The sole shareholder may, under certain conditions, substitute the manager of his sole proprietorship with limited liability (EURL). He must observe the minimum formalities described below. here are the necessary steps to proceed with a change of EURL manager:
- Appoint the new manager and draw up a report of the decisions of the sole partner,
- Publish a notice of change of manager in a newspaper of legal notice,
- Transmit a file to a competent authority.
Reasons justifying the replacement of the manager of an EURL
There may be various justifications for the termination of a director of an EURL :
- le terms of office provided for in the act of appointment of the manager of the EURL (statutes or separate act);
- the occurrence of a personal motive (death, incapacity, prohibition to manage, personal bankruptcy or other);
- la revocation by the sole shareholder (if it is decided without just cause, the manager can claim damages) or by the courts for a good reason;
- la transformation to or dissolution of the EURL.
Establishment of a new manager for an EURL
The sole shareholder must carry out the replacement of the manager who ceased his activities. It is he and he alone who must make the decision, without delegating it to another person (we are talking here about a unilateral decision of the sole shareholder of EURL). Once this decision has been made, certain formalities must be carried out according to the mode of appointment of the manager:
- appointment in a clause of EURL statutes a statutory amendment is necessary and additional publicity formalities must be complied with;
- appointment in a separate act: a decision report of the sole shareholder of EURL must be drawn up. An advertisement of the change of manager is also to be carried out.
In both cases, a specific paragraph must be inserted in the minutes:
Decision number [number] – Replacement of the manager
The sole shareholder decides to appoint as new Manager [Last name and first name of the new manager], moreover [Full address of the new manager], for a time [unlimited or limited, in this case, number of years]. At the same time, the sole shareholder acknowledges the resignation of [Last name and first name of the former manager] of his duties as manager notified on [Date of notification of resignation] ou of the death of [Last name and first name of the former manager] occurred on [Date of death] ou the non-renewal of the mandate of [Last name and first name of the former manager].
[Last name and first name of the new manager] will exercise its functions in accordance with the laws in force and the provisions of the articles of association. He also made it known in advance that he accepted these functions and that he was not subject to any measure or incapacity prohibiting him from exercising them.
Appointment of a new manager for an EURL
The sole shareholder must replace the manager who has left office. It is he and he alone who must make this decision, without delegating it to another person (we are talking here about a unilateral decision of the sole shareholder of EURL). Once this decision has been made, certain formalities must be put in place depending on the mode of appointment of the manager:
- appointment in a clause of EURL statutes a statutory amendment is necessary and additional publicity formalities must be complied with;
- appointment in a separate act: a decision report of the sole shareholder of EURL must be drawn up. An announcement of the change of manager is also required.
In both cases, a specific paragraph must be inserted in the minutes:
Decision number [number] – Replacement of the manager
The sole shareholder decides to appoint as new Manager [Last name and first name of the new manager], moreover [Full address of the new manager], for a time [unlimited or limited, in this case, number of years]. At the same time, the sole shareholder acknowledges the resignation of [Last name and first name of the former manager] of his duties as manager notified on [Date of notification of resignation] ou of the death of [Last name and first name of the former manager] occurred on [Date of death] ou the non-renewal of the mandate of [Last name and first name of the former manager].
[Last name and first name of the new manager] will exercise its functions in accordance with the laws in force and the provisions of the articles of association. He also made it known in advance that he accepted these functions and that he was not subject to any measure or incapacity prohibiting him from exercising them.
Process for changing the manager of an EURL
Publish an announcement in a newspaper of legal announcements (JAL)
When the sole shareholder transforms the structure of the corporate bodies of his EURL, he must communicate it to third parties within the month following his decision. For the appointment of the new manager to be binding on them, it must be published in a journal of legal notices covering the department of EURL head office.
The notice of legal announcement of change of manager must contain specific information which appears in the article opposite: model of legal announcement of change of manager of EURL).
Compile a file and submit it to the registry of the commercial court
Finally, to conclude the change of manager process and update the entries in the trade and companies register, a file must be assembled and sent to the business formalities center or at the registry of the commercial court. This deposit, which can be made online on the internet, a cost. The following documents must be attached to the application:
- a copy of the minutes of the sole shareholder's decisions certified true by the manager;
- a copy of the updated statutes, certified true to the original (if the manager had been named in the statutes);
- a copy of the certificate of publication in a journal of legal announcements;
- a sworn statement of non-conviction and parentage of the new manager;
- a copy of both sides of the new manager's proof of identity (identity card or passport);
- the completed, dated and signed M3 SARL-SELARL form;
- a check payable to the registry of the commercial court.
If the manager is the sole shareholder, he is the majority shareholder. It is then necessary to complete an application form for affiliation to an organization providing coverage for self-employed activities (RSI for example).
Changing the manager of an EURL is relatively simple. The procedure requires that the sole shareholder replace the former manager with the person of his choice. These are contract formalities (modification of statutes or drafting of minutes) and advertising.
To read also on the subject of the modifications of the statutes of EURL:
What is the procedure for changing the manager of an EURL?
Reply :
The procedure for changing the manager of an EURL consists of drafting an act of statutory modification, having it registered with the registry of the commercial court, and publishing a legal announcement.
What are the tax consequences of a change of EURL manager?
Reply :
The change of manager of an EURL does not entail any direct tax consequences. However, when the current manager sells his shares to another manager, a capital gain will be taxable if the sale is made at a price higher than the nominal value of the shares.
Does a change of EURL manager require the approval of a shareholder vote?
Reply :
In the case of an EURL, the change of manager is not subject to the approval of a vote by the partners. However, the outgoing manager and the new manager must sign the deed of statutory modification.
