Incorporating A Luxembourg SARL In Cash Without A Bank Account: Now Possible – Luxembourg Introduces Deferred Payment Of Minimum Share Capital

With the entry into force on 2 June 2026 of the law of 18 May 2026¹ (“the “Law”), the Luxembourg law of 10 August 1915 on commercial companies (the “Company Law”) has been amended to allow founders of newly incorporated private limited liability companies (sociétés à responsabilité limitées – “SARL”) (including simplified SARLs) to defer the cash payment (libération) of the EUR 12,000 minimum share capital for up to 12 months following incorporation.

While the general SARL regime has largely remained untouched, Luxembourg’s legislator has introduced welcome flexibility to address a simple objective: if you urgently need to incorporate a SARL with minimum share capital, there is now an easy way to go, even without a bank account.

Background: a welcome ‘hotfix’ to an aging SARL regime

With over 78,000 SARLs registered with the Luxembourg Trade and Companies Register², the SARL remains by far the favourite corporate form for most businesses. However, the nearly centenarian vehicle was facing an increasingly challenging reality: opening a bank account for the purpose of depositing the share capital has become significantly more complex.

Since its inception in 1933, the SARL’s rules on share capital and initial subscription were rather simple: founders were required to fully subscribe and immediately pay-up all issued shares at incorporation. In practice, this could either be achieved through a contribution in kind (apport en nature) or through a contribution in cash (apport en numéraire). In the latter case, the company would have needed a bank account opened on which the funds for subscription would have been blocked until the incorporation.

While this worked for decades, the recent evolution of Luxembourg’s corporate banking industry and practices, where opening a bank account could take several weeks to months, turned such requirements into a real frustration in a business environment focused on flexibility and where things need to move fast, especially for investments purposes.

Luxembourg’s neighbouring jurisdictions had (long) taken action to modernise their local regimes by facilitating initial share capital subscriptions (certain jurisdictions, such as Belgium or the Netherlands pushing even beyond by simply removing the requirement for a minimum share capital).

It was now time for Luxembourg to catch up with a prudent, yet efficient approach aimed at facilitating quick SARL launch, without reducing the statutory minimum capital or weakening safeguards.

For smaller businesses and individuals, and especially for SARL-S, this also means that the need for immediate funding is removed so that they can start their business immediately and subsequently pay up the share capital as funds become available.

What has changed and what has not?

The changes introduced by the Law are limited to targeted amendments to articles 710-6, 710-7 and 720-4 of the Company Law. You can find a markup of the amended provisions here for reference.

As briefly pointed out, it is important to keep in mind that this new option for deferred payment of SARL’s initial share capital is strictly limited to:

• the payment of the initial share capital upon incorporation;
• within the limits of the amount of the minimum share capital set forth under the Company Law (i.e. EUR 12,000 for SARLs – and for SARL-S, such amount as comprised between EUR 1.- and EUR 12,000);
• where payment is solely made by means of cash contribution(s) (apport(s) en numéraire); and
• to the exclusion of any share premium.

This means that all other aspects relating to the incorporation, subscription and payment of shares of SARLs remain untouched. In particular, the incorporation of a SARL will still require that its share capital be fully subscribed, the notary will still attest to the compliance of the provisions of the Company Law (including new conditions relating to deferred payment, where applicable) and full AML/KYC checks will still be carried out.

Moreover, the following still need to be immediately paid (libéré/versé) in full and are not eligible for any deferral:

• any subscription by means of contributions in kind (apports en nature);
• any amount exceeding the minimum share capital amount (i.e. any amount exceeding EUR 12,000);
• any share premium; and
• any share capital increase/share issuance taking place after incorporation.

Below are some simplified illustrative scenarios.

In essence, these examples highlight that the only scenario in which recourse to deferred payment would make sense is that of a simple SARL with minimum share capital and no share premium. In other cases, the prior opening of a bank account would ultimately be required (save for contributions in kind), rendering any deferral likely unnecessary.

The deferred payment of minimum share capital in practice:

The amended articles (710-6, 710-7 and 720-4 of the Company Law) under which the option for deferred payment of minimum share capital is set forth, provide for general rules applying to such option while leaving flexibility for each company to detail the related modalities in their articles of association.

In practice, founders would, upon incorporation, establish in the articles:

• whether they want to reduce the time frame allowed for deferred payment of share capital (e.g. 6 months instead of the maximum 12 months offered under the Law); and
• payment modalities (e.g. fixed dates or calls by the management at their discretion).

The Company Law further clarifies and provides that:

• the management (gérance) will be responsible for calling unpaid capital;
• if payment has become due and has been validly called but not made, voting rights attached to the unpaid shares are suspended until payment;
• a list of the shareholders who have not yet fully paid up their capital shares, indicating the amounts they owe, shall be published following the balance sheet;
• each shareholder shall remain liable for the amount of its shares.

Conclusion

While the introduction of deferred payment significantly facilitates the incorporation process, some stakeholders have pointed to a perceived lack of ambition in the reform, noting that it addresses only part of a broader structural issue and noting that other routes could have been explored to provide a larger refresh of the SARL regime.

Moreover, it does not, in itself, resolve the practical challenges associated with the opening of bank accounts, which remain a key prerequisite for the proper operation of any Luxembourg company. Calls for actions in such respect were again formulated in the context of the parliamentary process leading to the adoption of the Law and it is undeniable that this remains a priority for the market.

Notwithstanding these observations, the changes introduced by the Law surely constitute a welcome and pragmatic evolution of the SARL regime, enhancing Luxembourg’s competitiveness and providing a concrete solution to a widely acknowledged market constraint.

Footnotes

1. Law of 18 May 2026 amending the Company Law with a view to introducing deferred payment of the minimum share capital for limited liability companies (Loi du 18 mai 2026 portant modification de la loi modifiée du 10 août 1915 concernant les sociétés commerciales en vue de l’instauration de la libération différée du capital social minimum des sociétés à responsabilité limitée – available at: https://legilux.public.lu/eli/etat/leg/loi/2026/05/18/a266/jo).

2. Source: Luxembourg Business Registers (LBR), Statistiques – Registre de commerce et des sociétés, online dashboard (data as at 30 March 2026), available at: https://www.lbr.lu/mjrcs-web-front/statistiques-dashboard (last consulted on 1 June 2026)

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