Alert May 12, 2020

Luxembourg response to COVID-19: Extensions for Accounting Obligations

Luxembourg parliament has recently adopted two new laws to provide headroom to operating businesses and funds in respect of their accounting obligations.

The extensions granted under these new laws will only apply to filings and publications that (i) were not due before the declaration of state of crisis for a three month period in Luxembourg (i.e., 18 March 2020) and (ii) relate to periods ended before the end of such state of crisis.

I. Extension of certain deadlines of sector specific laws of the financial sector during the state of crisis

The law of 12 May 2020 extending certain deadlines of sector specific laws of the financial sector during the state of crisis (the “Sector Specific Law”) introduces the extension of certain deadlines for various obligations relating to filings and provision of periodic reports for Luxembourg undertakings of the financial sector by a period of three months. As per the introductory foreword of the preparatory work of the Sector Specific Law, it is anticipated that numerous companies will encounter difficulties to meet their filing obligations due to the pandemic and the lock-down circumstances.

The Sector Specific Law was published on 12 May 2020 and entered into force on the same day.

The table below summarises the obligations that fall within the scope of the Sector Specific Law and the relevant extensions that will apply:

Type of entities Three months extension for the following obligations Practical example
Credit institutions (établissements de crédit)

The filing of annual accounts and related reports with the Recueil électronique des sociétés et associations (the RESA)

Annual accounts as at 31 December 2019 which should have been filed with the RESA by 31 July 2020, now should be filed by 31 October 2020
Insurance and reinsurance undertakings (entreprises d’assurance et de réassurance) The filing of annual accounts and related reports with the RESA Annual accounts as at 31 December 2019 which should have been filed with the RESA by 31 July 2020, now should be filed by 31 October 2020
Securitisation funds (fonds de titrisation) The obligation to publish annual and semi-annual reports  The annual report as at 31 December 2019 which should have been published by 30 April 2020, now should be published by 31 July 2020
Investment companies in risk capital (société d’investissement en capital à risque - SICAR) The obligation to make available the annual report as well as the independent auditor’s report to investors The annual report as at 31 December 2019 which should have been sent to investors by 30 June 2020, now should be sent by 30 September 2020
Variable capital savings-pension company (société d’épargne-pension à capital variable) and savings-pension association (association d’épargne-pension) The obligation to draw up consolidated accounts as well as related reports  Consolidated accounts as at 31 December 2019 which should have been drawn up by 30 June 2020, now should be drawn up by 30 September 2020
Specialised investment funds - SIF (fonds d’investissement spécialisé - FIS) The obligation to make available to investors the annual report  The annual report as at 31 December 2019 which should have been sent to investors by 30 June 2020, now should be sent by 30 September 2020
Undertakings for collective investment - UCI (organismes de placement collectif - OPC) The obligation to publish the annual and semi-annual report  The annual report as at 31 December 2019 which should have been published by 30 April 2020, now should be published by 31 July 2020
Reserved alternative investment funds - RAIF (fonds d’investissement alternatifs réservés - FIAR) The obligation to make available to investors the annual report  The annual report as at 31 December 2019 which should have been sent to investors by 30 June 2020, now should be sent by 30 September 2020

II. Extension of deadlines for the filing and publication of annual accounts, consolidated accounts and related report during the state of crisis

To the exception of special limited partnerships (SCSp), the management bodies of Luxembourg commercial companies must submit annual accounts for approval by the shareholders/partners within six months from the end of the financial year, and file such approved accounts within one month from their approval with the RCS. Most companies having financial years which follow the calendar year (i.e. 1 January to 31 December), will therefore have until end of July at the latest to proceed with such filings.

Given the current state of crisis and the global pandemic context, the Luxembourg legislator finds it appropriate to extend such deadlines so as to anticipate significant difficulties that commercial companies may face in the coming months.

The law voted on 12 May 2020 extending deadlines for the filing and publication of annual accounts, consolidated accounts and related report during the state of crisis (the ”Filing Deadline Extension Law”) therefore introduces an extension by a period of three months of the following filing obligations for all commercial companies (to the extent applicable):

  1. The filing and publication of the annual accounts and related reports;
  2. The filing and publication of consolidated accounts and related reports;
  3. The filing of the reports on payment to government entities.

Additionally, the Filing Deadline Extension Law provides that the annual general meeting of Luxembourg undertakings can be convened at a date falling within nine months from the end of its financial year, effectively extending the deadline for the approval of such annual accounts by the shareholders by three months. For undertakings having financial years which follow the calendar year (i.e. 1 January to 31 December), they will therefore have until end of September to have the annual accounts approved by the annual general meeting and until end of October to proceed with the filing of such accounts with the RCS.

Luxembourg law provides criminal sanctions applicable for the members of the management bodies which would fail to submit the annual accounts to the shareholders for approval within the legal deadline of six months and/or to file such accounts with the RCS within one month from approval. These deadlines are also expressly extended by three months by the Filing Deadline Extension Law.

The Filing Deadline Extension Law is expected to be published in the coming weeks in the Official Gazette and will come into force on the same day.

The Filing Deadline Extension Law is to be read in conjunction with the greater flexibility granted by the Luxembourg legislator for board members and shareholders/partners to attend corporate meetings remotely (read our alert here).

In addition to the above, the RCS has granted an administrative extension of up to four months for the filing of annual accounts, during which no late filing fee would be applied.

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