Luxembourg company types

Main types of companies

1. A partnership (société en nom collectif – SENC) is a commercial company characterised mainly by the unlimited joint and several liability of the partners for all the commitments of the company. In order to demonstrate this liability, the company name must include the name of one or more partners.

2. 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:

3. The public limited company (société anonyme – SA) together with the limited liability company (société à responsabilité limitée – SARL) is one of the most common legal forms in Luxembourg. This form of company offers many advantages, including limited liability and regulated access to the capital.

4. A limited liability company (société à responsabilité limitée – SARL) is a specific type of commercial company: it has the characteristics of a capital company (liability of the partners limited to the amount of their contributions) as well as the characteristics of a partnership (non-transferable company shares).

5. A partnership limited by shares (société en commandite par actions – SECA or SCA) is a commercial company. It combines the characteristics of a SECS and an SA.

6. (société coopérative – SC) The main feature of a cooperative company (société coopérative – SC) is its variable capital and the absolute non-transferability of shares to third parties. The variable nature of its capital often results in a change of the number of partners. An SC is a legal form intended mainly for the salaried workforce and which is also the main reason for the absolute non-transferability of company shares.

An SC has considerable latitude in the drafting of its articles of association, offering partners flexibility concerning their responsibilities and the functioning and management of the company.

7. société européenne – SEA European company, often referred to by its Latin name ‘Societas Europaea’, is a company governed by Community law. It has its own legal framework and acts as a single economic operator throughout the entire European Union.

The status of a European company allows for mergers and restructurings of European groups and thus avoids the legal and practical obstacles under the laws of the different European Union countries. A European company therefore does not need to set up a complex network of subsidiaries governed by the different national legislations, but can carry out its activities on European Union territory through branches.