Why should you buy a ready made company in Luxembourg?
Updated on Tuesday 18th January 2022
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Shelf companies or ready-made companies are a good choice for foreign investors who want to start doing business abroad because they don't have to wait until the company incorporation procedure is complete. Luxembourg is a very attractive country for investments and businesses, so foreign investors can find good business opportunities here and sign contracts with valuable business partners. By choosing to buy a ready-made company, foreigners can easily enter into these new business relationships faster than choosing to incorporate the legal entity. Our company incorporation specialists in Luxembourg can offer an in-depth presentation about shelf companies available in Luxembourg and about the ways in which you can acquire them. They can also help you with the whole company formation in Luxembourg process.
Legal entities available for shelf company
- limited liability company (SARL),
- public limited company (SA),
- special limited partnership (SCPs)
Time required for purchasing the company
A few days
Types of features it includes (corporate bank account, VAT number, etc)
- bank account,
- tax number,
- legal address,
- company documents
The advantages of a shelf company
- fast purchase & ownership transfer,
- access to bank loans,
- no debts,
- varied activities
Appointing new directors
Capital increase allowed
Certificate of no commercial activities
Modify the objects of activity
Participants in the purchase procedure
Buyer (or representative) & seller
The cost of buying a shelf company
Depending on the selected structure and the age of the shelf company
Buying a vintage company in Luxembourg
Buying a shelf company is a solution for businessmen who want to start trading as fast as possible. The incorporation procedure for a company in Luxembourg last about two weeks, if the documents are prepared and signed and the process is mandatory for all investors who want to open a new company in the country. The investor who purchases a company does not have to wait that long and he can begin the business activities in a just a couple of days, after the transfer of the company is complete.
A faster set-up procedure for a shelf company
Ready-made companies are chosen by businessmen who want to gain ownership of a company and skip the steps of registering a new one. Shelf companies are an option for businesses that need to acquire older companies, well-known in the market. The investors must be well informed regarding the company they intend to purchase in order to avoid any transactions that would prove to be risky or unprofitable. Other companies in Luxembourg can sometimes want to do business with companies that have been on the market for a longer time because they have more credibility and are more attractive to creditors. The corporate image of the ready-made company is already established and it will be easier to obtain loans if the firm is trustworthy and has no payment incidents. The company can be very well known on the local market or in other regions and this is a good start for businesses.
One of the most popular types of companies available for purchase in Luxembourg is the public limited company (SA). This business form has an important advantage for the investor: he is liable only to the extent of the amount invested in the corporation. This limited liability, as well as easy access to capital, are two of the most important characteristics of the public limited company. Other business options include the limited liability company (SARL).
Other advantages of shelf companies in Luxembourg
After they buy a shelf company, investors can submit a request for a bank loan. The bank will be more likely to approve the loan because the company shows a good payment history and no debts. A company that is two or three years old has a corporate credit history which can be presented at the bank. This maximizes the chances of obtaining new credit.
Our company registration agents in Luxembourg can help you purchase a company that has a clean debt record and that has not registered any bad payments in the past. This company due diligence procedure is very important for all investors who want to buy a shelf company. Together with our experts, you will be able to make a safe transaction and one that will allow you to continue that company’s business activities.
The ready-made company can be transferred to the investor very rapidly, usually on the same day. Upon purchase, the investor receives the company’s articles of association, a registered office, the incorporation certificate and all the documents needed for doing business. After the new company director receives these documents, he can start the required procedure of appointing new management for the company and even change the company name. Our specialists incompany registration in Luxembourg can help you buy a shelf company and complete the necessary formalities for the ownership transfer.
We invite you to watch a short video about purchasing a shelf company in Luxembourg, helped by our representatives:
Who can purchase a shelf company in Luxembourg?
Most of the international entrepreneurs who would rather get down to business as fast as possible instead of waiting for approvals and formalities in matters of business registration should look for the conditions of purchasing a vintage company in Luxembourg. This is the optimal choice for foreign investors who do not want to wait for the incorporation procedure of a company in Luxembourg. This is the main advantage of a shelf company in Luxembourg, the possibility of starting the activities as soon as the transfer of the ownership is concluded. Our company formation specialists in Luxembourg can provide information about the available shelf companies in Luxembourg you might be interested in. Likewise, they can handle the formalities on your behalf, in order for you to start the business in Luxembourg.
Do I need to travel to Luxembourg and by a ready-made company?
No, there is no need for you to travel to Luxembourg for the simple formalities of purchasing a vintage company. This is another important advantage related to the shelf companies in Luxembourg and international investors are pleased by the fact that such companies can be easily acquired if the personal identification documents are provided. This is a matter where our team of consultants can offer the needed support for all entrepreneurs who are interested in buying a vintage company in Luxembourg.
Do I need company due diligence for a shelf company in Luxembourg?
Even if it is not the case, you may solicit company due diligence in Luxembourg and find out all you need to know about the ready-made company you are about to purchase. Such a procedure will reveal if there are any hidden problems, unpaid fees or taxes and if the company has liabilities. There are shelf companies with no activities and other that have ceased the operations at a certain point. In such cases, a company due diligence may be requested by foreign investors who want to be sure that their future business will not be subject to any particular problem. We remind that shelf companies in Luxembourg present credibility in front of the financial institutions when asking for a loan, for example. Having no activities as an aged company will weigh much in front of a bank who can provide a loan with no additional requirements in terms of business.
The acquisition of a shelf company in Luxembourg
Domestic or foreign investors who want to buy a ready-made company in Luxembourg have fewer formalities to consider in this matter, such as:
• you can appoint our team of specialists in Luxembourg to represent you when buying a vintage company in Luxembourg;
• a set of copies of the valid personal identification documents are needed; these need to be notarized;
• the company documents need to be signed at the time you decide on a specific vintage company;
• as soon as the documents have been settled, the transfer of the ownership takes place.
The best part in this matter is that international entrepreneurs do not need to visit Luxembourg for purchasing a vintage company. Moreover, our representatives can act on their behalf and register the vintage company they choose for business in Luxembourg.
Are there any risks when acquiring a vintage company in Luxembourg?
No, you don’t need to worry about any risks when deciding for a buying a ready-made company in Luxembourg. These entities are registered just like any other company in Luxembourg, with respect to the applicable laws like the Company Law and the Commercial Code. Having no activities on the market means that there are no hidden problems or risks at the time the company is purchased.
How long does it take to buy a shelf company in Luxembourg?
There is no need for you to worry about the time the shelf company is transferred to you because such process is subject to fewer bureaucracies and therefore ready for business in approximately two days or less. This is an important advantage when it comes to the acquisition of a vintage company because the entrepreneurs have the chance to rapidly develop their activities on the market in Luxembourg, as soon as the transfer of the ownership took place. We remind that vintage companies are already incorporated entities with the entitled authorities and are kept on a shelf until they age, and they are purchased by someone. A shelf company can be used for most of the activities in Luxembourg, without specific restrictions, except the case of mineral resources which are subject to varied conditions stipulated by the legislation of this country.
You can get in touch with our team of company formation agents in Luxembourg and find out more details about the shelf companies you can purchase in Luxembourg.
The team from CompanyFormationLuxembourg.com is very qualified and benefits from extensive expertise in this area. I would definitely recommend them to any entrepreneur decided to start his own business here.
Mihai Cuc, Partner of Enescu&Cuc; Law Firm www.romanianlawoffice.com