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Comparative table of companies’ legal structures under French law

Comparative table of the legal structures of the main companies

The tables hereafter shown in this document compare the main legal structures mainly used in France, available to entrepreneurs.

We have included in this table several commercial-type enterprises as well as two cases of non-commercial structures.

The cases for commercial-type companies are:

  • E.I. (Entreprise Individuelle) – Individual Enterprise;
  • E.U.R.L. (Entreprise Unipersonnelle à Responsabilité Limitée) – Enterprise with limited liability;
  • S.A.R.L (Société A Responsabilité Limitée) – Company with limited liability;
  • S.A. (Société Anonyme) – Private Company;
  • S.A.S. & S.A.S.U (Société par Actions Simplifiées – Société par Actions Simplifiées Unipersonnelle) – Companies with stock actions simplified;
  • S.N.C. (Société en Nom Collectif) – Collectif ownership company;
  • S.C.O.P. (Société Coopérative et Participative) – Cooperative and Participative Company.

The two non-commercial structures are:

  • Associations, which are useful to philanthropic entrepreneurs or commercial types, with non-competitive activities;
  • The S.C.I. (Société Civile Immobilière) which are useful for the organization of real estate assets.

The following criteria will be further developed:

  • Number of partners;
  • Management style;
  • Responsibility of partners;
  • Responsibility of leaders;
  • Capital amount and contribution release;
  • Contributions in kind;
  • Net profit taxation;
  • Executives’ compensation tax regime;
  • Social scheme for managers;
  • Social scheme for partners.

COMMERCIAL COMPANIES

 
Individual Entrepreneur
E.U.R.L
S.A.R.L
S.A.
S.A.S and S.A.S.U
S.N.C
S.C.O.P
NUMBER OF PARTNERS
 The individual entrepreneur only One single partner (natural or legal person)2 partners minimum
100 maximum
(physical or legal persons)
-2 partners minimum in unlisted companies 
-7 partners minimum in listed companies
 -Partners may be physical or legal persons       
Minimum 1 partner-No maximum
(physical or legal persons)
Minimum 2 partners no maximum legal
(physical or legal persons)
2 partners minimum – no maximum (Scop SAS)
2 partners minimum – maximum 100 (Scop SARL)       At least 7 partners (Scop SA)
MANAGEMENT STYLE
 The individual entrepreneur only A manager (mandatory natural person) who can be either the sole shareholder or a third party.One or more manager(s), who must be natural person(s) (either one of the partners or a third party)Either a board of directors (3 to 18 members) who must be shareholders. The chairman is appointed by the board of directors from among its members.Or a management board and a supervisory boardA single president, natural person or legal person. The partners freely determine in the articles of association the rules of organization of the companyOne or more manager(s), natural or legal person. It can be either one of the partners or a third partyA manager elected by the salaried partners for 4 years (6 years for the Scop SA)
PARTNER’S RESPONSABILITY
Liability of the individual entrepreneur limited to goods used for the professional activity, in terms of professional debts. the main residence is legally unseizable by professional creditors. Automatically benefits from the separation of personal and professional assets.The partner’s liability is limited to the amount of their contributions, unless they have committed management errors or granted guarantees on a personal basisThe partners’ liability is limited to the amount of their contributions unless they have committed management errors or granted guarantees on a personal basisThe partners’ liability is limited to the amount of their contributionsThe partners’ liability is limited to the amount of their contributionsPartners are jointly and severally liable on all of their personal propertiesThe partners’ liability is limited to the amount of their contributions.
LEADER’S RESPONSABILITY
Civil and criminal liability of the entrepreneurCivil and criminal liability of the managerCivil and criminal liability of the manager (s)Civil and criminal liability of the manager (s)Civil and criminal liability of the manager (s)Civil and criminal liability of the manager (s)Civil and criminal liability of the manager (s)
CAPITAL AMOUNT AND  CONTRIBUTION RELEASE
Share capital does not existAmount freely fixed by the partner, according to the needs of the company Compulsory cash release of 20% upon incorporation and the balance within 5 yearsAmount freely fixed by the partner, according to the needs of the company
Compulsory cash release of 20% upon incorporation and the balance within 5 years.
€37.000 minimum
Compulsory release of 50% of the cash contributions to the constitution and the balance within 5 years
Amount freely fixed by the partner, according to the needs of the company
Compulsory release of 50% of the cash contributions to the constitution and the balance within 5 years
Amount freely fixed by the partner, according to the needs of the company
Full release of contributions to the constitution is not compulsory. The balance will be paid at the request of the management
€ 18.500 for Scop SA
€30 for Scop Sarl or SAS
CONTRIBUTIONS IN KIND
N/APossible: Must be indicated in the articles of association, appointment of an auditor in charge of the assessment but possibility of dispensing with it in certain casesPossible: Must be indicated in the articles of association, appointment of an auditor in charge of the assessment but possibility of dispensing with it in certain casesPossible: Must be indicated in the articles of association, appointment of an auditor in charge of the assessmentPossible: Must be indicated in the articles of association, appointment of an auditor in charge of the assessment but possibility of dispensing with it in certain casesPossible: Must be indicated in the articles of association, appointment of an auditor in charge of the assessment is not compulsorySee SARL, SAS or SA depending on the legal form chosen
NET PROFIT TAXATION
The entrepreneur is taxed directly under income tax, either on a flat-rate basis (micro-enterprise regime) or in real terms (real tax system). The sole proprietor subject to a real tax regime may, however, opt for corporation tax.The company is not taxed, the sole shareholder is taxed directly for income tax as in a sole proprietorship.
The EURL can opt for corporate tax and thus the manager will pay tax on the income on his remuneration and the company will be taxed on the net profit to the corporation tax
The net profits are subject to corporation tax and the remuneration of managers to income tax
The company may opt for income tax in the case of family SARL or, under certain conditions, for SARL less than 5 years old
The net profits are subject to corporation tax and the remuneration of managers to income tax
The company may opt for income tax under certain conditions, for SA less than 5 years old
The net profits are subject to corporation tax and the remuneration of managers to income tax
The company may opt for income tax under certain conditions, for SAS less than 5 years old
The company is not taxable, each partner is taxed on his share of profits for income tax (in the category of industrial and commercial profits)
The company can however opt for corporate tax
Profits are subject to corporation tax
Exemption from corporation tax for the fraction of profits distributed to employees in respect of the participation and for that set aside as part of the investment provision
EXECUTIVES COMPENSATION TAX REGIME
Income tax in the category corresponding to the activity of the company or, in the event of the option for corporation tax, in that of wages and salariesIncome tax in the category of industrial and commercial profits or non-commercial profits (EURL subject to income tax), or in that of wages and salaries (EURL subject to corporation tax).
The single associate manager of EURL in the IR regime can choose the tax regime of the micro-enterprise
Salaries and wages tax regime, except if the company opt for income taxSalaries and wages for the chairman of the board of directors (for conventional SA)or for the Chairman of the Management Directory Board for other companies
Unless the company option for income tax
Salaries and wages tax regime for the president, except if the company opt for income tax.Income tax in the category of industrial and commercial profitsTax regime of salaries and wages
SOCIAL SCHEME FOR MANAGERS
Self-employed workers schemeSelf-employed workers scheme when the manager is the sole shareholder
Assimilated-employee when the manager is not a partner
SARL submited to corporation tax:
Minority or egalitarian manager: assimilated-employee
Majority manager: self-employed
Option to IR: See SNC regime
SA in classic form: The chairman is considered an employee The other members of the board of directors do not come under any social security scheme because they are not remunerated for this functionThe president is assimilated-employeeSelf-employed workers schemeManagers are assimilated to employees in particular with regard to unemployment insurance
SOCIAL REGIME FOR PARTNERS
N/ASelf-employed
worker scheme
The partner can be a self-employed worker if he is in the majority, or an employee if he is equal or minority.Employees’ scheme
(if they have an employment contract)
Employees’ scheme
(if they have an employment contract)
Self-employed workers
scheme
Employees scheme
(if they have an employment contract)

NON-COMMERCIAL COMPANIES

 
ASSOCIATIONS
SCI
NUMBER OF PARTNERS
2 members minimum
no maximum
2 members minimum
no maximum
MANAGEMENT STYLE
Freely chosen mode of management. The association is often run by a board of directors, which usually elects an office (president, treasurer and secretary)One or more managers, partners or not, natural or legal persons
PARTNER’S RESPONSABILITY
Non-executive members are not responsiblePartners are liable on all of their personal properties
LEADER’S RESPONSABILITY
Civil and criminal liability of the manager (s). Liability reduced under certain conditions when the manager performs his duties on a voluntary basis.Civil and criminal liability of the manager (s)
CAPITAL AMOUNT AND  CONTRIBUTION RELEASE
There is no social capital
Members can make contributions with the possibility of recovering them when the association is dissolved.
No minimum
CONTRIBUTIONS IN KIND
Each contribution must be recorded in the articles of association, as well as the right of recovery so that the contributor can take advantage of itPossible: Must be indicated in the articles of association, appointment of an auditor in charge of the assessment is not compulsory
NET PROFIT TAXATION
Associations which make profits, with for-profit purposes, are subject to corporation tax at the standard rate
Non-profit associations benefit from a reduced corporate tax rate on their only income from assets
Non-profit associations whose revenues ancillary sales do not exceed € 60,000 per year, are tax exempt
The company is not taxable
Each partner is taxed on his share of profits for income tax (in the category of property incomes)
The company can however opt for corporate tax
EXECUTIVES COMPENSATION TAX REGIME
Tax regime of salaries and wages if remuneration is paid.The manager can only be an employee if he is not a partner. In the event that the associate manager receives remuneration, this is not deductible from the profit of the SCI.
SOCIAL SCHEME FOR MANAGERS
Managers are assimilated-employees under certain conditionsNon-partner managers are assimilated-employee
SOCIAL REGIME FOR PARTNERS
No working contract
possible for
members
N/A

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