Luxembourg
LUXEMBOURG AT A GLANCE | DOING BUSINESS IN LUXEMBOURG | DTA BETWEEN HONG KONG AND LUXEMBOURG | LUXEMBOURG IN HONG KONG | USEFUL ADDRESSES IN LUXEMBOURG
LUXEMBOURG AT A GLANCE
Luxembourg, one of the smallest countries in Europe, has a population of fewer than half a million people in an area of around 2600 square kilometers. Dubbed the “Green Heart of Europe”, Luxembourg is famous for its beauty of nature. Ultimately leading to a Luxembourgian lifestyle that is laid-back, healthy and engaging in all facets of life.
Luxembourg City offers a vibrant, cosmopolitan atmosphere that is minutes away from blankets of forests and magnificent views. Luxembourg embraces in a culture of art and history that is supported through the building of infrastructure like the Philharmonic hall, Sports and Cultural Center in Kirchberg and The Neumünster Abbey.
Luxembourg has an extensive and efficient transportation system. The abundance of transportation options makes it easy for people to get around via multiple types of transport including cars, taxi, bus and bikes.
Luxembourg’s three official languages are French, German and Luxembourgish. In addition, English is taught as a compulsory language in the education system. The education standards in Luxembourg are one of the highest in Europe through the establishment of multiple international schools and the University of Luxembourg.
As small as it is, Luxembourg is a gateway to the European market and an ideal location to work and live in.
DOING BUSINESS IN LUXEMBOURG
Situated at the heart of Europe, bordering Belgium, France and Germany, Luxembourg is a geographical haven for businessmen who strive to do business in Europe. With political and social stability, a highly skilled and multilingual workforce, high-tech infrastructure, alluring tax system and a desirable legal environment, Luxembourg is a business paradise filled with opportunities for investors.
Luxembourg is the worlds last existing Grand Duchy. With a sophisticated framework, the multi-party system offers political independence and stability that translates into favorable government policies. To stimulate growth and employment, the government is implementing a pro-active economic development policy. Originally a steel-based economy, this policy has allowed the restructuring of Luxembourg’s economy into an internationally recognized financial center and prime business location. Another source of economic growth arises from foreign trade and investment. Luxembourg follows an active policy to diversify its trade on an international level, ultimately encouraging a global interest for business partnerships between Luxembourg and the rest of the world.
Over the past 40 years, Luxembourg has successfully managed to become recognized as one of the world’s leading financial centers. Home to around 215 financial service providers with a highly experience, multinational and multilingual workforce, Luxembourg has gained the reputation of being a sophisticated financial center with the support of government policies and an active player in the development of the finance industry.
Besides being a financial center, Luxembourg has embraced the IT revolution and become an active participant in the development of IT in Europe. The country’s culture of trust and security reflected in the legal framework makes Luxembourg an ideal global hub for the distribution of digital audiovisual content. Recently, Luxembourg has become home to many of the top IT firms, just to name a few, Amazon, Skype and iTunes have elected Luxembourg as a European headquarters.
Luxembourg is also well-known for being a key location for first and second tier suppliers in the automotive industry. At the crossroads between France, Germany and Belgium, Luxembourg is in an ideal location for component suppliers with a multi-customer base. The geographical location of Luxembourg proves to be a significant asset in time-management for major European car manufacturers.
With a growing concern for preserving our environment, The Luxembourg government has taken an active stance by prioritizing “eco-innovation”. With a legal framework in place, many companies have profited from environmental-friendly activities and product.
The level of global production has led to a need for more time- and cost-efficient methods of transport. Located at the heart of Europe, Luxembourg has continuously improved its position as a global hub for logistics in Europe for contract, air-freight based and added-value logistics activities.
The Grand Duchy of Luxembourg benefits from a very high degree of labour stability. The country has an effective mediation system that manages all issues with labour relations in the event of a dispute or structural economic problems. Despite its changes in the government coalition, Luxembourg ensures the continuity of government programs and plays an active role in the construction of the EU. Finally, Luxembourg has a very low crime rate, becoming one of the safest cities to live in the world.
Luxembourg's fiscal climate is among the most favorable in Europe with the lowest VAT rate (15%), moderate corporate income tax and an attractive personal income tax. Companies who decide to invest in Luxembourg tend to enjoy numerous measures of tax exemptions, for example to finance their investments.
(Sources: Board of Economic Development and Luxembourg for Finance)
DOUBLE TAXATION AGREEMENT BETWEEN HONG KONG AND LUXEMBOURG
Hong Kong and Luxembourg signed an agreement on 2 November 2007 to avoid double taxation and prevent fiscal evasion with respect to taxes on income and capital. The two governments were respectively represented by Prof. K C Chan, Secretary for Financial Services and the Treasury, and Jeannot Krecké, Luxembourg Minister of Economy and Foreign Trade.
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The DTA agreement proclaims a closer economic partnership between the two entities as it provides added investment incentives for Luxembourg and Hong Kong companies to do business in each other’s jurisdiction.
Profits earned by Luxembourg nationals residing in Hong Kong will no longer be subject to taxes both in Hong Kong and Luxembourg as will also Luxembourg companies’ branches established in Hong Kong, which are for the moment fully taxed in both places. Under the DTA agreement, Luxembourg will provide full exemption for such income. |
Hong Kong residents or companies receiving dividends from Luxembourg not attributable to a permanent establishment there will see the Luxembourg withholding taxes down from the current 20% to 10%. If the recipient is a company holding 10% or more of the share capital of the paying company (or having invested 1.2 Million Euros or more), the withholding tax will be lifted.
Profits from international shipping transport earned by Hong Kong residents that arise in Luxembourg will also enjoy tax exemption under the agreement.
The DTA agreement came into force on 1 January 2008 for Luxembourg and 1 April 2008 for Hong Kong.
The office of the Honorary Consul of Luxembourg in Hong Kong delivers passports to Luxembourg nationals and provides translations (French/English, English/French) for official documents. The Honorary Consul also endorses the "carnet de famille" of citizens from the Grand Duchy of Luxembourg.
All visas to Luxembourg are handled by the Consulate General of Belgium.
Other administrative services and advice to Luxembourg nationals are provided by the Honorary Consul of Luxembourg. Trade enquiries received at the consulate are passed on to the Chamber of Commerce of the Grand Duchy of Luxembourg in Luxembourg.
Contact details:
The Office of the Honorary Consul of Luxembourg
Mr. Leo Kung Lin-Cheng, Honorary Consul of Luxembourg
Suite A, 18/F, 60 Gloucester Road
Wanchai - Hong Kong
Tel: +852 2877 1018
Fax: +852 2869 6623
E-mail: conlux@netvigator.com
USEFUL ADDRESSES IN LUXEMBOURG
Ministry of the Economy and Foreign trade
Board of Economic Development
19-21, boulevard Royal
L-2914 LUXEMBOURG
Phone: (+352) 247-84129
Fax: (+352) 26-20-27-68
info@bed.public.lu
http://www.bed.public.lu
Luxembourg Chambre de Commerce
L-2981 Luxembourg
Phone : 42 39 39 – 1
Fax : 43 83 26
chamcom@cc.lu
http://www.cc.lu
Luxembourg for Finance
59, boulevard Royal
BP 904
L-2019 Luxembourg
Tél. : + 352 27 20 21 1
Fax : + 352 27 20 21 399
lff@lff.lu
http://en.luxembourgforfinance.lu
Luxembourg Government
33, boulevard Roosevelt
L-2450 Luxembourg
Europe
Tél: +352 247 82181
Fax: +352 47 02 85
info@sip.etat.lu
http://www.gouvernement.lu/
Luxembourg City Tourist Office
B.P. 181, L – 2011 Luxembourg
30, place Guillaume II, L – 1648 Luxembourg
Tel.: (352) 22 28 09
Fax: (352) 46 70 70
touristinfo@lcto.lu
http://www.lcto.lu/
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