Société Anonyme (SA): Everything You Need to Know
Verified by – Directorate of Legal and Administrative Information (Prime Minister)
The Société Anonyme (SA) is a legal structure suited for large-scale businesses aiming to go public.
Definition of Société Anonyme (SA)
A Société Anonyme (SA) is a commercial company that can operate in any industry except for certain regulated sectors (such as tobacco retailing and regulated liberal professions like doctors, lawyers, or accountants).
The minimum number of shareholders required is 2 (or 7 if the company is publicly traded). Shareholders can be individuals or legal entities (companies, associations). There is no legal limit to the maximum number of shareholders.
The Société Anonyme is particularly suitable for large businesses requiring significant capital beyond the means of a limited group of investors. It can raise capital publicly to finance major projects.
In return for their investment, shareholders receive shares that can be traded on the stock market, offering the potential for profits (dividends).
Capital Structure of a Société Anonyme (SA)
The share capital of a Société Anonyme (SA) must be at least €37,000, divided into shares. Contributions can be in cash or in-kind (assets such as equipment, real estate, patents, etc.). However, industry contributions (such as expertise or specific labor) are not allowed.
Shareholders’ financial liability is limited to their contributions, protecting their personal assets from company creditors.
At least 50% of the cash contributions must be paid at the company’s formation, with the remaining balance to be paid within five years of registration.
In-kind contributions must be assessed by an auditor, with their report submitted to the commercial court registry and made available to shareholders.
Governance of a Société Anonyme (SA)
Management Structures
The governance of a Société Anonyme (SA) can take two forms:
- Board of Directors
- Executive Board and Supervisory Board
Board of Directors
Most commonly, an SA is managed by a Board of Directors that defines business strategies and ensures their implementation. The Board conducts necessary controls and evaluations.
The Board consists of 3 to 18 members, who may be individuals or legal entities. Employee-elected directors and those representing employee-shareholders are not counted within this limit.
A Chairperson, elected from among board members, presides over shareholder meetings and has a casting vote.
Board members serve a maximum term of 6 years.
A CEO (Director General) is appointed by the Board or its Chairperson. The CEO is responsible for day-to-day management and represents the company in dealings with third parties. Up to five Deputy CEOs can be appointed.
Role of the General Meeting
The General Meeting plays a crucial role in decision-making, including:
- Appointment and dismissal of board members
- Appointment of auditors
- Approval of financial statements
- Distribution of profits
- Amendment of company bylaws
- Dissolution of the company
Ordinary resolutions are passed in an Annual General Meeting (AGM), while extraordinary resolutions (such as bylaw modifications) require an Extraordinary General Meeting (EGM).
Taxation:
Corporate Taxation
The Société Anonyme (SA) is subject to corporate tax (IS). It must file an annual corporate tax return (Form 2065) within three months of the fiscal year-end. If the fiscal year closes on December 31, the deadline is the second business day following May 1.
The corporate tax rate is 25% on taxable profits. A reduced 15% rate applies to SMEs with revenue under €10 million, whose capital is fully paid up and at least 75% owned by individuals. This lower rate applies to profits up to €42,500; profits exceeding this amount are taxed at 25%.
Taxation of Executives and Shareholders
- Executives (CEO, Chairperson, Board Members): Salaries are taxed under personal income tax (IR) and are deductible from company profits.
- Board Members: Remuneration (previously known as attendance fees) is taxed as investment income, subject to a 30% flat tax (12.8% income tax + 17.2% social charges).
- Shareholders: Dividends are taxed under capital income, subject to a 30% flat tax. Shareholders can opt for income tax rates instead.
Social Security System for SA Executives
Executives (Chairperson, CEO) are considered salaried employees for social security purposes, giving them access to employee health and pension benefits. However, they are not eligible for unemployment insurance unless they subscribe to private coverage.
Board members only benefit from social security if they are remunerated.
Transfer of Shares in a Société Anonyme (SA)
Free Transfer of Shares
In principle, Société Anonyme shares are freely transferable without approval requirements. However, the bylaws can introduce restrictions, such as:
- Approval Clause: Requires shareholders’ consent before selling shares to external parties.
- Pre-emption Clause: Grants existing shareholders priority to buy shares before they are sold to outsiders.
In contrast, restrictions that completely prevent share transfers for a fixed period are prohibited.
Registration Fees
The transfer of shares incurs a registration fee of 0.1% of the sale price. If the company primarily owns real estate assets, this tax increases to 5%.
The minimum fee is €25.
Comparison: Société Anonyme (SA) vs. SAS vs. SARL
Feature | Société Anonyme (SA) | SAS | SARL |
Minimum Shareholders | 2 (7 if publicly traded) | 1 | 1-100 |
Leadership | Chairperson + Board / Executive Board | President | Manager |
Capital Requirement | €37,000 | No minimum | No minimum |
Capital Contribution | 50% at formation | 50% at formation | 20% at formation |
Corporate Tax (IS) | Yes, option for income tax | Yes, option for income tax | Yes, option for income tax |
Executive Taxation | Salaries taxed under income tax | Salaries taxed under income tax | Salaries taxed under income tax |
Executive Social Security | Employee status | Employee status | Self-employed or employee |
Share Type | Shares | Shares | Units |
Public Market Listing | Yes | No | No |
Share Transfers | Free (approval possible) | Free (approval possible) | Subject to shareholder approval |
Registration Fee | 0.1% | 0.1% | 3% after €23,000 deduction |
