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E-library Corporate Law SARL – Incorporation conditions (French corporate law)

SARL – Incorporation conditions (French corporate law)

19 Mar 2012

A SARL is a form of limited liability company.

Shareholders

Any person can become a shareholder of a French SARL, including non-French residents. Subject to certain exceptions, a SARL may validly exist with only one shareholder (in which case it is called a EURL ("entreprise unipersonnelle à responsabilité limitée"). A SARL may not comprise more than 100 shareholders.

Corporate purpose

Certain activities, such as (but not limited to) insurance, may not be carried out within the framework of a SARL. For other activities, such as (but not limited to) accounting services, the shareholders and/or directors of the company must meet certain criteria relating to professional qualifications.

Share capital

There is no minimum or maximum amount of share capital. The share capital of a SARL may be 1€. A SARL may also have a variable share capital. All issued share capital must be subscribed for on incorporation. Only 20% of the issued share capital must be paid on incorporation; the remaining amount of 80% must be paid within a period of 5 years thereafter. The cash contributions must be deposited with a notary or a bank. All shares give equal rights to vote, dividends and liquidation proceeds.

Directors

A SARL must have at least one director ("gérant"). Two directors ("co-gérants"), each of whom will have the right to represent the company, may also be appointed. A SARL may also be managed by a panel of directors ("collège de gérants").

Preparation and signature of bylaws

The constitutive bylaws of a SARL must be signed by all shareholders. Subsequent modifications to the bylaws may be adopted by a supermajority vote of the shareholders, in compliance with French law and as may be provided for in the bylaws.

SARL registration

The registration of a SARL is made by the commercial court having jurisdiction over the company's registered office. To register a SARL, the following documents must, inter alia, be provided:

  • signed copies of the company bylaws, which must be drafted in French,
  • proof of domiciliation,
  • certificate delivered by the bank having received the shareholders' cash contributions that such contributions have been deposited,
  • proof of absence of criminal record of the directors,
  • etc.
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