International tax advice

The European Company (SE)

Adopting the status of European Company (to be commonly called SE or Societas Europae), will allow companies that wish to do so, to carry out their activities within European territory under a single legal identity acknowledged in all member countries, and without having to hold a different legal identity in each of those States.

Setting up a European Company

This law will be the ratification of a new type of Public Limited Company: the Single-Member Public Limited Company.

In all cases, any person wishing to set up a European Company will need to have owned a branch in a member country for at least two years, and to have their administrative headquarters located there. In addition, the company must have at least EUR 120 000,00 in capital.

A European Company may be created by merging two or more Public Limited Companies, whose headquarters in the Community are located in two different Member States.

A European Holding Company may be set up on the initiative of a company located in different Member States.

A European Subsidiary Company may be set up by companies that hold a legal identity (does not apply for non-profit companies) under civil or commercial law, and by other legal entities under private or public law, legally constituted in a Member State and having their registered office and administrative centre in the Community and subscribing for shares, if two or more of these companies are legally liable in different Member States, or if for at least two years they have owned a subsidiary that is legally liable in another Member State or a branch located in another Member State.

A Public Limited Company may be changed into a European Company after it has owned a subsidiary legally liable in another Member State for at least two years.

Managing European Companies

The Administrative Council may now be composed of a single member, under the new status of the Single-Member Public Limited Company. This contrasts with the situation in place until recently, whereby under 1915 law, at least three administrators are required.

The bill proposes to introduce a "dual” form of management into Luxembourg law, through the creation of a Board of Directors and a Supervisory Board.

The Board of Directors

As its name suggests, it manages the company. Article 60bis 8 ascribes to the Board of Directors the same powers as those legally attributed to the Administrative Council of a Public Limited Company, with the exception that the Board of Directors must exercise its powers under the supervision of a Supervisory Board.

The Supervisory Board

The Supervisory Board is responsible for the permanent supervision of management by the Board of Directors, without actually intervening in the management process.
The members of the Supervisory Board have the right to access unlimited information on the company's activities.

General Assemblies

The bill proposes to introduce a new article 67(3) acknowledging the validity of General Assemblies held via videoconferencing. According to this article, shareholders who take part in the Assembly via videoconferencing or an other telecommunications technique that allows them to be identified, will be deemed present for the purposes of quorum.

Transfer of Head Office

The bill proposes to introduce article 101-1 to paragraph 10, entitled “Transfer of the Registered Office of an SE”, which applies only to European Companies. The proposed article 101-1 would determine that the Registered Office of an EC Member State may be transferred to - and from – the Grand Duchy of Luxembourg, without dissolution of the company and without the need to create a new legal entity.