What form of company should I choose?

The enterprise brings together human and material resources. Several forms of enterprise exist. The form of the enterprise is equivalent to its legal status.

Single shareholder companies

Companies can be set up by a single shareholder. This shareholder operates independently.

One form of business with a single shareholder is the Sole Proprietorship (SP). This is the simplified legal form. The tax system is based on income tax. The IE covers mainly commercial or craft activities, which do not require the creation of a company. However, the risk for the IE concerns the merger of professional and personal assets.

The Sole Proprietorship with Limited Liability (EIRL) is similar to the sole proprietorship. However, it has a considerable advantage in terms of protecting personal assets, which are separate from professional assets. It remains favourable for the liberal profession, traders, farmers and craftsmen.

The single-member limited liability company (EURL) is also formed by a single shareholder, but has a share capital fixed by its articles of association. When the sole shareholder is a natural person, the tax remains on the income, otherwise it is deducted from the company. The EURL can develop into a limited liability company. This form is particularly attractive to entrepreneurs with limited means.

The Société par Actions Simplifiée Unipersonnelle (SASU) is a simplified joint stock company established by a single shareholder. It is advantageous in terms of flexibility after its creation. This form is intended for the liberal professions, but cannot be used by the health and legal professions.

Multi-shareholder companies

Companies can have several shareholders. These are the limited liability company (SARL) and the simplified joint stock company (SAS).

The SARL is a commercial company set up by several natural or legal persons. It reduces the liability of shareholders to the amount of their contributions. Its operation is subject to the Commercial Code. The SARL is suitable for long-term projects and for craft, agricultural, industrial or commercial activities. Its ease of management is the major advantage for this form.

The SAS is a commercial company formed by several natural or legal persons. It is appreciated for its flexibility in terms of statutory clauses, under the corporate tax regime.

The public limited company for large companies

The public limited company (SA) is intended for large companies. It requires a minimum amount of capital set by the Commercial Code. It must have at least two partners. It requires a stable and viable mode of operation. At the time of launch, the company’s founders must provide half of the fixed capital. A public limited company may have either a chief executive officer and a board of directors or a management board and a supervisory board.

How to determine the nature of a company’s business?
What are the specificities of a Société par actions simplifiée (SAS)?