On Wednesday 7 July 2015, a round-table was organised in Neimënster by banking association ING Luxembourg and attended by Mr. Delosch, a notary from Diekirch, to discuss issues in cross-border inheritance.
The talks, to which several of the Bank's clients were also invited, were initiated in order to focus on the several inheritance laws that currently come into play when someone passes away, particularly when the deceased is not a national of their country of residency or when they retain property in several different countries. At the moment, there are two rules in force to determine which inheritance law is applicable, by which either a single law is applied to the entire estate or it becomes subject to several different laws.
In Germany, Italy, Poland and Spain, the law is dependent on the nationality of the deceased, whereas Denmark and Sweden take into account the law of the deceased's last place of residency. In Luxembourg, France and Belgium, however, several laws may be applicable - for movable property, it is the law of deceased's last domicile which comes into effect; and for real estate, the law of the country where such property is located becomes the important factor.
On 17 August 2015, European Regulation 650/2012 of 4 July 2012 on the law applicable to international succession is due to come into force with a view to harmonising the way in which the applicable law is determined. However, this only applies to civil law, this being the law which determines the precedence of heirs and the proportion of an inheritance to which they are entitled and does not change tax rules. Note that some countries such as the United Kingdom, Ireland and Denmark will not be implementing this Regulation, which means that just one law will be applied to all the assets involved in an inheritance. Sandrine Pompidou, Wealth Engineer at ING Private Banking and a speaker at the round-table, specified that "this will avoid any ‘conflict of laws’ that heirs sometimes encounter in cases of complex international inheritance".
The applicable law will subsequently be that of the country of the deceased’s habitual residence, even if the country in question is not a member state of the European Union (EU). It should also be noted that a person will be able to choose the law of the country (or one of the countries) of which they are a national as the law to be applied to their future estate. This must be specified in a will.
Lastly, this Regulation will introduce a European Certificate of Succession which will allow heirs to assert their rights in all EU member states, and will also allow procedures to be standardised. The initiative has taken six years to adopt, with procedures started in 2009.
Photo by ING Luxembourg (L-R: Mr. Delosch, notary ; Sandrine Pompidou, Wealth Engineer at ING Private Banking)
