Legal regulation of foreign direct investment in the Grand Duchy of Luxembourg

Purpose: Study of the legal regulation of foreign direct investment in the Grand Duchy of Luxembourg in order to determine the current investment regime favorable to foreign persons. Methodology: Comparative legal, historical legal and formal legal methods were used. Results: Today the Grand Duchy of Luxembourg is one of the largest and most stable centers for managing international financial assets - there are about 4,000 registered funds with assets under management in the amount of more than 3.6 trillion euros. The geographical location of the Grand Duchy of Luxembourg, its political, social and reputation stability, developed infrastructure, favorable tax regime and investment climate, these and other factors are attractive for groups of companies that register their administrative centers and structural divisions (branches and representative offices) on its territory. Registration of a company and/or implementation of activities in Luxembourg gives them the opportunity to enter the common market of the European Union. The main idea of this article is focused on the analysis of recent changes in the national legislation of the Grand Duchy of Luxembourg, in particular in the corporate sphere, and includes the study of legislative acts that have also expired. The article concludes with an assessment that the current investment regime in Luxembourg may be different for different forms of investment. This diversity just attracts foreign investors, since, in particular, foreign direct investment, which by its nature is a means of strengthening the productive activity of the recipient state, is at the same time another tool for cross-border investment between groups of companies. In return, groups of companies with the goal of minimizing tax costs are interested in «financial engineering schemes» proposed by the legislation of the Grand Duchy of Luxembourg. Novelty/originality/value: The scientific value of this article is an it is attempt to unveil the legal regulation of foreign direct investment in Luxembourg in a complex, rather than the individual areas that are studied, namely: taxation, registration of a company in the offshore zone. The article briefly reviews the changes in the corporate sphere, as well as the current currency and tax laws, and some acts of the European Union and the Model BIT 2019.