September 7, 2011, 12:32 am
A Limited Liability Company in Luxembourg is known under the name of Societe a Responsabilite Limitee or SARL. This type of firm is regulated by the Commercial Companies Law 1915 and it is the ideal form of business for those foreign investors who want to keep their business structure and their administrative formalities simple.
The minimum share capital required for the incorporation of a SARL in Luxembourg is around 12,400 EUR, which must be fully paid up before registration. Contributions are accepted in both the form of cash or assets, with the specification that they do not require independent evaluation from an auditor. Company shares will be of equal value and one share will not value less than 24.79 EUR.
When setting up a Limited Liability Company in Luxembourg, the maximum number of shareholders is 40. There must be at least two founders. Shareholders are liable for the amount of the capital they contributed with. If there are less than 25 shareholders, it is not necessary to call an annual general meeting.
A limited liability company in Luxembourg is administered by a management board, which may formed of one or more managers. Managers can be appointed in the constitutional documents, otherwise they can be appointed by a general meeting of partners for a determined period of time. Unless a different thing is stipulated in the articles of association, each manager can individually represent the company in front of any third parties, even the courts of justice.
Supervision by one or more registered auditors (commissaires aux comptes) is mandatory only if there are more than 25 shareholders or if after two years, the company exceeds a total balance sheet of 3.125 million EUR, as well as a net turnover of 6.25 million EUR or 50 employees. The management board has to submit every year with all partners the balance sheet, together with an inventory consisting of all assets and liabilities of the company. The auditor also has to prepare a report, which is then submitted at the registered office of the SARL within seven months of the closing of the financial year.
All companies established in Luxembourg require a business license, issued by the Ministry of Middle Classes. In order to obtain the permit, an entrepreneur needs to submit an application form together with some documents that provide the proof of knowledge of business management.Tweet
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