In France, the organization of a company is defined by its legal status and by the various articles and clauses of its social statutes. While market research and the business plan are essential for starting a business, the choice of legal status is crucial, and the chosen legal form depends on the means and objectives of the entrepreneur. For example, as a sole entrepreneur, you can open your share capital to new shareholders and transform your simplified joint-stock company (SASU) into its multi-person version, the SAS. For large projects with multiple shareholders, the public limited company (SA) is a solution that allows you to develop SMEs before becoming a large enterprise.
The legal status of a company, in a few words
It is the legal status (legal form) of a company that determines the legal framework within which it will operate and develop its economic activity.
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Legal status influences:
- the status of the director of a company, whether a natural or legal person: managing partner (or not), president, board of directors, management committee, etc.
- The social regime of the administrator (natural person): assimilated employee, Independent, etc., and,
- the tax system of the company (profit taxation): Corporate tax (IS) or Income tax (IR).
Creating an SA, how to avoid making a legal status mistake?
The choice of legal status is not negligible. This becomes clear as the business creation project progresses.
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It is therefore not only the type of activity that directs entrepreneurs towards one legal status rather than another, but also how to organize, manage, and govern, as well as how to understand the present and envision the future of the company: opening share capital, welcoming shareholders.
For a project that bases the company and its future on the importance of capital allocated to the development of a commercial (or industrial) activity, the status of a Public Limited Company is suitable.
In France, the public limited company represents the vast majority of the legal status of listed companies. It is thanks to the fact that the shares of a public limited company can be transferred, sold, or bought without the constraint that the shareholder assumes liability before the law other than that of the amount invested, that the entrepreneurial spirit has developed.
What are the legal characteristics of the SA?
- Shareholders must be at least 2 (since 11.09.2015), with no maximum imposed.
- To be listed, an SA must have at least 7 shareholders.
- The liability of shareholders is limited to the amount of their contributions.
- The SA is governed either by a board of directors and a managing director or by a board of directors associated with a supervisory board.
- The amount of share capital: minimum 37,000 euros.
- The share capital consists of contributions in kind and cash; contributions to industry are prohibited under an SA.
- Contributions in kind must be evaluated by a contributions commissioner and notified in the company’s statutes, along with the identity of the person providing them and the number of shares received in exchange.
- The share capital is divided into shares distributed among the shareholders.
- Insurance activities other than mutual insurance cannot claim to be exercised under the legal status of a Public Limited Company.
- The appointment of a full auditor, assisted by a deputy, is mandatory before the registration of the SA. The method of appointment is subject to a clause in the company’s statutes, and the contact details of the first appointed auditor are indicated there.
What are the steps to create a public limited company?
The steps to create an SA are similar to those for creating an SARL, SAS, SCI, SCN, etc.
First, the founding shareholders are responsible for drafting the statutes of the Public Limited Company, which must be the subject of a notarial deed if the contribution of an asset is subject to land publicity.
The statutes of the SA contain the following information:
- legal status,
- amount of share capital,
- company name, registered office address, activity (object) and duration of the company,
- identity of the signatories of the statutes,
- composition and powers of the directors,
- shares: number, nominal value, nature of related rights, form (registered, bearer),
- method of appointing auditors.
All specificities related to the proper functioning of the SA, for example, provisions regarding the allocation of income, conditions for the circulation of securities must also be drafted by legal clauses.
Then comes the bank deposit of the funds constituting the share capital of the company in formation, followed by the publication of the legal announcement of the company’s creation in an authorized legal announcements journal (accessible online).
Next, proceed to the actual creation of your SA by establishing the registration file and submitting it to the competent CFE (Centre de Formalités des Entreprises):
- M0 form dated and signed by the legal representative,
- statutes of the SA dated and signed,
- title of occupancy of the premises,
- notice of publication of the legal announcement of creation,
- certificate from the fund custodian, list of subscribers (number of share subscribers and amounts paid),
- if contributions in kind: report from the contributions commissioner dated and signed,
- if regulated activity: authorization to operate,
- authentication and proof of acceptance of the auditors’ mandate,
- notice of payment of registration fees.
As well as:
- documents specific to the management and administration of the SA, if it is directed by a board of directors or by a board of directors and a supervisory board,
- deeds of purchase, contribution, or leasing of business assets, all legally registered.
Finally, when you receive the Kbis extract of the SA, you will be able to unlock the cash contributions of the SA and then the balance within 5 years (maximum) from the date of registration. While most other legal forms only allow 20% of the capital to be deposited at the time of creation, corporate law imposes a minimum of 50% to be able to conclude an SA.
Online, the offer of many professional sites allows you to create an SA step by step. You can place your legal advertisement, design the drafting of your statutes using one of the pre-drafted templates, and submit your dematerialized file for the creation and registration of the SA online.
Tag: what is an SA