The SARL Gérant: Appointment, Powers and Dismissal Under French Law

The SARL gérant: who can hold the office, what it carries, and how it ends

Every SARL is run by one or more gérants — always natural persons, never companies. The office concentrates the firm's legal power: towards the outside world the gérant binds the company in all circumstances, even beyond the corporate purpose, while inside the company his powers stop where the statuts and the shareholders' reserved decisions say they stop. The mandate's other defining feature is its fragility and its protections in ending: a gérant can be dismissed at any time by shareholders holding more than half the shares, but dismissal without just cause costs the company damages, a brutal or humiliating dismissal costs more, and a gérant who himself holds half the capital can in practice be removed only by a court. This guide covers eligibility and disqualifications, appointment mechanics, single versus multiple gérants, the real scope of the gérant's powers — including the acts the law flatly forbids — and the complete exit map: expiry, resignation, dismissal with and without cause, and judicial revocation, with the extensive case law that prices each route.

Who can be gérant — and who cannot

The gérant must be a natural person; a company can hold every share of a SARL but can never manage it, so where all shareholders are legal entities they must appoint an outside individual (c. com. art. L 223-18). The gérant may be a shareholder or a third party — statuts requiring shareholder status are lawful but inflexible, and the classic scenario of a deceased gérant survived by an unprepared family shows why. Holding the office does not make the gérant a merchant, which is precisely why the SARL suits people whose situation bars personal trading. An emancipated minor can be gérant; a non-emancipated minor cannot, and the special regime allowing a 16-year-old to run an EURL does not extend to the ordinary SARL. Persons under curatelle need their curator's assistance and persons under tutelle the family council's or judge's authorisation. Two spouses can be co-gérants and sole shareholders of the same company. The law sets no age limit — statuts can borrow one, such as the 65 years applicable to SA general managers — and can add diploma, experience or non-cumul conditions.

Foreign gérants

Nationality is never a bar; residence is what matters. A foreign national of any country who manages the French SARL without residing in France has no prior formality at all. EU, EEA and Swiss nationals residing in France simply register with their town hall within 3 months of arrival and need no residence permit (CESEDA art. L 231-1; L 231-2). Non-EU nationals residing in France must hold a residence document authorising the activity: the one-year "entrepreneur/profession libérale" card (CESEDA art. L 421-5), then the four-year multi-year card — whose grant now involves civic training and, under the 2024 immigration law, a French-language requirement entering force by 1 January 2026 (loi 2024-42; CESEDA art. L 433-4) — or, after 5 years' uninterrupted residence, the ten-year resident card (CESEDA art. L 411-3). A "talent" multi-year card of up to 4 years can be issued on first admission in defined cases (CESEDA art. L 421-16). Managing while resident without a permit is punished by a year's imprisonment, a €3,750 fine and up to 3 years' exclusion from French territory (CESEDA art. L 821-1) — with treaty exemptions for Algerian, Andorran and Monegasque nationals.

Bans, disqualifications and incompatible professions

No one under a management ban can take the office. Criminal courts can attach the ban to convictions for up to 15 years, or definitively (c. pén. art. 131-27), and breaching it is itself an offence carrying 2 years' imprisonment and a €375,000 fine (c. pén. art. 434-40-1). Insolvency courts impose their own: personal bankruptcy (faillite personnelle) carries a blanket prohibition on managing any enterprise, and a free-standing management ban can replace it — both capped at 15 years, with claims prescribed 3 years from the opening judgment. Registrars screen every appointee against the national file of banned managers, alongside the sworn non-conviction declaration filed at every appointment. Separate incompatibilities close the office to entire professions: statutory auditors cannot manage a company they audited for 3 years after ceasing their functions; civil servants cannot join management organs, with narrow exceptions (CGFP art. L 123-1); avocats can manage only family-interest or law-practice companies, and notaires not at all; parliamentarians and ministers are excluded by the electoral code. Breach is mostly a disciplinary matter — the Cour de cassation holds that violating professional ethics rules does not by itself annul the irregular gérant's acts. Finally, where the company exercises a regulated profession, the gérant personally must hold the diploma or title — and in a SELARL, must be a practising shareholder.

Appointment: majorities, the "statutory gérant" myth, and co-gérance

Gérants are appointed in the statuts or by a later act of the shareholders — and where the first gérant is named outside the statuts, the act must follow almost immediately, since the constitution announcement must carry his name. The appointment decision follows ordinary-decision rules: more than half the shares on first consultation; failing that, and absent a contrary clause, a second consultation decided at the majority of votes cast. Since 21 July 2019, decisions taken in breach of these majorities can be annulled at any interested party's request. Two received ideas deserve burial. "Gérant statutaire" means nothing: being named in the statuts confers no extra security, and an ordinary decision suffices to replace any gérant and to strike his name from the statuts. And the appointment majority cannot be reinforced — unlike dismissal, where the statuts may require a stronger majority, the appointment texts allow no such clause. Publication makes the appointment and any cessation opposable to third parties.

Several gérants, one power each. Co-gérance serves real purposes — complementary skills, generational handover, continuity if one gérant dies — but it is not collegial government. Each gérant separately holds the full powers of a sole gérant and alone binds the company; joint-signature clauses and internal splits of responsibility are unenforceable against third parties, and one gérant's opposition to another's act affects a third party only if brought to his knowledge before the deal. The price of ignoring internal limits is internal: a co-gérant who signed a leasing contract alone, against a joint-action clause, bound the SARL towards the lessor — and had to indemnify the company for the resulting judgment. Internal power-sharing itself can live only in the statuts: an ordinary meeting's resolution splitting the gérants' powers is void, since limiting managerial powers towards the shareholders requires a statutory amendment at the extraordinary majority. The law knows neither a "deputy gérant" waiting in the wings — the registrars refuse to register one — nor cooptation by the surviving gérants: shareholders, and only shareholders, appoint. A statutory "conseil de gérance" binds internally at most, and a purely advisory management committee is fine.

Duration. The mandate's length is free; silence, or "unlimited", means appointment for the company's life subject to early termination. A fixed-term mandate ends automatically at its term, without notice — the gérant has no right to renewal and no indemnity for non-renewal, though humiliating circumstances surrounding it cost the company damages. Drafting matters even here: a clause ending the mandate "at the close of the meeting ruling on the accounts of the year in which it expires" did not end a mandate where no meeting had been held for 5 years — the gérant remained in office and could still convene one.

The gérant's powers: absolute outside, bounded inside

Towards third parties the gérant holds the fullest powers to act in the company's name in all circumstances. The rule is deliberately brutal: the SARL is bound even by acts outside its corporate purpose, an act contrary to the company's interest is not void for that reason — a mortgage granted over the company's only asset to secure a third party's debt, without consideration, stood — and statutory clauses limiting the gérant's powers are unenforceable against third parties whether or not they knew of them (Cass. com. 9 January 2019, no. 16-26697). The single escape is narrow: the company avoids an act exceeding the corporate purpose only by proving the third party knew, or could not have ignored, the excess — and publishing the statuts is never that proof (Cass. com. 24 June 2020, no. 18-11958). Signature formalities still count: a gérant who signs without stating any corporate capacity does not bind the company unless the counterparty proves he manifested the intent to act for it, and a contract signed for the company by someone without power is voidable — but only by the company, never by the counterparty (Cass. com. 28 March 2006, no. 04-19179).

Inside the company the picture reverses. The statuts define the gérant's powers towards the shareholders; in their silence, he may do all acts of management in the company's interest. Breaching internal limits leaves the act valid outside but arms the shareholders with just cause for dismissal and a damages claim. Above the statuts sit the powers the law reserves to the shareholders — first among them statutory amendments. The line runs through asset sales: selling a business (fonds de commerce) is not, in itself, reserved to the shareholders — unless the sale entails changing the corporate purpose, as where a SARL existing to publish a weekly sold that weekly, a sale the gérant alone could not make. The gérant does hold two statutory adaptation powers, each subject to ordinary-decision ratification: harmonising the statuts with mandatory new law, and transferring the seat anywhere in France.

Three specific regimes complete the map. Fund calls: the gérant alone decides when to call the unpaid balance of cash contributions — up to four-fifths — in one or several instalments within 5 years of registration; if he fails, any interested party can ask the court president to order the calls under penalty or appoint an agent to make them, and the defaulting shareholder owes interest at the legal rate automatically. Delegation: the gérant can never delegate the whole of his mandate, but special, temporary, precisely-defined delegations to identified role-holders are valid, survive his own departure, and — in criminal matters — shield him only where the delegate has the competence, authority and means required, never in small undifferentiated structures where the gérant keeps all powers, and never for a de facto manager invoking a delegation from the nominal one. Forbidden acts: on pain of nullity, gérants and individual shareholders — plus their spouses, ascendants, descendants and interposed persons — may not borrow from the company, run an overdraft on their current account, or have the company guarantee their personal commitments; corporate shareholders escape the ban, which is how intra-group advances remain possible under the regulated-agreements procedure.

How the mandate ends: death, resignation, dismissal

Death and incapacity end the functions immediately without dissolving the company. Since 21 July 2019, whenever the company finds itself without a gérant for any reason — or the sole gérant is placed under tutelle — any shareholder, or the statutory auditor, can directly convene the meeting to appoint a successor; on the sole gérant's death the convocation period drops from 15 days to 8. Delegations the deceased gérant granted survive him.

Resignation is a unilateral act available at any time without cause — subject to indemnifying the company for damage caused by an untimely departure. It takes effect when the company learns of it, needs no acceptance, and cannot be retracted; the resigner can only attack its validity by proving his will was not free and informed. A resignation extracted under co-shareholders' combined pressure to escape a decided dismissal is no resignation at all. Where a notice period exists, effect still dates from notification unless the contract expressly postpones it to the notice's end. And the old practice of undated resignation letters signed at appointment backfires: once proven, using the blank resignation equals a dismissal, with the damages that follow.

Dismissal by the shareholders

The gérant is dismissible at any time by shareholders holding more than half the shares, unless the statuts require a stronger majority; on a second consultation, absent a contrary clause, the relative majority of votes cast suffices — so a reinforced-majority clause protects only if the statuts also clearly exclude the second consultation. A unanimity requirement is void as de facto irremovability. The gérant-shareholder votes on his own dismissal — no statute can strip him of that right — with the arithmetic consequence that a gérant holding half or more of the shares cannot be dismissed by the meeting at all and can only be removed by the courts. Procedure matters: the dismissal should in principle appear on the agenda, though formulations like "examination of the company's management" suffice, and grave unforeseen incidents — or agenda items whose nature made dismissal a foreseeable outcome on which the gérant could present his observations — justify dismissal without express mention. A dismissal can never be retroactive.

Just cause prices the exit. Dismissal without just cause stands — the ex-gérant gets damages, never reinstatement. The case law's catalogue of just cause includes management faults of some gravity; moral harassment of staff and disregard of a pregnant employee's protections; maintaining a forbidden debit balance on his shareholder current account; criticism of the company voiced to outsiders that wrecked a fundraising; and discord — between shareholders or co-gérants — but only where it compromises the company's operation. On the other side of the line: a mere change of majority wanting its own man, secondary disagreements an amiable step could have resolved, losses not attributable to the gérant, forceful warnings against shareholder decisions he reasonably deemed harmful, and suing the company — a fundamental liberty. Courts set the indemnity from lost remuneration over the mandate's remaining course, the dismissal's circumstances and any forced exit from the company; a statutory lump-sum clause is valid unless so heavy it deters dismissal altogether, and remains judicially revisable as a penalty clause.

Brutal or vexatious dismissal is compensated even with just cause. Ordering the gérant at the meeting's end to hand over the keys and never return, or sending him a suspension letter barring him from the premises, is faulty in itself. The steady modern line: the gérant must be able to present his observations before the decision, and the dismissal must proceed loyally — though the grounds need not be disclosed before the meeting at which they are put to him, and even gross misconduct allowing immediate dismissal does not dispense with hearing him first. Where associés flout the convocation rules with intent to harm, they can be condemned personally alongside the company.

Judicial revocation completes the system: any shareholder — typically a minority facing an entrenched majority gérant — can ask the court to remove the gérant for legitimate cause, without needing to join every other shareholder to the action. Legitimate cause overlaps just cause but runs wider, reaching non-faulty situations. Removal has been ordered against a gérant whose conduct served only his own interests — withholding accounts, moving the seat without consultation, engineering a capital increase to vote alone — and refused where the alleged diversions concerned the brothers' private accounts more than the company's management. After any cessation, the company cannot rely on it against third parties until published; the departing gérant owes a management report for his period, loyalty to the company he ran — and can no longer pierce bank secrecy, even for his own period in office.

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