Best Venture Capital Lawyers in Sanem

About Venture Capital Law in Sanem, Luxembourg

Sanem is part of Luxembourg, a leading European jurisdiction for venture capital activity. While Sanem does not have municipal rules specific to venture capital, all venture capital formations, investments, and fundraising in Sanem follow Luxembourg national law and relevant European Union frameworks. Luxembourg offers flexible investment vehicles, a predictable regulatory environment, and a deep ecosystem of service providers, which makes it attractive for setting up funds and for financing startups and growth companies.

Most venture capital structures rely on Luxembourg company and partnership forms, together with dedicated investment fund regimes. Deals commonly use shareholder agreements and convertible instruments suited to fast growth companies, and managers benefit from EU rules on marketing and management of alternative investment funds.

Why You May Need a Lawyer

Even straightforward venture capital matters involve multiple legal layers. A lawyer with Luxembourg venture capital experience can help you navigate:

- Choosing and forming the right vehicle, such as a special limited partnership or a fund regime tailored to professional investors.

- Regulatory scoping under the Alternative Investment Fund Managers framework, including whether you need an authorized AIFM, a depositary, and what reporting applies.

- Term sheet negotiation, valuation protections, liquidation preferences, anti-dilution provisions, governance rights, and exit mechanics.

- Drafting and negotiating key documents such as limited partnership agreements, private placement memoranda, subscription agreements, and shareholder agreements.

- Tax analysis for the fund, its managers, and investors, including use of tax transparent entities and application of participation exemption rules.

- Cross-border fundraising and marketing compliance, including pre-marketing notifications and investor eligibility checks.

- Portfolio company investments, due diligence, IP assignments, employment and incentive plans, data protection, and regulatory licenses relevant to the company’s sector.

- Ongoing compliance, anti-money laundering obligations, register of beneficial owners filings, and annual reporting.

- Dispute prevention and resolution, including enforcement of rights, buy-sell arrangements, and settlement of founder or investor disputes.

Local Laws Overview

Corporate forms and fund vehicles:

- Special limited partnership SCSp and common limited partnership SCS are widely used for venture capital funds and co-investment vehicles. The SCSp can be formed by private deed and offers contractual flexibility. Limited partners have limited liability and the vehicle can be set up to be tax transparent.

- Company forms frequently used for portfolio companies and holding entities include the private limited liability company Sàrl and the public limited company SA. Sàrl requires notarial incorporation and a minimum share capital. SA suits larger or later-stage structures.

- Dedicated fund regimes include the Reserved Alternative Investment Fund RAIF, the Specialized Investment Fund SIF, and the Investment Company in Risk Capital SICAR. SIF and SICAR require authorization and supervision by the Commission de Surveillance du Secteur Financier CSSF. RAIF does not require prior CSSF authorization but must appoint an external authorized AIFM and is indirectly supervised through that AIFM.

Regulatory framework:

- The Alternative Investment Fund Managers Law implements the EU AIFMD. It governs manager authorization, delegation, depositary duties, valuation, risk management, leverage, transparency, and investor reporting.

- RAIF and SIF typically target well-informed investors, which generally means professional investors or others meeting a minimum investment amount and suitability assessment.

- EU regimes such as EuVECA and ELTIF may be relevant depending on strategy and target investors. EuVECA can facilitate cross-EU marketing by smaller managers that meet the EuVECA conditions. ELTIF can in some cases be marketed to retail investors subject to specific rules.

Tax and fees overview:

- SIF and RAIF with SIF-like features are typically exempt from income and net wealth taxes, subject instead to an annual subscription tax on net assets. SICAR is generally fully taxable but income from risk capital is exempt, yielding a similar outcome for qualifying investments.

- Luxembourg commonly allows tax transparent arrangements for SCSp if properly structured. Investor-level taxation then depends on the investor’s jurisdiction and applicable treaties.

- Management of qualifying funds benefits from a VAT exemption. Other services may attract VAT depending on their nature and provider status.

Marketing and distribution:

- Marketing to professional investors in other EU states typically relies on the AIFMD passport if the AIFM is authorized. Non-EU or sub-threshold managers may rely on national private placement regimes where available and must comply with Luxembourg and investor jurisdiction rules.

- Pre-marketing to test investor interest is possible under EU rules, following notification by the AIFM to its home regulator. Once marketing begins, full AIFMD requirements apply.

Governance and compliance:

- Funds must appoint an auditor and generally a depositary. Appointment of an administrator and registrar is customary. Policies on valuation, conflicts, remuneration, risk management, and ESG disclosures are often required or expected by investors.

- Anti-money laundering and counter-terrorist financing laws apply to funds, managers, and service providers. Know-your-customer processes and screening are mandatory.

- Entities must register with the Luxembourg Business Registers and maintain filings in the Register of Beneficial Owners where applicable. Many filings can be made in English, French, or German.

Local practice and operations:

- Notarization is required for SA and Sàrl incorporations. SCSp may be created by private deed. Formation and bank account opening times vary based on due diligence and service provider availability.

- Documentation can be drafted in English. Day-to-day practice commonly uses English and French, with German and Luxembourgish also used.

Frequently Asked Questions

Is there any Sanem-specific rule for venture capital, or do national laws apply?

National Luxembourg law applies. Sanem has no separate municipal venture capital regime. Structures, licensing, and filings are handled at the national level through Luxembourg authorities and registries.

What is the most common fund vehicle for venture capital in Luxembourg?

The SCSp is widely used due to its contractual flexibility and potential tax transparency. It is often combined with a RAIF, SIF, or SICAR regime depending on the strategy and investor base. Many managers choose a RAIF with an external authorized AIFM for speed to market and EU distribution options.

How quickly can I set up a RAIF in Luxembourg?

Assuming key parties are in place, KYC is complete, and documents are advanced, practical timelines are often 4 to 8 weeks from term sheet to first close. Complex structures, bank account opening, or cross-border approvals can extend this.

Do I need an authorized AIFM to manage a venture capital fund?

If your fund qualifies as an AIF and exceeds manager thresholds, you generally need an authorized AIFM. A RAIF always requires an external authorized AIFM. Sub-threshold managers may register and use regimes like EuVECA if eligible, but should obtain legal advice on limits and investor marketing rules.

Who can invest in a Luxembourg venture capital fund?

Most Luxembourg venture capital funds target well-informed investors, typically professional investors. Others may invest if they meet a minimum commitment and pass suitability checks. Retail access is limited and usually requires a specific product such as an ELTIF that is designed for retail distribution.

What documents will investors expect during fundraising?

Key documents include the private placement memorandum, limited partnership agreement or fund statutes, subscription documents, side letter templates, and due diligence materials such as the manager’s track record, ESG policies, valuation policy, and regulatory disclosures.

What are the main tax features of Luxembourg VC funds?

RAIF and SIF vehicles typically pay a low annual subscription tax on net assets and are otherwise tax exempt at fund level. SICAR is fully taxable but income from qualifying risk capital is exempt. SCSp and similar partnerships can be tax transparent if structured properly. Investor taxation depends on their jurisdiction, legal form, and any applicable treaty benefits.

Can I market my fund across the EU from Luxembourg?

Yes, if you have an authorized AIFM you can use the AIFMD passport to market to professional investors across participating EU states. If you are sub-threshold or non-EU, you may rely on national private placement regimes subject to conditions. Pre-marketing is available subject to notification rules.

What about investing directly in startups in Sanem?

You can invest through a holding company or special purpose vehicle such as a Sàrl or SCSp. You should use robust shareholder agreements, ensure IP is properly assigned, and implement founder vesting and employee incentive plans. A local lawyer can align documents with Luxembourg practice and investor expectations.

Which service providers do I need in Luxembourg?

Expect to appoint a legal counsel, notary for certain incorporations, auditor, fund administrator, depositary for in-scope funds, and a regulated AIFM if required. You may also engage tax advisers and compliance specialists. Choosing providers with venture capital experience will streamline timelines and reduce friction.

Additional Resources

Commission de Surveillance du Secteur Financier CSSF - Luxembourg’s financial regulator overseeing authorized funds, managers, and certain service providers.

Luxembourg Business Registers RCS and the Register of Beneficial Owners - Central registries for company filings and beneficial ownership disclosures.

Guichet.lu - The government’s business portal providing guidance on company formation, licensing, and administrative procedures.

Luxembourg Private Equity and Venture Capital Association LPEA - Industry body offering market insights and best practice materials for private equity and venture capital.

Luxinnovation - National innovation agency that connects startups, investors, and public programs and can orient founders toward funding options.

House of Entrepreneurship and local chambers of commerce - First-stop support for founders on business setup, permits, and contacts.

Notaries of Luxembourg - Public officers who execute notarial deeds required for certain company formations and amendments.

Ministry of the Economy and Ministry of Finance - Policy and legislative references for enterprise, financial sector rules, and investment climate.

University of Luxembourg startup and research ecosystem - Useful for deal flow and collaborations in the Greater Region near Sanem.

Next Steps

1 - Define your objectives. Clarify whether you are creating a fund, a co-investment vehicle, or making a direct investment. Identify target investors, ticket sizes, timeline, and any cross-border elements.

2 - Seek a scoping call with a Luxembourg venture capital lawyer. Request a high-level regulatory and tax map that covers vehicle choice, AIFM and depositary needs, investor eligibility, and expected filings.

3 - Choose the vehicle and service package. Decide between SCSp, Sàrl, SA, or a fund regime such as RAIF, SIF, or SICAR. Line up an AIFM if needed, plus administrator, depositary, auditor, bank, and registered office provider.

4 - Prepare documentation. Have your counsel draft the term sheet, fund or company constitutional documents, limited partnership agreement, shareholder agreement, private placement memorandum, subscription pack, and policies on valuation, conflicts, and AML.

5 - Complete KYC and onboarding. Gather identification, source of funds, and corporate documentation early to avoid delays with banks and service providers.

6 - Plan tax and governance. Confirm whether you aim for tax transparency or fund-level exemptions. Set governance rules for investment committees, conflicts, and reporting to investors.

7 - Manage marketing compliance. If you intend to pre-market or market in other EU states, coordinate with your AIFM and counsel on notifications, investor categorization, and offering materials.

8 - Close and operate. Execute first close, admit investors, and ensure recurring compliance with regulatory reporting, audits, RBO updates, and annual filings.

If you are unsure where to begin, start with a brief consultation with a Luxembourg venture capital lawyer. Bring a one-page summary of your goals, structure preferences, and investor profile. This will help you receive targeted advice and a realistic timeline and budget for your venture capital project in Sanem.