{"id":44192,"date":"2017-11-26T16:10:56","date_gmt":"2017-11-26T14:10:56","guid":{"rendered":"https:\/\/newserver.fyb.de\/produkt\/luxembourg-as-a-holding-location-luxembourg-law-as-an-opportunity-but-also-as-a-potential-danger-for-investors\/"},"modified":"2017-11-26T16:10:56","modified_gmt":"2017-11-26T14:10:56","slug":"holding-location-luxembourg-luxembourg-law-as-opportunity-but-also-as-potential-danger-for-investors","status":"publish","type":"product","link":"https:\/\/www.fyb.de\/en\/produkt\/holding-location-luxembourg-luxembourg-law-as-opportunity-but-also-as-potential-danger-for-investors\/","title":{"rendered":"Luxembourg as a Holding Location \u2014 Luxembourg Law as an Opportunity, but also as a Potential Danger for Investors"},"content":{"rendered":"<p><strong>Prof. Dr. Gerhard Schmidt<\/strong> \u2014 Attor\u00adney at Law and Part\u00adner Weil, Gotshal &amp; Manges LLP, Frankfurt\/Main<\/p>\n<p> <strong> Britta Grauke<\/strong> \u2014 Attor\u00adney at Law and Part\u00adner Weil, Gotshal &amp; Manges LLP, Frankfurt\/Main<\/p>\n<p> <strong> Tobias Geer\u00adling<\/strong> \u2014 Attor\u00adney at Law and Part\u00adner Weil, Gotshal &amp; Manges LLP, Munich<\/p>\n<p><strong>Michael Kohl<\/strong> \u2014 Attor\u00adney at Law and Senior Asso\u00adciate Weil, Gotshal &amp; Manges LLP, Frankfurt\/Main<\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong>For funds as well as for private equity inves\u00adtors and mezza\u00adnine lenders, a Luxem\u00adbourg holding and\/or fund struc\u00adture is highly popu\u00adlar. Today, Luxem\u00adbourg is proba\u00adbly the largest fund center in Europe and number two in the world after the USA. At the same time, many Euro\u00adpean private equity inves\u00adtors are acqui\u00adring assets across Europe through Luxem\u00adbourg holding struc\u00adtures. Here, it is important to take a close look at the posi\u00adtive effects but also the possi\u00adble dangers.<\/strong><\/p>\n<p>The most common buzzwords used to describe the advan\u00adta\u00adges of Luxem\u00adbourg struc\u00adtures&nbsp;are:<\/p>\n<ul>\n<li>Tax bene\u00adfits both on divi\u00addend receipt and on subse\u00adquent sale of the asset and no rest\u00adric\u00adtion on tax deduc\u00adti\u00adbi\u00adlity of debt interest,<\/li>\n<li>no exces\u00adsive regulation,<\/li>\n<li>poli\u00adti\u00adcal and econo\u00admic stabi\u00adlity,&nbsp;and<\/li>\n<li>highly skil\u00adled, multi\u00adl\u00adin\u00adgual workforce.<\/li>\n<\/ul>\n<p>With one quali\u00adfi\u00adca\u00adtion or another, these advan\u00adta\u00adges are rightly mentio\u00adned. In addi\u00adtion, there are some special advan\u00adta\u00adges of Luxem\u00adbourg law, which are quite signi\u00adfi\u00adcant in times of econo\u00admic crisis. For exam\u00adple, in the case of a Luxem\u00adbourg holding struc\u00adture, it may be inte\u00adres\u00adt\u00ading for plan\u00adning purpo\u00adses that in Luxem\u00adbourg insol\u00advency law over-indeb\u00adted\u00adness alone is not a ground for insol\u00advency. In addi\u00adtion to an exis\u00adting inabi\u00adlity to pay (illi\u00adqui\u00addity), the loss of credit\u00adwort\u00adhi\u00adness is neces\u00adsary. The insol\u00advency filing obli\u00adga\u00adti\u00adons are also much less strict than under German law. Moreo\u00adver, it is often advan\u00adta\u00adge\u00adous for share\u00adhol\u00adders that Luxem\u00adbourg law does not contain any equity substi\u00adtu\u00adtion rules compa\u00adra\u00adble to German law. Further\u00admore, the problem of a taxa\u00adble reor\u00adga\u00adniza\u00adtion gain, which regu\u00adlarly arises in the case of debt-for-equity swaps or the acqui\u00adsi\u00adtion of loans for the purpose of acqui\u00adring control (loan-to-own), does not exist in Luxem\u00adbourg. For these reasons, the targe\u00adted use of Luxem\u00adbourg law can be very attrac\u00adtive. It may also still make sense during ongo\u00ading invest\u00adment manage\u00adment to trans\u00adfer assets\/companies to Luxem\u00adbourg (for exam\u00adple, by means of a merger across the border).<\/p>\n","protected":false},"featured_media":41215,"comment_status":"open","ping_status":"closed","template":"","meta":{"wp_typography_post_enhancements_disabled":false},"product_brand":[],"product_cat":[2452,2506,2598,2599,2600,2601],"product_tag":[1984,1985,1987,1992,1998,2005,2008],"class_list":{"0":"post-44192","1":"product","2":"type-product","3":"status-publish","4":"has-post-thumbnail","6":"product_cat-ebook-en","7":"product_cat-fyb-2011-en","8":"product_cat-prof-dr-gerhard-schmidt-en","9":"product_cat-britta-grauke-en","10":"product_cat-tobias-geerling-en","11":"product_cat-michael-kohl-en","12":"product_tag-gerhard-schmidt-en","13":"product_tag-britta-greyke","14":"product_tag-tobias-geerling-en","15":"product_tag-private-equity-investors","16":"product_tag-mezzanine-lenders","17":"product_tag-luxembourg-holding-structures","18":"product_tag-michael-kohl-en","19":"pa_sprache-english-3","20":"pa_sprache-german","22":"first","23":"outofstock","24":"taxable","25":"shipping-taxable","26":"purchasable","27":"product-type-variable"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Luxembourg as a Holding Location - Luxembourg Law as an Opportunity, but also as a Potential Danger for Investors - FYB Financial Yearbook<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fyb.de\/en\/produkt\/holding-location-luxembourg-luxembourg-law-as-opportunity-but-also-as-potential-danger-for-investors\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Luxembourg as a Holding Location - Luxembourg Law as an Opportunity, but also as a Potential Danger for Investors - FYB Financial Yearbook\" \/>\n<meta property=\"og:description\" content=\"For funds as well as for private equity investors and mezzanine lenders, a Luxembourg holding and\/or fund structure is highly popular. Today, Luxembourg is probably the largest fund center in Europe and number two in the world after the USA. At the same time, many European private equity investors are acquiring assets across Europe through Luxembourg holding structures. Here, it is important to take a close look at the positive effects but also the possible dangers. The most common buzzwords used to describe the advantages of Luxembourg structures are:  Tax benefits both on dividend receipt and on subsequent sale of the asset and no restriction on tax deductibility of debt interest,  no excessive regulation,  political and economic stability, and  highly skilled, multilingual workforce. With one qualification or another, these advantages are rightly mentioned. In addition, there are some special advantages of Luxembourg law, which are quite significant in times of economic crisis. For example, in the case of a Luxembourg holding structure, it may be interesting for planning purposes that in Luxembourg insolvency law over-indebtedness alone is not a ground for insolvency. In addition to an existing inability to pay (illiquidity), the loss of creditworthiness is necessary. The insolvency filing obligations are also much less strict than under German law. Moreover, it is often advantageous for shareholders that Luxembourg law does not contain any equity substitution rules comparable to German law. Furthermore, the problem of a taxable reorganization gain, which regularly arises in the case of debt-for-equity swaps or the acquisition of loans for the purpose of acquiring control (loan-to-own), does not exist in Luxembourg. For these reasons, the targeted use of Luxembourg law can be very attractive. It may also still make sense during ongoing investment management to transfer assets\/companies to Luxembourg (for example, by means of a merger across the border).\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.fyb.de\/en\/produkt\/holding-location-luxembourg-luxembourg-law-as-opportunity-but-also-as-potential-danger-for-investors\/\" \/>\n<meta property=\"og:site_name\" content=\"FYB Financial Yearbook\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.fyb.de\/wp-content\/uploads\/2017\/07\/Schmidt.png\" \/>\n\t<meta property=\"og:image:width\" content=\"334\" \/>\n\t<meta property=\"og:image:height\" content=\"298\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/holding-location-luxembourg-luxembourg-law-as-opportunity-but-also-as-potential-danger-for-investors\/\",\"url\":\"https:\/\/www.fyb.de\/en\/produkt\/holding-location-luxembourg-luxembourg-law-as-opportunity-but-also-as-potential-danger-for-investors\/\",\"name\":\"Luxembourg as a Holding Location - 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Today, Luxembourg is probably the largest fund center in Europe and number two in the world after the USA. At the same time, many European private equity investors are acquiring assets across Europe through Luxembourg holding structures. Here, it is important to take a close look at the positive effects but also the possible dangers. The most common buzzwords used to describe the advantages of Luxembourg structures are:  Tax benefits both on dividend receipt and on subsequent sale of the asset and no restriction on tax deductibility of debt interest,  no excessive regulation,  political and economic stability, and  highly skilled, multilingual workforce. With one qualification or another, these advantages are rightly mentioned. In addition, there are some special advantages of Luxembourg law, which are quite significant in times of economic crisis. 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