Aurélie Budzin-Dang

As announced by the Luxembourg Government in its action plan to enhance Luxembourg competitiveness and attractivity, Bill of Law no 8590 was submitted on 24 July 2025 to the Luxembourg Parliament (hereafter the "Bill") to clarify certain elements of the existing carried interest regime, expand its scope and innovate on certain aspects.

After being stalled at the draft stage for over three years, it results from the ECOFIN report 9960/25 of 18 June 2025 (the "Report") that the proposal for a Council Directive laying down rules to prevent the misuse of shell entities for tax purposes and amending Directive 2011/16/EU (so-called "Unshell" or "ATAD 3" proposal) has been officially dropped.

The European Commission (the "Commission") has closed three in-depth State aid investigations into transfer pricing tax rulings granted by Luxembourg to Fiat and Amazon, and by the Netherlands to Starbucks. Following judgments by the EU Courts, the Commission found that the tax rulings did not grant the companies selective advantages.