LUXEMBOURG Law and Practice Contributed by: Claire-Marie Darnand, Victorien Hémery, Johan Léonard, Benjamin Marthoz and Tom Storck, Stibbe
1. General 1.1 Main Sources of Law
• the Law of 7 August 2023 on individual hous - ing subsidies. Regarding real estate investments, the main leg - islation comprises: • the Law of 15 June 2004 on investment com - panies in risk capital (SICAR); • the Law of 5 August 2005 on financial collat - eral arrangements (the Collateral Law); • the Law of 13 February 2007 on specialised investment funds (SIF); • the Law of 12 July 2013 on alternative invest - ment fund managers (AIFM) implementing Directive 2011/61/EU on alternative invest - ment fund managers (AIFMD); • the Law of 17 December 2010 on undertak - ings for collective investment (UCI); • the Law of 23 July 2016 on reserved alterna - tive investment funds (RAIF); and • the Law of 19 December 2020 on the tempo - rary adaptation of certain procedural rules in civil and commercial matters. 1.2 Main Market Trends and Deals Until 2023, Luxembourg’s geographic and demographic characteristics, alongside its political stability and economic growth, fostered significant growth in the real estate market and attracted foreign workers. This situation has evolved in 2023/2024, reflecting broader eco - nomic challenges. With interest rates and infla - tion rising, combined with international geopoliti - cal tensions and rising construction costs, the real estate market was facing a period of adjust - ment during 2023 and Q1 of 2024. Demand for residential property remained high, but purchas - ing capacity has been hampered, leading to a shift towards rental markets. Statistics show that most nationals own their primary residence, often outside Luxembourg City. Luxembourg’s rental market is mostly focused on apartments
The Luxembourg Civil Code regulates the main aspects of real estate law in Luxembourg. It cov - ers ownership, mortgages and leases. The following legislation also applies: • the Law of 10 August 1915 on commercial companies, as amended; • the Law of 17 April 2018 on country planning, as amended; • the Law of 10 June 1999 on classified estab - lishments, operating permits, the commo - do-incommodo procedures regulating the security, environmental and technical aspects of construction, as amended; • the Regulation of 5 May 2012 on energy per - formance of residential and functional build - ings; • the Law of 19 July 2004 on communal plan - ning and urban development, as amended; • the Law of 22 October 2008 on the right of superficies and emphyteusis, as amended; • the Law of 18 July 2018 on the protection of nature and natural resources, as amended; • the Law of 15 December 2020 on the climate, as amended; • the Law of 21 June 1976 on noise control, as amended; • the Law of 7 August 2023 on individual hous - ing subsidies; • the Law of 7 August 2023 on affordable hous - ing and amending the Law of 25 February 1979 on housing assistance; • the amended Law of 19 July 2004 on munici - pal planning and urban development; • the amended Law of 19 July 2004 on urban planning and urban development; • the Law of 30 July 2021 on the Housing Pact 2.0; and
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