Company Reforms: Private Limited Liability Company

You can read the infographic version of our guide here.

Luxembourg private limited liability companies (Sarls) need to consider what changes should be made to their articles of association following the modernisation of the Luxembourg law on commercial companies and the Grand-Ducal regulation on the coordination and renumbering of the Luxembourg law on commercial companies (the New Companies Act). Without amendments to their articles of association, companies will have to continue under the constraints of the old regime, and there are likely to be many areas of confusion over which law to apply as not all matters covered by existing articles of association are automatically changed by the New Companies Act.

All updates should be made before 22 August - the date that the reforms take effect.

5 things you need to know...

The board of managers may increase the corporate capital within the limits of the authorized capital and issue beneficiary shares and redeemable shares as well bonds to the public

The double majority requirement to amend the articles of association has been abolished. A majority of 75% of the share capital is now sufficient.

The board of managers can delegate the daily business of the company to a day-to-day manager

New provisions to facilitate how manager's conflict are dealt with have been introduced by the New Companies Act (the same rules as for the SA are applied to the S.à r.l.)

Approval of the transfer of shares to a third-party can now be approved by the shareholders with a reduced voting majority of 50% and the New Companies Act provides for an exit...