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15.6 Luxembourg Partnership Forms (SNC, SCS)

SNC (Société en Nom Collectif)​

Characteristics:

  • General partnership
  • All partners have unlimited liability
  • Partners manage business
  • Less common

SCS (Société en Commandite Simple)​

Characteristics:

  • Limited partnership
  • General partners: unlimited liability, manage business
  • Limited partners: limited liability, no management
  • More common than SNC

Accounting Differences​

Both Use:

  • Partner capital accounts
  • Profit/loss allocation
  • Similar accounting principles

Differences:

  • Liability structure
  • Management rights
  • Some legal requirements

Luxembourg Compliance Note​

Partnership forms in Luxembourg:

  • SNC: General partnership
  • SCS: Limited partnership
  • Must comply with partnership law
  • Must use proper PCN accounts
  • Must file with RCS

Think It Through​

What are the differences between SNC and SCS? When might each be appropriate?