Luxembourg

Business Environment

Opening hours: Businesses: from Monday to Friday from 8.30 AM to 12 AM and from 2 PM to 6 PM. Banks: from Monday to Friday, from 8.30 AM to 4.30 PM and some of them are open on Saturday from 9 AM to 1 PM.

Exchange rate

Current rate: Exchange rate on :

Source: Oanda, XE

Monetary indicators	2004	2005	2006
Average annual exchange rate for 1 USD	0.81	0.80	0.80

Source: World Bank - World Development Indicators

Standards

Domestic framework and international association: The body of standardisation and certification in Luxembourg is the Service of the Energy of the State (SEE). Luxembourg is a member of the European Committee of Standardisation (CEN), the European Committee of Electronic Standardisation (CENELEC), the European Institute of Standardisation of Telecommunication (ETSI), the International Organization of Standardization (ISO) and the International Electrotechnics Commission .
Certain products, whatever their origin is, should be submitted to the technical rules which give rise to a ratification meeting EC standards.

Legal framework

Independence of justice: Luxembourg is a parliamentary democracy with a constitutional monarchy, ruled by a Grand Duke. Luxembourg (official name: Grand Duchy of Luxembourg) is the world's only sovereign Grand Duchy.
The chief of the state is the Grand Duke. The monarch is hereditary. Following popular parliamentary elections, the leader of the majority party or the leader of the majority coalition is appointed as Prime Minister by the monarch to serve a five-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementing of the law and running the day-to-day affairs of the country. The Council of Ministers (cabinet) is recommended by the Prime Minister and appointed by the monarch.
Luxemburg has a unicameral legislature. The parliament consists of Chamber of Deputies which has 60 seats; its members are elected by direct popular vote to serve five-year terms. There also exists a second body called Council of State appointed by the Grand Duke (composed of 21 ordinary citizens recommended by the Prime Minister) which advises the Chamber of Deputies in the drafting of legislation. Grande Duke has constitutional power to dissolve the parliament and reinstate a new one. Prime Minister can only recommend the dissolution of parliament to Grande Duke. Legislative power is vested in both the government and the parliament. The people of Luxemburg enjoy considerable political rights.
The judiciary in Luxemburg is independent, however its judges are appointed by the Grand Duke. The main source of the law is the constitution of 1868 (revised few times). The country’s legal system is based on civil law system. Luxemburg accepts compulsory ICJ jurisdiction. Being member of the European Union, the country’s national law needs to comply with the conditions of the Community legislation. The judicial languages used in Luxemburg are German and French.
Luxemburg is ruled by law. Foreign nationals can expect an impartial trial from the country’s judicial system. The country is largely free from corruption.
Equal treatment of nationals and foreigners: Luxembourg is a parliamentary democracy with a constitutional monarchy, ruled by a Grand Duke. Luxembourg (official name: Grand Duchy of Luxembourg) is the world's only sovereign Grand Duchy.
The chief of the state is the Grand Duke. The monarch is hereditary. Following popular parliamentary elections, the leader of the majority party or the leader of the majority coalition is appointed as Prime Minister by the monarch to serve a five-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementing of the law and running the day-to-day affairs of the country. The Council of Ministers (cabinet) is recommended by the Prime Minister and appointed by the monarch.
Luxemburg has a unicameral legislature. The parliament consists of Chamber of Deputies which has 60 seats; its members are elected by direct popular vote to serve five-year terms. There also exists a second body called Council of State appointed by the Grand Duke (composed of 21 ordinary citizens recommended by the Prime Minister) which advises the Chamber of Deputies in the drafting of legislation. Grande Duke has constitutional power to dissolve the parliament and reinstate a new one. Prime Minister can only recommend the dissolution of parliament to Grande Duke. Legislative power is vested in both the government and the parliament. The people of Luxemburg enjoy considerable political rights.
The judiciary in Luxemburg is independent, however its judges are appointed by the Grand Duke. The main source of the law is the constitution of 1868 (revised few times). The country’s legal system is based on civil law system. Luxemburg accepts compulsory ICJ jurisdiction. Being member of the European Union, the country’s national law needs to comply with the conditions of the Community legislation. The judicial languages used in Luxemburg are German and French.
Luxemburg is ruled by law. Foreign nationals can expect an impartial trial from the country’s judicial system. The country is largely free from corruption.
The language of justice: Luxembourg is a parliamentary democracy with a constitutional monarchy, ruled by a Grand Duke. Luxembourg (official name: Grand Duchy of Luxembourg) is the world's only sovereign Grand Duchy.
The chief of the state is the Grand Duke. The monarch is hereditary. Following popular parliamentary elections, the leader of the majority party or the leader of the majority coalition is appointed as Prime Minister by the monarch to serve a five-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementing of the law and running the day-to-day affairs of the country. The Council of Ministers (cabinet) is recommended by the Prime Minister and appointed by the monarch.
Luxemburg has a unicameral legislature. The parliament consists of Chamber of Deputies which has 60 seats; its members are elected by direct popular vote to serve five-year terms. There also exists a second body called Council of State appointed by the Grand Duke (composed of 21 ordinary citizens recommended by the Prime Minister) which advises the Chamber of Deputies in the drafting of legislation. Grande Duke has constitutional power to dissolve the parliament and reinstate a new one. Prime Minister can only recommend the dissolution of parliament to Grande Duke. Legislative power is vested in both the government and the parliament. The people of Luxemburg enjoy considerable political rights.
The judiciary in Luxemburg is independent, however its judges are appointed by the Grand Duke. The main source of the law is the constitution of 1868 (revised few times). The country’s legal system is based on civil law system. Luxemburg accepts compulsory ICJ jurisdiction. Being member of the European Union, the country’s national law needs to comply with the conditions of the Community legislation. The judicial languages used in Luxemburg are German and French.
Luxemburg is ruled by law. Foreign nationals can expect an impartial trial from the country’s judicial system. The country is largely free from corruption.
Having recourse to an interpreter: Luxembourg is a parliamentary democracy with a constitutional monarchy, ruled by a Grand Duke. Luxembourg (official name: Grand Duchy of Luxembourg) is the world's only sovereign Grand Duchy.
The chief of the state is the Grand Duke. The monarch is hereditary. Following popular parliamentary elections, the leader of the majority party or the leader of the majority coalition is appointed as Prime Minister by the monarch to serve a five-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementing of the law and running the day-to-day affairs of the country. The Council of Ministers (cabinet) is recommended by the Prime Minister and appointed by the monarch.
Luxemburg has a unicameral legislature. The parliament consists of Chamber of Deputies which has 60 seats; its members are elected by direct popular vote to serve five-year terms. There also exists a second body called Council of State appointed by the Grand Duke (composed of 21 ordinary citizens recommended by the Prime Minister) which advises the Chamber of Deputies in the drafting of legislation. Grande Duke has constitutional power to dissolve the parliament and reinstate a new one. Prime Minister can only recommend the dissolution of parliament to Grande Duke. Legislative power is vested in both the government and the parliament. The people of Luxemburg enjoy considerable political rights.
The judiciary in Luxemburg is independent, however its judges are appointed by the Grand Duke. The main source of the law is the constitution of 1868 (revised few times). The country’s legal system is based on civil law system. Luxemburg accepts compulsory ICJ jurisdiction. Being member of the European Union, the country’s national law needs to comply with the conditions of the Community legislation. The judicial languages used in Luxemburg are German and French.
Luxemburg is ruled by law. Foreign nationals can expect an impartial trial from the country’s judicial system. The country is largely free from corruption.
Sources of the law and legal similarities: Luxembourg is a parliamentary democracy with a constitutional monarchy, ruled by a Grand Duke. Luxembourg (official name: Grand Duchy of Luxembourg) is the world's only sovereign Grand Duchy.
The chief of the state is the Grand Duke. The monarch is hereditary. Following popular parliamentary elections, the leader of the majority party or the leader of the majority coalition is appointed as Prime Minister by the monarch to serve a five-year term. Prime Minister is the head of the government and enjoys the executive powers which include implementing of the law and running the day-to-day affairs of the country. The Council of Ministers (cabinet) is recommended by the Prime Minister and appointed by the monarch.
Luxemburg has a unicameral legislature. The parliament consists of Chamber of Deputies which has 60 seats; its members are elected by direct popular vote to serve five-year terms. There also exists a second body called Council of State appointed by the Grand Duke (composed of 21 ordinary citizens recommended by the Prime Minister) which advises the Chamber of Deputies in the drafting of legislation. Grande Duke has constitutional power to dissolve the parliament and reinstate a new one. Prime Minister can only recommend the dissolution of parliament to Grande Duke. Legislative power is vested in both the government and the parliament. The people of Luxemburg enjoy considerable political rights.
The judiciary in Luxemburg is independent, however its judges are appointed by the Grand Duke. The main source of the law is the constitution of 1868 (revised few times). The country’s legal system is based on civil law system. Luxemburg accepts compulsory ICJ jurisdiction. Being member of the European Union, the country’s national law needs to comply with the conditions of the Community legislation. The judicial languages used in Luxemburg are German and French.
Luxemburg is ruled by law. Foreign nationals can expect an impartial trial from the country’s judicial system. The country is largely free from corruption.

Intellectual Property

Domestic network and international agreements: The body in charge of the protection of intellectual property in Luxembourg is the Service of the Intellectual property of the Ministry of the Economy.
You can obtain information on patents and trademarks with the center of public research Henri Tudor.
Concerning industrial property, Luxembourg signed the Paris Convention.
Concerning trademarks, a single recording allows to protect these at the same time in Luxembourg, in Belgium and in the Netherlands.

Texts currently applying to patents/brands

Type	Text	Date entered into law	Period of validity	Remarks
Patent	Patent Law	May 24, 1998	20 ans	:
Trademark	Uniform Benelux Law on Marks	December 2, 1992	10 years, renewable for further 10-year periods	:
Design	Uniform Benelux Designs Law	July 13, 1973	:	:

Tax rates

Consumption taxes

Tax rate: 15%
Reduced tax rate: The reduced rates are the following: 3%, 6%, 12%.
The 3% rate applies to food, books and newspapers, pharmaceuticals, water, agricultural produce and some other items. The 6% rate applies to gas and electricity. The 12% rate applies to intellectual services, oils, wine and some other items.
Exports are zero-rated.
Some financial, health and medical services and leasing of immovable property are exempted of VAT.
Other consumption taxes: Excise duties are also levied on certain products, especially on spirit.

>> To get further information on VAT rates in Luxembourg, please check the list of VAT rates applied within the European Union, as well as the Government web site.

>> More detailed information on excise duties is available concerning alcoholic beverages, tobacco products, energy products on the European Commission website.

Corporate taxes

Tax rate on long-term capital gains: Capital gains and losses are generally treated as ordinary trading income and expense, subject to normal corporate tax. But some exceptions exist.
System governing groups of companies and dividends paid by subsidiaries to their parent companies: Dividends paid to residents or non-residents are subject to a tax rate of 20% (0% in case of international agreements) held at source.
Tax rate on branches: Branches are taxed as Luxembourgian companies are.

Sources of fiscal information

Tax Authorities: Administration des Douanes et Accises

Accounting rules

Tax year: The fiscal year begins on January 1st and ends on December 31 of the same year.
Accounting standards: BALANCE SHEET
A. Subscribed capital unpaid
B. Start-up costs
C. Fixed assets
C.I. Immaterial immobilizations
C.II. Physical immobilizations
C.III. Immobilization.
Accounting reports: The deposit of documents which have to be published is made to the Clerk's Office of courts, for the publishing to the Special Collection of Companies and Associations. The deposit must intervene within the month of the annual accounts' approval by the shareholders or associates.
Companies have to publish a balance sheet, a profit and loss account, an affectation of results proposal, the administrators and auditor's identity, an annual report and the report of the independent auditor.
Accountancy profession: The accountants' associations have difficulties to get organized because of the importance of the State in the accounting system.
Certification and auditing: The control of medium and big companies must be made by one or several independent auditors of companies, appointed by the general assembly among the members of the Institute of Independent Auditors of Companies.
The control of small companies must be made by an accountant appointed by the general assembly for definite duration.
The conclusion of the independent auditor's report can be:
- A certificate without reserve, that is to say an approval
- A certificate with reserves, that is to say that there is approval with reserves because of discords or doubts.
- A refusal to give a certificate.