Starting a Business in Luxembourg
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Why Start a Business in Luxembourg?
It could be quite easy to miss The Grand Duchy of Luxembourg. Despite the lengthy moniker, it is one of the smaller countries in Europe. It is a sixth of the size of Yorkshire, has no coastline, has been invaded by all the countries that border it, and only gave up its neutral military stance after being annexed for the umpteenth time in World War II. Luxembourg's reputation in the late twentieth century has mostly focused on its role in the European Union, the EU organisations based there, and dull bureaucrats obsessed with the correct length of bananas.
Luxembourgers aren't what you'd call naturally outgoing folk, and they're very keen on good manners. So keen on good manners, and not fibbing, are they that bad manners are probably the cause of that one murder per 100,000 people a year. If you're prone to hyperbole in your sales shtick, and forgetting your Ps and Qs, you might want to brush up on etiquette before considering Luxembourg.
All that might make you think that Luxembourg is something of a grey doormat, but that couldn't be further from reality. Yes, as a founder member of the EU, Luxembourgers take European politics very seriously, but they also take money very seriously too. Luxembourg is one of the richest cities in the world, coming fifth out of seventy for average earnings, and is home to the European Investment Bank. Money is responsible for 28% of Luxembourg's economy, which compared to the rest of the world, is regarded as a stable one. On that alone, Luxembourg can look to be a very attractive place to consider starting a business. Add the fact that they rely on 60% of their labour force from overseas makes it a place where the locals won't be phased by incomers.
Tiny Luxembourg is also a big player in media technology. The former home to Radio Luxembourg boasts pan-European broadcaster RTL (they own Five and Freemantle Media), and owns the Astra satellites which broadcast to subscription services across Europe.
Luxembourg is a polite, clean and peaceful country. If you're comfortable being in the heart of the European Union and prefer not to do business in an "in your face" way then this financial centre could be the ideal place.
What is the population?
The population of Luxembourg is 539,000
What are the languages spoken?
The predominant languages spoken are Luxembourgish, German and French.
What is the climate?
The country has a mild and temperate climate with cool summers and mild winters, although the Northern winters can be severe. Luxembourg's terrain is mostly shallow valleys and gently rolling uplands with slightly mountainous land in the North.
Luxembourg has a highly developed economy with the highest GDP per capita in the world. It is a founding member of the European Union, NATO, the UN, and the city of Luxembourg is the seat of several institutions and agencies of the EU.
The country has a stable high-income economy with low inflation and low unemployment, which makes Luxembourg a favourable place for establishing a business.
It has recently diversified from the manufacture of steel to the financial sector. The industrial sector which includes chemicals, rubber, and other products is also increasing. Banking and financial services account for the majority of the country's economic output.
- Business hours - Business hours are usually 0800 - 1200 and 1400 - 1700 Monday to Friday.
- Working hours - Working hours are restricted to 8 hours per day and a total of 40 hours per week.
- Minimum wage - There are minimum wage rates according to age and level of skill.
- Holidays - Holiday is usually 25 days per year.
- Luxembourg's culture embraces hierarchical structure. It is therefore important to be aware of the position and authority of others. Likewise, you will receive the same respect.
- Luxembourgers are happy to conduct meetings in English
- Punctuality for meetings is taken very seriously
- Business people are expected to wear suits
- It is advisable to make prior appointments, and business cards are usually exchanged at meetings
Helpful contacts for starting a business
The following contact will provide you with useful information about setting up a business in Luxembourg:
British Embassy (Trade and Investment Section)
5, Boulevard Joseph ll, L-1840
Tel: 0352 22 9864 2216
The British Chamber of Commerce for Luxembourg
6 rue Antoine de Saint Exupéry
Tel: +352 46 54 66
Fax: +352 22 03 84
Office Hours: weekdays 09:00 - 13:00
Organisations that can assist with Starting a Business
PEO Worldwide is an international PEO offering employer of record, payroll, employee benefits management, HR and compliance services throughout the world.
Simplified Global Payroll Managing payroll in multiple countries is complicated with different systems, deadlines, and languages in each country, lack of reporting, and constantly changing laws and regulations. Trying to manage global payroll via fax and email with excel spreadsheets leads to data security issues, fines, and penalties for non-compliance. Blue Marble has solved global payroll challenges with cloud-based technology, customized aggregated monthly reporting, and a hybrid service model in 150+ countries around the world.