SOPARFI Refresher
Dear friends
I thought it might be interesting to provide as a refresher, selected bullet points on a SOPARFI – SARL setup. The aim is to provide an easy understandable, and accessible overview for business decisions.
Main features can be summed up as follows:
-SARL is a private limited liability company with legal personality, and one of the most common form of companies (also the cheapest) in Luxembourg similar to some extent to an LLC or a Ltd.
-Capital is set at EUR 12k.
-It can have (i) 1 to 100 shareholders(ii) and different classes of shares with different economic rights and/or tracking different underlying assets. Voting rights can be waived individually by shareholders often in the context of a shareholders’ agreement.
-The shares are freely transferable between shareholders and for third party transfers with a consent from the shareholders representing 75% of the share capital, or 50% if so provided in the articles.
-Liability is limited to the capital subscribed.
-A sole manager or a board of managers can be appointed to manage the company. (Foreign) Legal entities can also be appointed as managers. All managers can be revoked at will by the shareholders.
-A notarial deed is required for the setup.
-Depending on the activity a domiciliation can suffice or as required premises can be rented for the registered office.
-The accounts must be prepared within 6 months from the closing of the financial period. They must be approved and published.
-The company is tax opaque, benefits from EU tax directives and has access to a large tax treaty network. Under certain conditions dividends, capital gains can be exempted from corporate income tax, municipal business tax and net wealth tax. Liquidation proceeds can be paid without any Luxembourg withholding tax.
Luxembourg has a very robust and tested KYC legislation and a large pool of international or private banks that are experienced in dealing with international clients. The bank account opening process as a prerequisite to the incorporation, had become more time consuming in recent years and to address this, a decorrelation of the processes were enacted recently offering a 12 months window to open the bank account and pay up the capital. It is also possible to setup a company by a contribution in kind of an asset, a subsidiary or where required of a receivable (derived from a loan x granted to y) to fast-track the incorporation process to a few days provided the KYC file is complete.
Please reach out if I missed something or if anything needs to be clarified to set up your JV, holding, startup or opco!
Arvine Zamani
+352 691 271 977
#Luxembourg#companysetups#business
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