French Company Formation – (in French – Constitution d’une société) – There are numerous types of company structure which are provided for by French Law, however today the great majority of trading entities in France have taken the form either of a Société par Actions Simplifiée (S.A.S.) or a Société à Responsabilité Limitée (S.A.R.L.).Whilst this list may not be held to be exhaustive, the following points might be of particular comparative interest to practitioners used to the sometimes, but not always, different provisions of many Common Law systems.
The formation of companies in France is generally considerably more complicated and time consuming than in many Common Law jurisdictions.
Subject to certain exceptions, the S.A.S. and the SARL limit the liability of their shareholders to the amount of their shareholding.
There is no such thing (currently) as an off the shelf company at French Law and all types of commercial companies require that a minimum fixed amount of share capital be lodged and temporarily frozen prior to formation.
The SARL has no Directors, habitually a minimum of 2 shareholders, although it is possible to have just one shareholder, and is run by a Gérant or CEO. The S.A.S. can also have just one shareholder but can have more and is not required necessarily to have a Board of Directors. The S.A.S. is often considered to be the most flexible body in terms of corporate structure by US entities used to dealing with ‘S Corporations’ .
The Memorandum and Articles of Association (By(e)-laws) are far from standardised, although statute law provides for a number of heads which must obligatorily appear therein.
There are no longer any important constraints on either shareholders, or officers of a company, (be they individuals or corporate bodies), whose nationality is that of one of the member states of the European Union or the USA but detailed identity documentation must be provided.
The foregoing is not intended to be exhaustive and for specific information on forming a French Company, please click here