Special Permits and Licenses in Luxembourg - Guide for Traders and Companies
Special Permits and Licenses for Trading CompaniesUpdated on Friday 23rd June 2023
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Starting a business in Luxembourg implies several stages and for some activities, the last one is obtaining a special license or permit. These operations are usually related to specific industries and are governed by certain laws.
Below, our lawyers in Luxembourg explain the conditions for obtaining business permits and licenses in the Grand Duchy. Should you open a company in an industry that requires this step, feel free to contact us for support.
The application procedure for obtaining a business permit in Luxembourg
The following documents must be submitted along with the request for the business permit:
- the professional qualification documents providing the fact that the entity is allowed to perform that activity,
- the documents which attest the professional integrity, a copy of an ID, proof of payment of the stamp duty (either a tax stamp or a proof of payment deposited in a specific account)
- a draft of the articles of association if the entity is a company.
The documents must be elaborated in German, French or English or accompanied by a translation in one of these languages. The application may be submitted through email or by standard mail to the General Directorate for SMEs and Entrepreneurship in Luxembourg.
Usually, a business permit is no longer valid in 2 years if it wasn’t used, if the activity was ceased for more than 2 years, if the entity is liquidated or if the business is bankrupted. The holder of the permit can request a new one if the company’s activities have changed, if the company has new directors or if it opens a branch in Luxembourg.
Certain business activities are regulated differently and individuals who perform them will need to obtain special permits and licenses. This applies to:
- self-employed individuals: for performing trade activities;
- lawyers, doctors, dentists, statutory auditors: these are liberal professions that may be subject to additional laws and requirements;
- craftspeople and those who sell their own products: are not required to have a business permit to sell their products but they must obtain this document if they wish to sell the items in fairs and markets.
Who needs to obtain a Luxembourg business permit?
Companies in Luxembourg will need to obtain certain permits for trade and other activities after they are incorporated. Most commercial, craft or certain professions in Luxembourg are subject to a prior right of establishment. The business permit is required from any person or entity wishing to conduct a business (trade, transport, catering), artisanal activity, industrial activity as well as for the exercise of certain professions (architect, engineer, accountant, economic Council, patent attorney, surveyor).
A license is required for the business permit carriers in the following cases: a change or extension of the corporate purpose, change the company manager on which the professional qualification transfer of a business from one municipality to another, when creating a branch.
Change of the legal form and / or the name of a legal entity do not require a new license but need to be notified to the Minister within one month after the change in question.
Artisans and manufacturers need to submit an application for receiving a business permit for skilled craftsmen. The application for this type of business is submitted to the General Directorate for SMEs and Entrepreneurship.
Considerations when applying for Luxembourg business permits
The business permit is granted to individuals who meet the dual requirement of good repute and professional qualifications and if the applicant is a corporate body, its officer or officers must meet this dual requirement. The repute is evaluated on the basis of the criminal record and all evidence provided by the administrative investigation while the qualification is assessed using the diplomas, certificates of course attendance, certificates of affiliation to social security and in the case of foreign companies, the certificates issued by the Member States of the European Union.
There are several exceptions applicable in certain conditions when the Ministry may exempt the applicant to prove their qualification when it comes to the opening of a small local trade if it proves that is conducted by one person assisted by the family members.
The request for a business permit can be made at the Chamber of Commerce trough the one stop shop initialized by it or my mail to the Department of Small and Medium Sized Businesses.
If the application is submitted online, the system will provide all the requirements for documents according to the candidate’s profile. A pre-filled business permit application form is generated in the first instance, followed by a detailed list of all the documents required for registration. The pre-filled business permit application form must be signed electronically and validated and re-send in the system.
After that, a pre-filled affiliation form to the Social Security administration form is released and a pre-filled VAT registration form which must be signed and submitted via the one stop shop or the traditional post office.
Industries that require special licenses and permits in Luxembourg
Anyone who wants to perform the following professional activities as an individual or under a Luxembourg company must obtain a business permit:
- craft activities such food, fashion, construction, mechanical engineering, audiovisual, entertainment, art, etc.);
- certain liberal professions that are primarily intellectual in character;
- commercial activities such as trade, HORECA (hotel, restaurant and café), transportation, industry, etc.;
- special industries such as telecommunications, finances, banking, investment, investment management, and insurance are subject to specific laws and special licensing requirements.
The procedure of obtaining a special license in Luxembourg is not complicated, however, the procedure must be approached with care in terms of documents. For this purpose, you can rely on our law firm in Luxembourg.
Special business permits for foreign citizens/companies with operations in Luxembourg
Businesses from the EU do not need a business permit to provide temporary services in Luxembourg. However, skilled producers and artisans must notify the General Directorate for Small and Medium-Sized Enterprises in advance on their activities.
Non-EU nationals who desire to establish themselves as independent contractors in Luxembourg must submit both their application for a stay authorization and their business permission. By doing this, they only need to submit one dossier to the Ministry of Immigration, who then gives the General Directorate for Small and Medium-Sized Enterprises control of the business permit section.
Apart from this, please mind that as a non-EU citizen, you will also require a residence permit for immigration to Luxembourg, even for temporary relocation.
Requirements when applying for a Luxembourg business license
Companies or tradespeople who apply for Luxembourg business permits must meet the requirements listed below:
- they must have professional integrity;
- they must also submit evidence of professional competence based on the selected activity;
- compliance with tax and business requirements: regardless of whether the business activities were carried out in their own name or through a company, the manager must not have evaded tax or business obligations in the past or at the moment;
- they must have a legal establishment in Luxembourg.
The business permit is granted only if there is a physical location in Luxembourg with infrastructure appropriate for the scope and nature of the relevant activity, as well as effective and ongoing management of the business by the permit holder.
Applications are usually processed within 3 months. After getting the Luxembourg business license, all correspondence, including letters, mail, emails, websites, invoices, and other official documents must include the authorization number.
You can get in touch with our Luxembourg lawyers for support in filing your application.
Our lawyers in Luxembourg invite you to watch a video about the mandatory permits and licenses:
Types of businesses operating in Luxembourg
According to recent data centralized by Statista.com, at the level of 2022:
- there were about 38,400 small and medium-sized companies operating in non-financial sectors;
- most of them were micro enterprises with less than 10 employees;
- the number of medium-sized businesses stood at 796.
Our law firm in Luxembourg can help you apply for a business permit and obtain all other additional licenses for performing various business activities. We are also at your disposal with support in immigrating to Luxembourg.
If you need to obtain permits and licenses for your business in other countries, such as Georgia or Russia, you may contact our local lawyers.