What Setting Up a Luxembourg Subsidiary Actually Involves

If you’re running a company abroad and considering a Luxembourg subsidiary, here’s what the process actually involves.

The first decision is structure. A subsidiary is a separate legal entity with its own liability, usually requiring at least €12,000 in share capital. A branch is lighter, no separate capital needed, but it stays legally tied to the parent company.

One detail that trips people up: the low-cost €1 S.à r.l.-S structure many people hear about isn’t an option here. It can only be formed by individuals, not by a company, so a foreign business looking to open a subsidiary can’t use it. The standard S.à r.l., with its €12,000 minimum, is the real starting point.

From there, the steps follow a similar pattern to any Luxembourg company: reserve the name, draft the articles of association, deposit the capital, sign before a notary, register with the Trade and Companies Register, then get a business permit before starting any activity.

Certain sectors also need more than the standard permit. Transport and logistics, for example, are regulated at the EU level, so professional competence and financial standing get checked separately.

None of this is complicated once it’s laid out clearly, but it does take knowing where to look first. This is exactly the kind of setup LuxPartner Services helps founders navigate from the first decision through registration.