Luxembourg limited partnership

Partnerships created by the Companies Law

The Luxembourg law on commercial companies of 10 August 1915 (the “Companies Law”) until recently recognized only two forms of limited partnership, each of these having a separate legal personality:

• The corporate partnership limited by shares (société en commandite par actions or “SCA”), which is a joint-stock company whose capital is represented by shares in principle freely transferable; and
• The common limited partnership (société en commandite simple or “SCS”), which is an “intuitu personae” company issuing limited partnership interests that in general are not freely transferable.

Partnerships created by the AIFMD Law

The Luxembourg law of 12 July 2013 on alternative investment fund managers (the “AIFMD Law”) transposing the AIFMD into Luxembourg law amends the SCS regime and introduces a third form of limited partnership into the Companies Law:

• The special limited partnership (société en commandite spéciale or “SCSp”). Unlike the SCS and SCA, which both are intuitu personae entities, the SCSp has no legal personality distinct from its partners, and may have a different treatment therefore for netting purposes (in otherwords, check your opinion to make sure it covers an SCSp).

Whereas assets contributed to the SCS are owned by the SCS itself, assets contributed to an SCSp are owned by its partners, but the Companies Law explicitly provides that they can be recorded in the name of the SCSp, and those assets can only satisfy claims in relation to the creation, conduct or dissolution of the SCSp. As a result:

• A creditor with a personal claim against a partner of an SCSp cannot make a claim against assets owned by that partner that are attributable to the SCSp.
• The SCSp will have its own creditors and may be entitled under the partnership agreement to borrow for its own account. Despite the absence of a legal personality, the SCSp benefits from other features generally attached to the legal personality – for example, it has its own registered office and it can sue and be sued. But check that you have a close out netting opinion in place. (Did I already say that?)