PARTNERSHIPS LIMITED BY SHARES: LUXEMBOURG SCA

Partnerships limited by shares (Luxembourg SCA)

A partnership limited by shares (known as either SCA or SECA in Luxembourg) is a tool which is increasingly used in international tax planning operations, due to its original hybrid structure. These companies have certain characteristics of both a partnership and a corporation.

Associates of a Partnership limited by shares (SCA)

There are two categories of associates in a Partnership Limited by Shares (SCA) :

• One or several active partners who are indefinitely and solidly responsible for the commitments of the SCA;
• And at least two active partners whose responsibility is limited to their investments.

Corporate name for Partnerships Limited by Shares (SCA)

The corporate name for this type of company must be the last names of the active partners.

Share capital of Partnerships Limited by Shares (SCA)

The minimum share capital of a Luxembourg Partnership Limited by Shares (SCA) is 31,000 EUR of which 25% must be paid in upon incorporation if the contributions are in cash.

When the capital is fully paid in, the shares can be released either as registered or bearer shares, to be chosen by the shareholder. Bearer shares must be held in a shareholders account by a depositary.

Managing a Partnership Limited by Shares (SCA)

Management responsibilites are conferred to one or more managers which are chosen by the active partners.

External auditor for a Partnership Limited by Shares (SCA)

A Partnership Limited by Shares must be audited by an Audit Board comprising a minimum of 3 auditors.

Taxation on a Partnership Limited by Shares (SCA)

Partnerships Limited by Shares (Luxembourg SCA) falls under corporate tax law and therefore are subject to corporate income tax.