How to open a business bank account in Luxembourg
Opening a business account in Luxembourg is a straightforward process. However, it has unique features that can confuse a new business owner.
From the smallest to the largest, a corporate account is an essential part of any business. It is necessary for transactions, and in some cases its creation is a mandatory requirement for opening a business.
Every business in Luxembourg needs a business account, without exception. Even sole proprietors and self-employed persons are required to open an account to make payments, although in their case the process is not much different from opening a personal account.
In the case of SARL (analogous to LLC), SA (analogous to Ltds) and other types of companies, things are a bit more complicated: you need a company bank account to complete the company registration process. Without it, you won't be able to start and run a business.
If you are setting up a SARL or any other type of company, you will need a certain list of documents:
Luxembourg banks carefully follow the KYC — "Know Your Customer" procedure. Therefore, they have the right to ask you for any additional information they deem necessary. This can include information about the main contractors and examples of contracts with them, planned regions of work, and much more.
At first glance, the task may seem simple. In reality, however, it is not. Luxembourg is famous for its banking sector, so there are a lot of credit institutions here. Therefore, there are many banking products.
To choose the right bank, you should know a few key parameters:
It is worth remembering that a particular bank may work differently with individual entrepreneurs, small and medium businesses. As a rule, it is better to negotiate with several financial organizations at once, as many subtleties are not obvious at first.
Banks are very strict about the security and structure of documents. When you find a suitable financial institution, be prepared to sign several contracts.
The contract may be standard or customized, but must include the following elements:
- Rights and duties of the parties
The terms of the relationship between the Bank and the Client are set out below
- Fees and prices
All transactions for which a fee is charged must be specified in the contract
- Renewal and termination conditions
Please read this point carefully to avoid unpleasant situations
Never sign a contract if you are not sure about the content of a particular paragraph. If a controversial situation comes up, it is better to refuse and consult a professional lawyer.
To open a company in Luxembourg, you need to deposit share capital in your bank account. This is the key point of the whole process.
The authorized capital must be deposited into the account before signing the Articles of Incorporation. You will not be able to proceed with the company registration without this step.
You will need to prepare three documents:
- A certificate confirming the company name;
- Business license (issued if all requirements for obtaining it are met);
- Draft Articles of Association of the company to be established and a package of all documents required to open an account from Step 1.
Based on the draft charter, the bank will open an account that will be blocked for any transactions. You can make only the first deposit, which is the authorized capital. After that, the bank will issue a certificate of blocking.
The last step is to unlock the company account. To do this, you will need to:
- Present the Certificate of Blocking to the Notary
This serves as confirmation of the payment of the company's authorized capital.
- Complete the company registration
Complete the procedures, formulate and approve the Articles of Association, and obtain all the necessary documents
- Obtain a certificate of unfreezing of funds from a notary
The certificate is called a certificat de déblocage
- Submit a certificate of unfreezing to the bank
It must be accompanied by the final version of the deed and additional documents required by the bank
The bank will then make a final check and, if everything is in order, will unblock the account. After that, the company's capital can be managed independently.
Frequently Asked Questions (FAQ)
How long does it take to open a business account
Can I use a business account immediately after opening it
Is it possible to do without a business account in Luxembourg
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