Luxembourg parliament is considering two new bills which were introduced respectively on 26 and 27 March 2020 to provide headroom to operating businesses and funds in respect of their accounting obligations.
Any extensions granted under these new bills 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. BILL 7540 – EXTENSION OF CERTAIN DEADLINES OF SECTOR SPECIFIC LAWS OF THE FINANCIAL SECTOR DURING THE STATE OF CRISIS
The bill n° 7540 (the “7540 Bill”) suggests 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 7540 Bill, it is anticipated that numerous companies will encounter difficulties to meet their filing obligations due to the pandemic and the lock-down circumstances.
The 7540 Bill also gives power to the CSSF (commission de surveillance du secteur financier) and to the CAA (commissariat aux assurances) to extend by three months the obligations to file or publish periodic reports that fall within their respective jurisdiction and are not covered in the bill.
The table below summarises the obligations that fall within the scope of the 7540 Bill and the relevant extensions that will apply:
| Type of entities |
Three months extension for the following obligations |
Practical example |
| Credit institutions (établissements de crédit) |
(i) the filing of annual accounts and related reports with the Recueil électronique des sociétés et associations (the RESA); and
(ii) the filing of corporate governance declarations (when not included in the governance report) with the RESA |
Annual accounts as at 31 December 2019 which should have been filed with the RESA by 31 July 2020, now needs to be filed by 31 October 2020 |
| Insurance and reinsurance undertakings (entreprises d’assurance et de réassurance) |
(i) the filing of annual accounts and related reports with the RESA;
(ii) the filing of the non-financial declaration with the RESA (or making it available to the public on the company’s website); and
(iii) the corporate governance declaration (when not included in the governance report) with the RESA |
Annual accounts as at 31 December 2019 which should have been filed with the RESA by 31 July 2020, now needs to 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 needs to 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 needs to 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 by 30 June 2020, now needs to be drawn 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 needs to 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 needs to 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 needs to be sent by 30 September 2020 |
II. BILL 7541 – 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 bill n° 7541 (the “7541 Bill”) therefore suggests the extension by a period of three months of the following filing obligations for all commercial companies (to the extent applicable):
- the filing the annual accounts and related reports;
- the filing of consolidated accounts and related reports;
- the filing of the non-financial declaration as a separate report (or the publication thereof on the company’s website);
- the filing of the corporate governance declaration as a separate report (or the publication thereof on the company’s website); and
- the filing of the reports on payment to government entities.
The 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 are also suspended for a period of three months.
In other words, in its current form, the 7541 Bill does not extend the deadline for approval of the accounts by the shareholders, but only the deadline to file such accounts with the RCS, however any criminal fines for both the failure to approve and the failing to file within the legal deadlines are suspended.
The bill 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.
