UNDERSTANDING THE SCSP (SLP) A FLEXIBLE VEHICLE
1. Introduction What Is an SCSp?
The SCSp is a limited partnership without legal personality, meaning it is contractually driven rather than governed by rigid corporate law rules.
It is established by a Limited Partnership Agreement (LPA), which defines the internal rules and relationships between partners.
Key Roles:
· General Partner (GP): Manages and legally represents the SCSp and bears unlimited liability.
· Limited Partners (LPs): Contribute capital but do not manage the entity, their liability is limited to their investment.
Main Advantages of the SCSp
1. Contractual Flexibility
The SCSp’s governance, voting rights, profit-sharing, and transfer of interests are entirely determined by the partnership agreement.
There is no mandatory structure imposed by law, allowing tailor-made arrangements.
2. Tax Transparency
Properly structured, the SCSp is fully tax transparent for Luxembourg corporate tax purposes.
It pays no corporate income tax, no municipal business tax, and no net wealth tax profits are taxed only at the partner level.
3. Confidentiality
Limited Partners' names are not disclosed in public filings.
Only the GP’s identity must appear on the Luxembourg Trade and Companies Register (RCS).
4. No Minimum Capital Requirement
There is no legally required minimum capital. Contributions are freely determined by the partners.
5. Light Regulatory Burden
Unless managed by an AIFM (Alternative Investment Fund Manager) and offered to investors, the SCSp remains unregulated.
It can be created and operated without licensing.
Key Uses of an SCSp
· The SCSp is an attractive structure for:
· Private Equity Investments
· Real Estate Holdings and Development Projects
· Venture Capital Funds
· Family Office Structures
· Debt and Infrastructure Financing Vehicles
· Crypto and Alternative Asset Funds
It is also frequently used as an investment platform by institutional investors, private wealth managers, and entrepreneurs.
IMPORTANT CONSIDERATIONS
General Partner (GP) Liability:
The GP is jointly and severally liable for the SCSp’s obligations. Usually, the GP is a separate limited liability company (Sàrl) created to mitigate risk.
Substance Requirements:
Although the SCSp itself is light, Luxembourg increasingly expects substance for investment structures (e.g., management activities in Luxembourg).
AIFMD Impact:
If the SCSp qualifies as an Alternative Investment Fund (AIF) and is offered to multiple investors, it may need to appoint an authorised or registered AIFM.
CONCLUSION
The SCSp offers an exceptionally flexible, efficient, and investor-friendly structure in Luxembourg — making it a preferred vehicle for a wide range of private investments.
Its tax transparency, confidentiality, and contractual freedom make it particularly attractive for private equity, real estate, venture capital, and wealth management strategies.
However, designing and managing an SCSp properly requires experienced legal, tax, and operational guidance.
Our team can assist you in setting up an SCSp tailored to your investment goals, ensuring compliance and strategic efficiency.
