Registrar of the Commercial Court of Paris - Register of Commerce and Companies

The partnership limited by shares (“SCA”) shall be designated by its business name, in which may be incorporated the names of one or more partners. However, the names of the limited partners may not be incorporated.

General principles

Partners : The partnership limited by shares shall be formed ofTwo distinct categories of partners: managing partners and limited partners. There must be at least one managing partner and three limited partners. Law does not prescribe any maximum. The partners may be natural persons or legal entities. They may be French or foreign citizens.
Managing partners are deemed to be traders. They shall be indefinitely and jointly liable for the debts of the company.
Non-trading companies may not be managing partners, since they are not deemed to be traders. Likewise, a minor may not be a managing partner in a partnership limited by shares.
Limited partners have the capacity of shareholders and shall be liable for the debts of the company only up to the amount of their contributions.
Managing partners that are legal entities must declare their legal representative at the register of commerce and companies (“RCS”) only if they are managers as well.

The partnership's capital : The partnership’s capital is divided into shares and formed only of the limited partners’ shares. The shares of the managing partners who do not have the capacity of limited partners (i.e. they did not subscribe for shares) are not included in the formation of the company’s capital.

The registered capital must be at least 37,000€. The minimum is fixed at 225,000€, if the company’s shares are offered to the public. The company’s capital must be fully subscribed.

The company’s capital may be variable. When the partnership has variable capital, only the minimum capital (the sum below which the capital may not be reduced) must be declared at the register of commerce and companies (“RCS”). This amount may not be less than :

- A tenth of the company’s capital as indicated in the memorandum and articles of association (maximal capital)
- · 37,000€

Shares : Shares representing contributions in cash must be paid in respect of at least fifty percent paid of their face value. The balance may be paid in one or more payments within a deadline which may not exceed five years with effect from registration of the company in the register of commerce and companies (“RCS ”). On the other hand, shares representing the contributions in kind must be paid in full at the time of their issue.

Contributions : Only limited partners must make contributions to the company. These contributions may be made in cash or in kind.
Only managing partners may make contributions in the form of services. Those contributions are not included in the formation of the company’s capital.
The appointment of an auditor is mandatory in case of contributions in kind and the valuation of these contributions must be indicated in the memorandum and articles of association.

The legal entity's duration : The partnership’s term may not exceed 99 years. It runs from the partnership’s registration at the register of commerce and companies (“RCS”) and may be extended on decision of the partners. Each extension may not exceed 99 years.

Annual accounts : The partnership limited by shares (“SCA”) must file annual accounts and, if applicable, consolidated financial statements, with the registry (“RCS”) a month after their approval in a general meeting. This general meeting shall be held within a period of six months after the end of the financial year.
However, a request for time extension for holding of the general meeting ruling on the annual accounts may be made by sending a petition to the president of the Commercial Court.

In case of disapproval of the annual accounts, the minutes or an excerpt of the minutes of non-approval must be deposited at the registry (“RCS”) inTwo copies certified true by the legal representative.

Manager : The partnership limited by shares shall managed by one or more managers. The first managers must be appointed in the memorandum and articles of association. They may be natural persons or legal entities. When a legal entity is appointed as a manager, the appointment act must indicate the identity of its legal representative who must be declared to the register of commerce and companies (“RCS”).
The limited partners may not be managers in a partnership limited by shares.
The manager(s) are selected among managing partners or third parties.
In dealings with third parties, the manager shall binds the partnership. He is the partnership’s legal representative. In the event of there being more than one manager, each shall represent separately the company in dealings with third parties.

Auditor : The appointment ofTwo auditors, one as incumbent and the other as deputy, is mandatory. The first auditors shall be appointed in the memorandum and articles of association.

Supervisory board : The supervisory board shall be formed of at least three members. These members must be limited partners. They may be natural persons or legal entities. In this latter case, the legal entity appointed as a member of the supervisory board shall not appoint a permanent representative, unless otherwise specified in the memorandum and articles of association.
Likewise, the supervisory board is not required to appoint a chairman and a deputy chairman as in the public limited companies with an executive board and a supervisory board, unless otherwise specified in the memorandum and articles of association.
A managing partner may not be a member of the supervisory board. The shareholders who also are managing partners may not participate to the appointment of the members of this board.
All members of the supervisory board must be declared at the register of commerce and companies (“RCS”).
The first members of the supervisory board must be appointed in the memorandum and articles of association.

Decision-making process : Unless otherwise specified, the amendment of the memorandum and articles of association requires the agreement of all managing partners.