Family-operated (private) asset management company - (SPF)
Family-operated (Private) Asset Management Company
(FR: Societe de Gestion de Patrimoine Familial)
The SPF has existed in Luxembourg since 2007. It is the continuation model of the “Holding 1929“ which was prohibited by the European Commission – due to non-permissible state aid – and will expire at the end of the year 2010.
The SPF is not a new corporate structure, but instead a new tax statute already approved by the EU.
A “Holding-1929“ can be converted to an SPF by simply amending the statutes.
Legal structure
- The SPF is founded as a corporate entity – in practise, the forms “corporation” and "limited-liability company” will prevail.
- The company name must bear the affix "SPF".
- Nominal or bearer shares are permitted.
- The company is not required to be headquartered in Luxembourg. In the statutes, there must be a remark included that the company is subject to ”SPF legislation".
Partners
- Physical (actual) persons / trustees (resident or non-resident)
- Familial groups
- Investor groups
- Trusts
- Private foundations
Corporations are not permissible as partners.
Permissible activities
- This activity is limited to the purchase, holding, administration and collection of investments in financial instruments (in a broader context), including derivatives
i.e.: stocks, holdings, funds, futures, bonds, options, precious metals, bank accounts. - There are no investment limits, restrictions or minimum-stake quotas.
- The company can grant sureties, collateral and loans to affiliated companies, as long as this occurs free of charge.
- Advance payments on dividends are permissible.
- The company can – to an unlimited extent – take out loans from shareholders or foreign third parties and issue securities.
Non-permissible activities
- Any kind of commercial / trading activity
- Direct ownership of real estate
- Holding of patents or rights
- Administrative activity or financial services on behalf of third parties/affiliated companies
- Receipt of more than 5% of total dividend revenues from companies subject to a taxation of < 11%.
- Listing of the SPF shares (or their public offering) on the stock exchange.
However, the company can hold a stake in other structures which perform such activities.
Taxation
- Capital levy (1%), non-recurring, upon establishment, on the deposited capital (N / A in the year 2008)
- Subscription tax of 0.25% annually on the deposited capital (+ issuing bonuses)
- No DBA authorisation
- No VAT registration
- Complete exemption from corporate income tax, excise tax and assets tax
- No withholding tax on interest payments (restrictions apply to individuals)
- No withholding tax on dividend payments (non-residents)
- No taxation of capital profit arising from the sale of SPF shares (non-residents)
- No taxation of liquidation revenues from the SPF (non-residents)
Oversight / monitoring
- The SPF is not subject to any type of financial-market oversight. The so-called “Administration de l’Enregistrement et des Domaines" (Administration for Domain Registration) – not the tax administration in Luxembourg - has jurisdiction over such companies.
- The domicile agent must submit a report once annually to verify that the company’s activity remains within the legal framework.
- The SPF is protected by the Luxembourgian bank-confidentiality regulations.
