Are non-trading companies all firms to which legislation does not attribute another character by reason of their form, nature or objects.

General principles

Partners : The non-trading company shall be formed of at leastTwo partners, except for limited liability farms which may be formed of only one person. There is no maximum prescribed by law, unless otherwise specified in a particular text (For example, a professional medical non-trading company may be formed of a maximum of eight partners when all partners exercise in the same field and a maximum of ten partners when they exercise in different fields).

Partners may be natural persons or legal entities. They may be french or foreign citizens.
All partners are indefinitely liable for the debts of the company; i.e. they are liable in respect of their own personal assets.

The company's capital : Partners in a non-trading company must build a specific capital at the time of formation. However, as opposed to the formation of the limited liability companies and public limited companies, no legal or statutory stipulations prescribe a minimum capital.

Shares : The company’s capital shall be divided into equal shares. These shares may be sold only with the consent of all the partners.

Contributions : All partners must make a contribution to the company. These contributions may be made in the form of cash, kind or services. Only the contributions in cash and in kind make up the company’s capital.

Legal entity’s duration : The company’s term may not exceed 99 years.

Annual accounts : Publication of annual accounts is not required for non-trading companies.

Organisation

Manager : The non-trading company shall be managed by one or several persons, natural persons or legal entities. These persons shall be appointed in the memorandum and articles of association, in a distinct act or by a resolution of the partners representing (unless otherwise specified) more than half of the shares of the non-trading company.
A non-partner may also be appointed as a manager.
In dealings with third parties, the manager shall bind the non-trading company. He is the company’s legal representative. In the event of there being more than one manager, each shall represent separately the company in dealings with third parties.
If the manager is a legal entity, it must be represented by its legal representative.

Auditor : The appointment of an auditor is required only for :

• Non-trading companies working on real estate investment,
• Non-trading companies exercising an economic activity, if, at the end of the calendar year or the financial year,Two of these three conditions are met :
  • The number of employees is equal to or greater than 50.
  • The company’s turnover (without taxes) is equal to or greater than 3,100,000€.
  • The total of the balance sheet is equal to or greater than 1,550,000€.

For other non-trading companies, the appointment of auditors is not mandatory.

Décision-making process : Resolutions shall be passed by the partners convened in a meeting or may result from the consent of all the partners expressed in an instrument.
The memorandum and articles of association may also provide that they will result from a written consultation.
Resolutions which exceed the powers conferred upon managers shall be passed according to the provisions of the memorandum and articles of association or, failing such provisions, by the partners unanimously.

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