On 19 August 2016, the new law of 10 August 2016 on the modernization of the company law was published in Luxembourg's Official Journal (Mémorial A, n° 167) following its adoption by Parliament on 13 July 2016. The new law will enter into force 3 days following this publication date, i.e., on 23 August 2016.
The new rules will become immediatly applicable on August 23, although companies incorporated before that date will benefit from a 2-year grace period to amend their articles of association.
Luxembourg’s modernisation of the Companies Act of 1915 was formally adopted on 13 July 2016, and includes changes to company liquidation, incorporation and capital increase procedures.
Three-step liquidation
On 9 July 2013 a new law amending the Code of Commerce was enacted in Luxembourg (the “Law”). The Law introduces the right for a depositor to claim the recovery of intangible and non-fungible (i.e., identifiable and separable) goods from a bankrupt company. The parliamentary file aims clearly at including data from a bankrupt cloud computing service provider. The Law sets forth the different conditions to be fulfilled for the entitlement to claim intangible and non-fungible goods from a bankrupt company:
Capital call subscription credit facilities (each, a “Facility”) continued their positive momentum in 2013 and had an excellent year as an asset class. As in the recent past, investor (“Investor”) funding performance remained as pristine as ever, and the only exclusion events we are aware of involved funding delinquencies by noninstitutional Investors (in many cases subsequently cured). Correspondingly, we were not consulted on a single Facility payment event of default in 2013.
Luxembourg court decisions allow secured lenders to enforce Gecina share pledge.
A controversial insolvency dispute winding its way through courts in Spain and Luxembourg may reinforce the rights of secured lenders to enforce financial collateral within an insolvency proceeding. While the recent Luxembourg Tribunal decision enforcing a financial collateral pledge for payment default appears to favor the secured lenders, a potentially contradictory decision from the Spanish Commercial Courts throws the issue into uncertain territory.
Suite aux faillites d’une quinzaine de boutiques au mois de septembre dernier au centre-ville de Luxembourg et partant du constat de la disparition progressive des commerces en centre-ville ainsi que d’une baisse de la création d’entreprises dans le secteur du commerce de détail, l’ancien gouvernement a émis un avant-projet de loi sur le bail commercial le 4 octobre 2013 (ci-après « l’avant-projet » ou le « projet »).
Le droit de la faillite au Grand-Duché de Luxembourg est actuellement régi par les articles 437 et suivants du Code de Commerce et s’inspire en grande partie du droit et de la jurisprudence belges. La législation applicable en matière de faillite n’a cependant que très peu évolué depuis 1935. Le législateur luxembourgeois, au vu du nombre croissant de faillites prononcées ces dernières années, avait d’ores et déjà tenté de réformer ce droit par l’introduction d’un projet de loi en 2003, resté cependant lettre morte.
INTRODUCTION
Luxembourg is one of the leading domiciles worldwide for international investment vehicles. This leading position has arisen from the combination of the following core factors:
RESTRUCTURING - COURT PROCEDURES
Formal, court-driven restructuring proceedings are available into Luxembourg law, but for practical reasons, these are rarely used in practice.
Reprieve from payment procedure (sursis de paiement)
Usual Luxembourg security package
Luxembourg is one of the leading domiciles worldwide for international investment portfolio acquisition vehicles.
Acquisition financing are usually secured against the assets and cash flows of the target company as well as of the buyout vehicle.
In practice, given that a Luxembourg holding company generally does not have any operational activities, shares, receivables and cash on bank are the most important assets to cover.