a Token, Smartcard or Signing stick) or an electronic identity card (eID).

The filing must be carried out through MyGuichet.lu (business eSpace):

  • either by uploading a structured document in XML format, of no more than 7 MB in size;
  • or by using the online data input wizard.

Supporting documents

In support of the application for escheatment, the applicant must submit all information and documents mentioned in Annexe 1 (for banks) or in Annexe 2 (for insurance companies) of the law, including:

  • the amounts to be escheated;
  • the details of the account holder/policyholder;
  • the details of any beneficiaries.

Processing the application for escheatment

The Consignment Office will examine the application and, where necessary, will request any additional information and/or documents needed in order to process the application for escheatment.

Such information and documents must be submitted promptly, in electronic format, through MyGuichet.lu.

Application processing time

The Consignment Office will make a reasoned decision and notify the establishment in question:

  • within 6 months of receiving the application for escheatment; or
  • if the application is incomplete, within 6 months of receiving all information and documents needed to make the decision.

If the application is accepted, the Consignment Office will inform the establishment in question by way of an electronic response through MyGuichet.lu.

If the application is rejected, the applicant will be informed through MyGuichet.lu.

If, within that 6-month time limit, the applicant has not received notification of a decision, the application should be deemed to have been rejected.

The Consignment Office may refuse to escheat the assets, in particular:

  • when the legal requirements are not fulfilled; or
  • when the submitted information proves to be incomplete, inaccurate or false.

Transfer of assets

When an application for escheatment has been accepted, the establishment in question must forward the assets within one month of receiving notice that the application has been approved.

Once the assets have been received, the Consignment Office will issue an escheatment receipt, which confirms that the escheatment has effectively occurred. The receipt specifies:

  • the nature of the escheated assets;
  • the amounts in question.

If there is a difference between the amount stated in the application for escheatment and the amount that has actually been escheated, or if any other point of information provided in the application no longer holds true at the time of the escheatment, then the establishment or the insurance company must state the reasons.

In the absence of sufficient justification, the Consignment Office may:

  • refuse to issue the receipt; and
  • return the deposited assets to the establishment or insurance company that filed the application for the escheatment of the assets.

The Consignment Office maintains an electronic register of escheated assets.

Cancelling an application for escheatment

Applicants may cancel applications for escheatment by:

  • filing a cancellation application in XML format; or
  • using the online cancellation wizard on MyGuichet.lu.

Requirement to keep information

The establishments are required to keep the information and documents specified in Annexe 3 of the law, including such information and documents pertaining to:

  • the opening of the bank account, the leasing of the safe deposit box, or the taking out of the insurance policy;
  • the last transaction made by the holder and the last contact from the holder;
  • the identity of the account holders/policyholders;
  • the balance of the accounts prior to the escheatment;
  • the contents of the safe deposit box;
  • a detailed breakdown of the insurance entitlements due under escheated life assurance policies.

The information and documents must be kept for:

  • as long as the assets are escheated;
  • 5 years from the date on which the escheatment ends.

Effects of escheatment

Escheatment entails:

  • the closure of the holder's accounts and safe deposit boxes held with the establishment;
  • the termination of the contractual relationship between the insurance companies and the policyholders.

Penalties

Should they fail to fulfil the legal requirements, credit establishments and insurance companies, as well as their managers and any other person responsible for a violation, risk:

  • sanctions and other administrative measures:
    • fines up to a maximum of:
      • EUR 250,000, for natural persons; or
      • EUR 1,000,000, for legal persons;
    • public declarations;
    • temporary prohibitions from holding managerial roles;
  • criminal sanctions: fines of between EUR 12,500 and EUR 1,000,000.

Appeal

A negative decision in response to an application for escheatment is an administrative decision against which the usual means of appeal (non-contentious appeal, judicial appeal) may be pursued, provided the legal deadlines are complied with.

Online services and forms

Who to contact

Caisse de consignation (Consignment Office)

Related procedures and links

Procedures

Challenging administrative decisions

Links

Legal references

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