Companies & entities
Setting up a SOPARFI in Luxembourg
A SOPARFI is an ordinary Luxembourg company (most often an SARL or an SA) whose activity consists of holding and financing participations. It benefits from the parent-subsidiary regime but must demonstrate genuine substance, in particular in light of the ATAD III directive. The firm structures the SOPARFI and secures its substance.
Legal content reviewed by Maître Cora Maglo, Avocate à la Cour, Liste I du Barreau de Luxembourg depuis 2009.
The SOPARFI (societe de participations financieres) is the classic vehicle for holding participations in Luxembourg. It is not a distinct corporate form: it is a commercial company whose corporate object is the management of participations.
The challenge lies not in incorporation but in substance and compliance: without sufficient substance, the benefits of the regime may be called into question. Cerno structures the SOPARFI and documents its substance.
The need
You hold, or are about to hold, participations and are looking for an efficient and compliant structure.
A holding company without genuine substance is increasingly exposed.
The risk
Reclassification, loss of the benefits of the parent-subsidiary regime, exposure under the ATAD III directive (shell companies).
Insufficient substance: the registered office, governance, resources and decision-making must be genuinely located in Luxembourg.
How we help
Structuring the SOPARFI, drafting the corporate documents and supporting governance, with particular attention paid to substance.
Assistance in assembling the ATAD III substance file.
Practice areas
When to call on the firm
- Hold participations in several companies.
- Finance a group through a Luxembourg holding company.
- Prepare a disposal or a reorganisation.
- Strengthen the substance of an existing holding company.
Method
Our engagement process
- 1
Information intake
You describe your need via a structured form or an initial call. Our digital tools serve only to organise this information and save time.
- 2
Lawyer qualification
Maître Maglo reviews your situation, identifies the legal issues and confirms the feasibility and exact scope of the engagement.
- 3
Transparent quote
You receive a clear fee proposal, a fixed fee or a range, before any engagement. Nothing is billed without your approval.
- 4
Legal work
The firm drafts, negotiates or litigates as required. Every deliverable is designed and approved by a lawyer admitted to the Luxembourg Bar.
- 5
Tracking and delivery
You follow your matter transparently and receive your finalised documents with the explanations you need.
Documents required
- • Mapping of the participations held
- • Holding and financing objectives
- • Existing substance elements
Deliverables
- • Structured SOPARFI
- • Articles of association and governance
- • ATAD III substance recommendations
Indicative timing
Incorporation is comparable to that of an SARL or SA; building substance is planned over the longer term.
On a quote basis
Depending on the complexity of the structure and the scope of the substance work.
The SOPARFI and ATAD III substance
The ATAD III directive targets conduit companies that lack substance. A SOPARFI must therefore have genuine substance: premises, effective governance in Luxembourg, resources and local decision-making.
The firm helps you assess your exposure and assemble a robust substance file.
FAQ
Frequently asked questions
Is the SOPARFI a separate legal form?
No. It is an ordinary commercial company (most often an SARL or an SA) whose corporate object is the holding of participations; it benefits from the parent-subsidiary regime.
What is the substance of a SOPARFI?
It is the set of genuine elements (registered office, governance, resources, local decision-making) that demonstrate the company is not a shell. ATAD III reinforces this requirement.
Can the firm audit my existing SOPARFI?
Yes. The firm carries out a substance review and proposes a compliance plan.
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- 2013
- independent firm
- 2009
- at the Bar since 2009
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Our work
Representative matters, anonymised
Typical examples of engagements handled by the firm, presented in an anonymised and illustrative manner. Each matter is handled and validated by a lawyer registered with the Luxembourg Bar.
A holding company and a residence permit, in a single process
Incorporation of a SOPARFI for a non-resident investor, combined with obtaining their residence permit. A single point of contact across both fronts.
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Cross-border recovery of unpaid debts for an SME, through an order for payment and coordination with a foreign colleague.
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Supporting an executive in a contested dismissal, from strategy to representation at the hearing.
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Negotiating and securing an international framework distribution agreement, from liabilities through to the competent jurisdiction.
Competent jurisdiction securedA similar matter?Typical, anonymised examples, for illustration only. They do not prejudge the outcome of a matter, which depends on each situation.
Entrust my matter to the firmExpertise & authority
Ongoing review and analysis of Luxembourg and European case law
Avocate à la Cour, List I of the Luxembourg Bar since 2009
Trained at the London School of Economics, formerly at Clifford Chance and Bonn Steichen & Partners
Member of international networks: EILN, AEA, Cross Border Advisory Solutions
Every matter handled and approved by a lawyer admitted to the Bar
Support in 7 languages, clients of 170 nationalities
Testimonials
What our clients say
Had a consultation with Me Cora Maglo about my Luxembourg Blue Card application. She explained everything clearly: the process, timeline and documents I need, and helped me with my wife’s family reunification too. Honest and practical advice. I felt confident after talking to her.Farshid Pourlatifi
J’ai beaucoup apprécié le service de Maître Maglo : son sérieux, sa sympathie, son professionnalisme et sa disponibilité. Toujours répondu rapidement et clairement, avec des conseils pragmatiques, sans pousser à des procédures longues et coûteuses lorsqu’elles ne sont pas justifiées.Nathan Wirtzfeld
Super assistance and great support! Highly recommend. All my questions were answered, Cora and her team kept me updated all the time. I will definitely reach out to them next time for my residency.Tatiana
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