Advantages of SARL, The French Limited Company

Advantages of SARL, The French Limited Company

In today’s world, globalization and economic growth have made it easy for people of any nationality to create businesses in any part of the world. In France, there are various legal structures available, such as SARLs, SASs, and SAs. The most beneficial legal form and relatively easy to incorporate for foreigners is SARL, which is equivalent to LLC. This article will discuss further this particular formation with its benefits.

“Société à Responsabilité Limitée” (SARL) is translated to “Limited Liability Society” in English. SARL is one of the most common legal forms, that has its own legal personality. In order to set up a SARL, at least two shareholders are needed, one can be of any nationality and may own 100% of shares that are very beneficial for foreigners who wish to establish a business in France.

Advantages

The French Limited Company, SARL, offers various benefits as follows:

  1. Low capital

There is no minimum shared capital in order to complete the incorporation process in France. The stated capital of SARL may be as low as 1 Euro, and the shareholders are able to incorporate a French liability company. Their contributions can be made in cash, tangible or non-tangible such as intellectual properties.

Nevertheless, even though the minimum amount is 1 Euro, in practice if you are seriously willing to set up a limited company in France, you should consider the right and appropriate capital amount.

  1. Shareholders

According to article 35-1 of the code de commerce, the liability company should have at least two or more shareholders. There is no specific requirement of the maximum number of shareholders, however, some sources mention 100 is the limit. Good thing is, it is not required for the shareholders to be French citizens. Any foreigners are able to set up a company in France as a shareholder or director, so as to own 100% of the shares.

  1. Limited Liability

Shareholders of the company are liable to the extent of their contribution. This means partners’ liability for the debts of the company is limited to the amount of each of their respective capital contributions.

  1. EU member

France is one of the founding architects of a regional organization of the European Union which belongs to one of The Leaders of Six Countries, the six original founding member states of the European Union. This enables any business to enter the European market and allows more opportunities with the other EU member countries.

Interested in setting up a company in France? Check our articles “What to know before creating a company in France”. For any queries please contact Aizen Consulting contact@aizenconsulting.com

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