Reform of the Law on Non-Profit Organisations
Non-profit organizations, previously governed by the law of April 21, 1928, have seen their legal framework amended as of September 23, 2023, the date on which the law of August 7, 2023 entered into force.
For existing non-profit organizations and foundations, the government introduced a 24-month transitional period to allow them to adapt their articles of association to the new regulations. This period ended on September 23, 2025, meaning the law now applies to all non-profit organizations and foundations.
A separate 12-month transitional period was granted to update their denomination (association/foundation).
What has changed?
The minimum number of founders has been reduced from 3 to 2.
The organization must demonstrate an activity in Luxembourg.
The good repute of directors must be reviewed every 5 years.
Remote meetings and electronic notices are now permitted.
An organization may be administratively dissolved without full liquidation.
It is now possible to maintain a register of members.
Ownership of real estate not strictly necessary for the organization’s purpose is now allowed.
New classification of non-profit organizations
Non-profit organizations are now divided into three categories: small, medium, and large, based on the following criterias :
| Small organization |
Medium organization |
Large organization |
|
| Full-time equivalent staff | Less than 3 | 3 to 15 | More than 15 |
| Total revenue | Below €50,000 | €50,001 to €1,000,000 | Above €1,000,000 |
| Total assets | Below €100,000 | €100,001 to €3,000,000 | Above €3,000,000 |
| Simplified accounting | Double-entry accounting | Double-entry accounting + approved statutory auditor |
Purpose of the reform
The aim of this reform is to modernize and simplify existing provisions, particularly administrative formalities.
It also seeks to enhance legal certainty, as well as improve transparency and consistency.
What are the risks if you have not updated your articles of association?
Misuse of the designation “foundation” may result in a fine ranging from €251 to €12,500.
In case of repeated breaches, a foundation may face administrative dissolution without judicial proceedings.
If a director abuses their powers to the detriment of the foundation, they may be subject to financial penalties and/or imprisonment.
The provisions in the articles of association of all existing non-profit organizations and foundations that are contrary to the provisions of this new law are automatically repealed and deemed unwritten.
Consult the official sources regarding the reform of non-profit organization law: