Luxembourg is a small, but strategically positioned country in Europe. Due to its perfect location, financial stability, and solid political framework, it’s the premier destination among private and institutional investors from all over the globe. Locals and expats enjoy a high quality of living, picturesque outdoors, and the accessibility of traveling to neighboring countries within a few hours of drive in all directions.  

If you are a foreign national looking to open a business bank account in Luxembourg, there are a few things that you must remember to gain approval from its world-class banking institutions. Let’s take a look at the pre-approval procedure to successfully open a bank account with the majority of banks based in Luxembourg. This guide will hopefully streamline the entire business formation process, allowing you to gain full control over the entire process. 

Why should you open a business bank account in Luxembourg?

Apart from being a requirement to open a company in Luxembourg, having a bank account in a Luxembourg banking institution offers a host of advantages. It is true that banking services in the Grand Duchy are more expensive than other countries. Apart from this, you get unbeatable service, protection and security of assets and investments. 

Unlike other European financial powerhouses, Luxembourg has abandoned too much of old-world bank secrecy laws and has opted to become a part of the Automatic Exchange Information for Tax Purposes (CRS). This means that  third parties are allowed access to personal data of bank account holders with the permission ordered by a Luxembourg local court. 

• Superior confidential of personal information 
• First-class banking services for foreign investors, including assistance to investments developing investment strategies, investment portfolio formation, and personal consulting. 
• All foreign nationals are allowed to open a personal and corporate bank account.
• Luxembourg implements a flexible pricing policy on its offered banking solutions. 

Requirements to Open a Bank Account in Luxembourg

All banks will require the following documents from foreign investors looking to open a corporate bank account in Luxembourg:

• A copy of a company’s Articles of Incorporation 
• Organizational chart displaying the names of all owners, shareholders, directors, and managers of a company. 
• A list of signatories of a company and copy of rules of engagement.

For natural persons who assume the role of director, manager, or shareholders, Luxembourg banks will also require the following:

• Identification card or passport
• Proof of residence with proof of billing in the past three months
• Curriculum vitae
• Information regarding an applicant’s marital status and profession
• List of the names of beneficial owners
• Annual accounts and/or consolidated accounts

Setting Up a Business Account Online 

Most banks in Luxembourg allow foreign investors to apply for a corporate bank account online. Investors based in other countries can process their application online, provided they can submit the required documentation. There are also Luxembourg banks that prefer application through mail or submit the documents in person once a corporate account is approved. 

• Determine the documents needed and fill out papers, as needed.
• Send all documents by mail or schedule an appointment to drop off all paperwork at a nearby local branch.
• Wait for the bank to send confirmation, card, PIN, and other necessary paperwork to arrive by mail. 
• Register to access Internet banking features and activate your account online. 

For international investors who do not have the time to create an account in person, consider opening an online bank account instead. Online registration for most banks in Luxembourg is simple and straightforward. Applicants need to register online, submit identification, complete the online verification process, and wait for approval notification from the bank. 

Before opening an online account with a bank in Luxembourg, make sure to read the fine print. Banks offer their services at various rates, so make sure to check fees and available features before starting an online application. 

Pre-Approval to Successfully Open a Corporate Bank Account in Luxembourg

Banks in Europe, including those in Luxembourg do not recommend opening a corporate bank account online. Additionally, Luxembourg banks are strict when it comes to applications to open bank accounts for companies located overseas. While the eligibility requirements differ from bank to bank, it is known to be more difficult for foreign investors to open a corporate bank account if they apply while staying overseas. 

Luxembourg banks follow due diligence and adhere to the highest standards when it comes to accepting applications from foreign nationals. Ideally, applications must be filled out properly, with no misprints or inconsistencies. 

There is still a chance that an application to open a bank account for a Luxembourg-registered business may be rejected.  Most common reasons for rejections are due to technical errors made while filling out the forms needed by the banks. 

What’s next if a bank rejected your application to open a Luxembourg corporate bank account?

Like all private companies, banks are business that are entitled to refuse to pursue a bank application, if applicants fail to meet their list of criteria. However, Luxembourg banks cannot discriminate against applications based on color, gender, and nationality. 

If you feel that you were unfairly refused to open a corporate bank account due to your race, gender, or sexuality, it is best to file a complaint with the bank’s management. In the event that you do not receive any response, foreign investors are recommended to raise their complaint before the Commission for the Supervision of the Financial Sector (CSSF) which is responsible for regulating the activities of banking institutions in Luxembourg. 

To open a bank account in Luxembourg in a smooth and speedy manner, you may choose to obtain our full suite of consulting services at Damalion. As a premier partner of foreign investors looking to establish their business presence in Luxembourg, a critical part of our services is to assist in the opening of a corporate bank account in the Grand Duchy. Our global service network consisting of a talented roster of skilled professionals that can expedite and efficiently process your corporate bank application with your preferred bank. You can rest assured that our expertise and experience will help you gain greater understanding of how the country’s banking system works and everything that you must know about the Luxembourg banking sector. Reach out to a Damalion expert today to learn more. 

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.