In principle, with the exception of certain SAS companies, in which voting rights and shareholdings can be uncoupled, shareholdings give rise to proportionate voting rights. Whether a shareholder has a blocking minority will depend on the type of decision and the majority required to adopt that decision. If a simple majority is required, a minority shareholder would be unlikely to be able to block a decision. However, in cases where a qualified majority of two-thirds or three-quarters is required, a shareholder with a 34% shareholding or a 26% shareholding could prevent a decision being adopted.
What are regulated activities in French law?
There are certain areas such as the medical or legal professions which require specific qualifications and admission. However, there are many other regulated activities which require certain authorisations, qualifications or financial guarantees (travel agents, estate agents, transportation…)
How does one choose a company name in France?
Two sets of verifications should be undertaken: to check on existing identical or similar existing company names; and to examine existing identical or similar trade-marks.
Which company type should be chosen? In French law, there are several types of company (SA, SARL, SCA, SAS etc.) each with their own legal framework and rules. There is no one type of company which outclasses all the rest. The choice of the type of company should be adapted to the particular requirements in each case.
What happens if the company isn’t registered? If a company is not registered, it will not acquire legal personality and exist as a distinct legal person from its shareholders. Nevertheless, absent registration a company can exist de facto and create unlimited liability on the part of its members.
Is it lawful to have a company with one euro as share capital?
In a SAS or SARL, there is no legal minimum share capital. However, in practice the share capital can serve as a source of own equity to fund the company’s business development. The share capital also provides assurance to banks, suppliers and customers.
Do model articles of association exist in French law?
Unlike English law, French law only has one model set of articles of association approved by government regulation for a single shareholder limited liability company (EURL) in which the single shareholder has the role of director. Although there are a wide range of unofficial model articles of association accessible on the internet, it is strongly recommended that legal advice should be sought when drafting articles of association. Particular attention should be given to questions such as the corporate purpose, shareholdings, the date of the end of the financial year, the mechanisms for calling meetings and powers of the directors.
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