Legal structure of a Branch Office in Luxembourg

1. Concept

A Branch Office in Luxembourg is a permanent establishment which is geographically separated from the main business in a domestic or non-domestic Trading Company. From a business management point of view, it is a independent company carrying on commercial activities in Luxembourg which is fully authorised to conclude sales contracts. Legally, the Branch Office is seen as part of the Head Office due to it not having its own legal personality. The liability of the Branch Office for the liabilities of the Branch Office in Luxembourg is consequently unlimited. If the Head Office is a foreign company, the internal constitution of a Branch Office should be in accordance with the articles of association of the Head Office of the business and the particular foreign law.

2. Formation

A Branch Office in Luxembourg is formed through the resolution of the management of the Head Office and through registration in Luxembourg’s Trade and Companies Register. Therein, the said registration is of declaratory effect only. It is not required that a Branch Office in Luxembourg have an articles of association and the articles of association of the principal place of business shall be published in the Official Bulletin (Mémorial C). Moreover, the furnishing of the Branch Office with capital can be freely organised. A Trade Licence is required to be obtained by a Branch Office from Luxembourg’s Ministry of the Middle Classes, Tourism and Housing for the carrying on of commercial activities.

3. Name

The name of a Branch Office in Luxembourg must contain at least a description of the Head Office as well as the corresponding legal abbreviation in unaltered form.

4. Representation

A Branch Office in Luxembourg is independently represented by the Branch Office manager vis-à-vis third parties. Notwithstanding this, the appointment of a Branch Office manager is not mandatory. An authorised signatory of the company, registered in Luxembourg”s Trade and Companies Register, can accordingly be appointed to represent the Branch Office.

Tax structure of a Branch Office in Luxembourg

A Branch Office in Luxembourg is liable as a permanent establishment to the standard tax for profits made there and consequently benefits from Luxembourg’s preferential taxation. Moreover, the Branch Office may repatriate the said profits to the country in which its Head Office is located free from tax.


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A company in Luxembourg must obtain written consent (a trade licence) from Luxembourg's Ministry of Small and Medium-sized Businesses prior to the carrying on of industrial, skilled trade or any other commercial activities. Moreover, it is required to register the business with Luxembourg's tax authority and to apply for a tax number.

Certain requirements must be fulfilled for the granting of a trade licence. The managing director or the manager must accordingly possess the corresponding qualifications and professional experience for the particular activity. Furthermore, the company must have a physical presence in Luxembourg (registered office or office).