Attorney Jean Brucher of AMCHAM’s philanthropy working group remarked that interest in charity “is not a natural attitude in difficult times.” Yet giving has actually increased since the onset of the global economic crisis, perhaps as many people re-evaluate their priorities, Luxembourg venture capitalist Hugo Mahieu reckoned.
Compared to a few years ago, about 50 percent of foundations established in Luxembourg have international creators, primarily from Belgium, France, Germany and Switzerland, according to Tonika Hirdman of the Fondation de Luxembourg.
During a panel moderated by RTL’s Guy Weber, Hirdman explained that her organisation provides a mechanism for private individuals and companies to more quickly establish and run a straightforward charitable foundation. The legal and administrative requirements are all met by being part of the Fondation de Luxembourg.
Anne Contreras of Arendt & Medernach noted Luxembourg’s law on associations and foundations dates back to 1928. A bill tabled in 2009 to introduce a more flexible regime--for example, allowing foundations to own real estate properties directly--would be a great benefit for non-profits, she said. However, the bill has stalled in the chamber of deputies, with no progress made for many months.
The advancement in the Grand Duchy’s philanthropic scene has mainly come from modifications in fiscal rules, explained Jane Wilkinson of KPMG Luxembourg. The tax authorities raised the tax deduction limit for charitable contributions to one million euro or 20 percent of income, for instance.
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Hirdman said that she has met with several dozen private banks in Luxembourg over the past couple years and knows of at least ten that offer specialised services to their clients.
Jean-Jacques Rommes of the ABBL explained that as Luxembourg attracts more and more high end clients, private banks need to be able to offer advice and infrastructure in the field, as wealthy clients simply demand that their philanthropic activities be part of the service package.
For his part, Mahieu presented a case study on how Mangrove Capital Partners established the Mangrove Foundation, which supports NGOs focused on global overpopulation and environmental challenges. It was one of the first foundations established under the Foundation de Luxembourg’s umbrella. When it came time to create their foundation, he said: “We found everything we wanted in Luxembourg.”
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