The private limited liability company (S.à r.l.)

What is an S.à r.l.?

In an S.à r.l., the liability of the shareholders is limited to their contributions. It combines operational simplicity with legal protection, making it an ideal structure for starting a business.

It is commonly used for:

• SMEs;
• commercial or craft activities;
• family-owned or entrepreneurial businesses.

Incorporation requirements

1. Minimum share capital

Incorporating an S.à r.l. in Luxembourg requires a minimum share capital of €12,000. This capital must be fully paid up on incorporation and may be contributed in cash or in kind.

2. Number of shareholders

An S.à r.l. may be formed by a single shareholder (single-member S.à r.l.) or by several shareholders, up to 100. Shareholders may be individuals or legal entities.

3. Management

An S.à r.l. is managed by one or more managers, who may or may not be shareholders. Compared with an SA, the governance structure is simpler and less formal.

Incorporation steps

1. Drafting the articles of association

The articles of association define how the company operates: corporate purpose, registered office, distribution of shares and management rules. Careful drafting helps prevent many disputes between shareholders.

2. Deposit of share capital

The share capital is deposited with a Luxembourg bank, which issues a certificate confirming the deposit.

3. Notarial deed

As with an SA, the incorporation of an S.à r.l. requires a notarial deed. The notary verifies that the file is compliant and formalises the creation of the company.

4. Registration

The company is registered with the Luxembourg Trade and Companies Register (RCS), which grants it legal personality.

5. Publication

An extract of the articles of association is published in the Electronic Compendium of Companies and Associations (RESA), making the company official and enforceable against third parties.