Luxembourg ranked as the second quickest jurisdiction in the 2024 global entity management rankings by Mercator, a platform focused on managing global legal entities. Known for its regulatory efficiency, advanced digital infrastructure and pro-business policies, Luxembourg stands out as a leading financial centre in Europe, noted the report.
The is based on corporate activities undertaken by clients to manage their entity portfolios, covering over 180 jurisdictions and 20 types of corporate secretarial tasks, representing nearly $3trn in market capital.
The grand duchy’s stable and transparent regulatory environment makes it an ideal hub for multinational corporations and investment funds. The country’s digital infrastructure streamlines corporate compliance through electronic filings, e-signatures and automated reporting, reducing administrative burdens. The Luxembourg Financial Sector Supervisory Commission (CSSF) further simplifies reporting, ensuring clear and efficient navigation of regulatory requirements, the report said.
Luxembourg's strategic EU position enables seamless operations across jurisdictions with harmonised regulations. Its efficient handling of compliance, including (UBO) laws, and cross-border regulatory cooperation further benefit multinational companies.
Mercator further noted that the pro-business legal framework offers flexible corporate structures for various activities, while a skilled workforce and competitive corporate services sector provide expert legal, tax and administrative support. Luxembourg’s stable, well-communicated policies give businesses the confidence to plan effectively.
Cost
The financial burden of corporate compliance varies significantly across jurisdictions, influenced by factors such as local regulatory complexity, digitalisation levels and the competitiveness of legal services. Malaysia, Sri Lanka and Bangladesh rank as the least expensive jurisdictions for entity management due to their streamlined regulatory frameworks, affordable legal services and lower labour costs. Companies operating in these jurisdictions benefit from reduced requirements for notarisation, translation and legalisation of documents, significantly lowering compliance costs. Additionally, the widespread acceptance of electronic filings and digital signatures further reduces administrative expenses.
In contrast, Qatar, South Korea and Oman are the most expensive jurisdictions for entity management. Qatar’s regulatory environment imposes high compliance costs due to stringent licensing requirements, the necessity of local sponsorships and frequent document legalisation requirements. South Korea’s corporate governance framework includes strict compliance standards and bilingual documentation requirements, increasing both time and cost. Oman’s regulatory system remains highly localised, requiring extensive paperwork, in-person submissions, and high legal fees, further driving up costs for businesses operating in the region.
Time
The time required to complete compliance-related tasks varies widely across different jurisdictions and is heavily influenced by bureaucratic procedures, digital integration and governance structures. The report finds that Gibraltar, Luxembourg and Bermuda are the fastest jurisdictions for completing entity management tasks. Luxembourg’s efficiency stems from its streamlined digital systems, effective regulatory coordination and well-structured corporate governance model, ensuring that companies can complete filings, ownership updates and compliance reporting in a timely manner.
Conversely, jurisdictions such as Bangladesh, Venezuela and Ghana continue to face significant inefficiencies due to bureaucratic delays, reliance on manual paper-based processes and administrative bottlenecks. Businesses operating in these regions must contend with inconsistent regulatory enforcement, frequent policy changes, and lengthy approval times, all of which contribute to compliance challenges.
Overall rankings
The report ranks Singapore as the top-performing jurisdiction for entity management in 2024, thanks to its world-class digital infrastructure, business-friendly regulatory environment and efficient compliance procedures. The United Kingdom follows closely behind, benefiting from an established and transparent regulatory framework, while Australia ranks third due to its advanced online compliance systems and streamlined legal processes.
On the other end of the spectrum, Indonesia ranks as the least favourable jurisdiction for entity management, with businesses struggling against cumbersome bureaucracy, complex approval procedures and high compliance costs. Brazil presents similar challenges due to its fragmented legal system, extensive documentation requirements, and frequent regulatory changes. The United Arab Emirates, despite being a business hub, ranks among the least favourable jurisdictions due to its highly decentralised regulatory landscape, complex licensing frameworks and the high costs associated with maintaining legal compliance.
Corporate governance trends
The Mercator report emphasised several key trends shaping corporate governance and entity management. Digitalisation continues to accelerate, with governments investing in online filing, automated compliance, and electronic reporting systems. In 2024, the UK introduced new corporate email registration requirements, Spain fully transitioned to electronic court notifications, and South Africa implemented real-time validation of beneficial ownership data to improve compliance.
The report also highlighted the growing importance of environmental, social and governance compliance, with stricter reporting regulations being adopted globally. Notably, 106 countries have now implemented ultimate beneficial ownership disclosure and Canada will introduce mandatory ESG reporting in 2025. Businesses must adapt to these evolving requirements to stay competitive in a more regulated environment.