The Luxembourg Parliament adopted two new laws on 18 July 2016 (the “New Laws”), which update key features of some of Luxembourg’s long-established and most frequently used corporate structures and introduce new structures. The New Laws, which amend the Luxembourg company law (the “Company Law”), are expected to enter into force in August 2016 and January 2017, respectively.
This significant reform of the Company Law is an integral part of Luxembourg’s continued efforts to enhance its attractiveness as a jurisdiction of choice for setting up corporate and investment fund structures in Europe. The New Laws amend the Company Law to provide greater flexibility for boards and shareholders and increase legal certainty by codifying established market practices.
A grandfathering clause provides for a 24 month transitional period (running from the effective date of the changes to the Company Law) within which existing companies must amend their articles of incorporation in accordance with the amended Company Law.
As the New Laws will result in a large number of changes to the Company Law, this OnPoint summarizes some of the key changes to existing company structures and the main features of the newly introduced structures. It can be noted that some of the changes will impact the organization and structuring of investment funds.