Securitization refers to the situation when the originator transfers an asset pool, usually financial assets of any type and form, to a company that has been formed specifically for this purpose. Such a company is called a Securitization Company (SPV). Its role is to subsequently issue securities that are secured by the stated transferred assets as well as the payment streams resulted from the stated transfer.

A SPV in Luxembourg can be incorporated in the following legal structures:

  • as a Securitization Fund without legal personality (here, it is required by law that a special Management Company having legal personality be formed).
  • the Public Limited Company (PLC., Corp./SA), Partnership Limited by Shares or Limited Liability Company (LLC., Ltd./SARL);

The investors are free to choose the securitization vehicle of their choice in Luxembourg. According to the Securitization law, they can select between:

  • The securitization company
  • The securitization fund

Just like any other entities in Luxembourg, securitization companies in Luxembourg should be registered with the Trade Register, in accordance with their Articles of Association. As for securitization funds, they will be set up at the notary’s presence who will draft an agreement. The both aforementioned security vehicles are regulated by the Supervisory Commission of the Financial Sector in Luxembourg (CSSF).

Securitization vehicles are well known to offer high returns and are regarded as stable investments. For more insights on how to form and manage a SPV in Luxembourg, reach out to SIGTAX. Our team of accountants, lawyers, and consultants stay au courant with the latest business trends and regulations in Luxembourg. Thus, you can be confident that you will get relevant info which guides you to do everything the right way and in your favor.

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