The prime minister is the head of government and serves five-year terms. The leader of the majority coalition formed after parliamentary elections is appointed prime minister by the hereditary monarch, the grand duke, whose powers are largely ceremonial.

Incumbent prime minister Xavier Bettel of the Democratic Party (DP) was appointed to form a new government in October 2018 following that month’s parliamentary election. The new government was based on the existing coalition of the DP, the Luxembourg Socialist Workers’ Party (LSAP), and the Greens (DG). The election was considered credible.

The unicameral legislature, the Chamber of Deputies, consists of 60 members elected to five-year terms by proportional representation. In the October 2018 election, the DP led the ruling coalition parties with 12 seats, followed by the LSAP with 10 and the Green Party with 9. The main opposition party, the CSV, won 21 seats. The populist right-wing Alternative Democratic Reform Party (ADR) won 4 seats, while the Pirate Party and the Left each took 2. The contest was generally seen as free and fair

Luxembourgers participated in the May 2019 European Parliament (EP) election; the DP won 21.4 percent of the vote, while the CSV won 21.1 percent, the Greens won 18.9 percent, and the LSAP won 12.2 percent.

The electoral laws and framework are considered fair, and they are generally implemented impartially. Voting is compulsory. In 2017, the government passed a law allowing postal ballots for all citizens.

A multiparty Constitutional Revision Committee completed its draft of a new constitution in 2018. Amendments to the constitution can take effect only after being approved by two-thirds of parliament in two separate votes, or by two-thirds of parliament in one vote plus a national referendum. The parliament passed the first of several planned reform packages with the required majority in October 2021, but despite criticism from some opposition parties, the ruling coalition and the CSV decided not to put the amendment to a national referendum. The reform process remained ongoing at year’s end.

The political system is open to the establishment of new parties, which do not face undue obstacles in their formation or activities. Three parties have traditionally dominated politics: the CSV, historically aligned with the Catholic Church; the LSAP, a center-left party; and the DP, which favors free-market economic policies. Four smaller parties—the Greens, the ADR, the Left, and the Pirate Party—have also won representation. While constituting a party is relatively easy, the structure and size of electoral constituencies, as well as the 10 percent electoral threshold, favor larger parties.

The country has a record of peaceful transfers of power between rival parties. Both the DP and the Greens were in the opposition before forming the governing coalition with the LSAP in 2013. The CSV, which had played a leading role in most governments since 1945, was forced into opposition in 2013 for the first time since 1979, and it remained out of government following the 2018 election.

Citizens are generally able to make political choices without undue interference from any democratically unaccountable groups. However, close links between the country’s financial center and its law-making elites is regularly a topic of concern for the opposition and outside observers.

Women engage actively in politics, and the government has taken measures to encourage greater participation. A 2016 law mandates that at least 40 percent of each party’s electoral candidates be women; parties risk losing a portion of their public financing if they do not meet the quota. However, only 20 women hold elected seats in the Chamber of Deputies, which accounts for 33.3 percent of Parliament. Citizens who belong to ethnic minorities and LGBT+ people enjoy full political rights and are free to participate in practice. In 2013, Prime Minister Bettel became the nation’s first openly gay person to hold his position.

About 49 percent of the population consists of foreign nationals, most of whom are citizens of other European Union (EU) member states, with Portugal accounting for the largest single contingent. The law allows naturalization and dual nationality, and children automatically gain citizenship when a parent is naturalized. Foreign residents are entitled to vote in municipal elections and EU foreigners can participate in EU elections. In September 2021, the government abolished a five-year residency requirement for voting in municipal elections; however, foreign residents are excluded from participating in national elections. Notably, politicians of foreign origin remain rare in Luxembourg, despite the background of nearly half the population.

The prime minister, cabinet, and parliament determine and implement the government’s policies without improper interference from unelected entities.

Corruption is not widespread in Luxembourg, and allegations of corruption are generally investigated and prosecuted. However, the Council of Europe’s Group of States against Corruption (GRECO) has previously criticized the government for failing to develop a comprehensive strategy to prevent graft. In addition, rules on accepting gifts, lobbying, and mitigating conflicts of interest after government officials leave office are lacking. The European Commission repeated this criticism in July 2021, citing cases of former ministers joining the private sector without any real safeguards.

In 2020, a scandal regarding mismanagement at the royal court triggered a reform process aimed at making the missions of the royal family more transparent.

While the legislative process and government operations are largely transparent, there is no comprehensive freedom of information law in place, and the media and civil society groups often have difficulty obtaining official information in practice. Cabinet members are obligated to disclose any shares in companies that they own, but there are no penalties for those who do not cooperate.

Historically, regulations governing interactions between lobbyists and high-level government officials have been considered weak. New transparency regulations, requiring those representing interest groups to register their details before contacting members of Parliament, were passed by the parliament in December 2021 after several months of debate.

In February 2021, the EU introduced a new directive on public country-by-country reporting (CBCR), which will require firms throughout the bloc, including in Luxembourg, to disclose revenues and tax payments in an effort to promote tax transparency.

Freedom of the press is guaranteed by the constitution and generally respected in practice. Luxembourg’s media market is regulated by the Independent Luxembourg Broadcasting Authority (ALIA). A single conglomerate, RTL Télé Lëtzebuerg (RTL), dominates broadcast radio and television, though numerous print, online, and foreign news sources are also available and present a broad range of views. Internet access is not restricted.

The written press has historically tended to align with traditional parties. In 2020, the Belgian conglomerate Mediahuis purchased the Saint-Paul group, the owner of the country’s largest daily newspaper, the Luxemburger Wort. Mediahuis claimed that the acquisition would result in no job losses, but 70 Luxemburger Wort employees were let go that December, a move criticized by analysts as potentially weakening the country’s media environment.

Freedom of religion is largely respected in practice. The state has historically paid the salaries of clergy from a variety of Christian groups, but a 2016 law ended the practice for all clergy hired after that point. Under the law, the government continued to provide some funding to six major recognized religious communities, including the Muslim community, based on their size. Religious instruction in secondary and primary schools was phased out in 2016–17. In 2018, the parliament adopted legislation that banned face coverings in schools, medical facilities, public buildings, public transport, and retirement homes. The law was widely understood to be aimed at Muslims, though the wearing of such garments is extremely rare in the country.

Academic freedom is generally respected in practice.

Freedom of expression is largely respected, and individuals can voice their political views without fear of retribution.

Freedom of assembly is guaranteed by the constitution and generally respected in practice.

Nongovernmental organizations (NGOs) are largely free to operate without any undue restrictions.

Workers are free to organize in trade unions and bargain collectively. The right to strike is guaranteed once conciliation procedures are formally exhausted. Employers are subject to penalties for antiunion discrimination.

Judicial independence is generally upheld. Judges are appointed by the grand duke and cannot be removed arbitrarily.

Parliament conducted ongoing discussions in 2021 regarding a constitutional amendment that strengthens the independence of judiciary by establishing a Council of Justice, competent to nominate candidates for all judicial posts prior to their formal appointment by the executive (and formally by the grand duke). Composed of nine members, the council would also develop ethical standards and act as a watchdog for judges. The reform is expected to be adopted in 2022.

Due process is largely upheld in civil and criminal matters. Defendants have the right to a fair and public trial, and this right is generally respected. Police typically observe safeguards against arbitrary arrest and detention.

There are no major threats to civilians’ physical security. Prison conditions and protections against the illegitimate use of force are adequate, and violent crime is rare.

In September 2021, a man was attacked by a dog owned by a private security firm hired by the Luxembourg City government. The incident sparked a heated debate over the legality of the city’s contract with the security firm, which had been accused of overreaching its authority earlier in the year; in November, local officials announced that the contract would not be extended past that month. An investigation into the incident was ongoing as of December.

Discrimination on the basis of race, religion, disability, age, sex, gender identity, or sexual orientation is prohibited by law. The rights of LGBT+ people are generally respected.

Women have benefited from reductions in the gender pay gap and an increase in their labor participation rate in recent years, though women still hold significantly fewer senior positions than men.

The Luxembourg government has instituted an onerous language requirement for those seeking public sector jobs and employment. Individuals in the public sector must speak German, French, and Luxembourgish fluently. However, very few official documents are in Luxembourgish, and exceptions to this requirement are made for high-level positions due to a lack of qualified candidates. The requirement funnels citizens into public sector positions, which are lucrative and secure, pushing immigrant workers into the unstable private sector in which there are other barriers to entry. Moreover, discrimination in the education system limits somewhat the economic potential of nonnationals.

Individuals generally enjoy freedom of movement, and there are no significant restrictions on their ability to change their place of residence, employment, or institution of higher education.

The rights to own property and operate private businesses are legally protected and respected in practice.

Individual freedoms on issues such as marriage and divorce are generally guaranteed. Same-sex marriage has been legal since 2014, and same-sex couples have full adoption rights. Abortions are legal on request within the first trimester of pregnancy; later abortions require two doctors to determine that the pregnancy threatens the woman’s life or health. The authorities generally uphold laws and practices meant to address rape and domestic violence.

The country’s residents largely enjoy equality of opportunity, and the government enforces legal protections against exploitative working conditions. Occasional cases of forced labor in the construction and food-service industries have been reported, especially among migrant workers.