snc characteristics

The characteristics of the general partnership (SNC)

The Namely Created Companies are relatively rare in France because of the risks incurred by the partners. They are mainly used out of obligation, for example to operate a tobacco shop with several people. Discover the main ones here legal properties of SNCs.

Activities achievable in SNC

All lawful and realizable activities can be exercised in the form of a general partnership. It is sometimes mandatory to create an SNC, as to open a tobacconist for example. Certain activities are however prohibited, in particular those of insurance.

The precision of the corporate purpose is essential when creating an SNC, because it defines the powers of the manager. This is very important because of the indefinite and joint liability of the partners on the social debts.

The equity of the SNC

The statutes of an SNC require own funds, the amount of which is determined by the members, without imposing a minimum threshold.

A SNC also has the option of having variable capital.

Contributions within an SNC

In an SNC, the partners have the possibility of providing monetary contributions, contributions in kind and contributions in industry.

Contributions in industry have no impact on the share capital.

In the case of contributions in kind, it is not necessary to appoint a contribution auditor. This is due to the unlimited and joint liability of the partners.

Partners of SA with Limited Liability

At least two associates are required to open a limited liability company and there is no upper bound.

To become a partner in a SA with limited liability, you must be considered a trader, which requires you to be an adult or an emancipated minor with the authorization of a judge.

In exchange for their contributions to the SA with limited liability, the partners receive shares and a series of rights:

  • monetary rights (dividends, liquidation indemnities, etc.),
  • political rights, including the right to vote at assemblies,
  • rights of access to information, both continuous and prior to each meeting,
  • and other rights, for example the right to ask questions of the manager or to go to court.

Limited liability SA partners are required to meet important requirements:

  • they are bound to answer jointly and severally for social debts,
  • they must contribute to the losses according to their shares, unless the statutes of the company provide otherwise,
  • they undertake to release the money and/or goods they contributed when setting up the SA with limited liability,
  • and they are sometimes required to comply with a non-competition obligation.

General Partnership Management

La management of the general partnership is carried out by the manager or by a group of managers if there are several. In the absence of any appointment in the articles of association, all the partners of the SNC are managers.

The manager of the SNC represents the company vis-à-vis third parties and is empowered to act in all circumstances on behalf of the company.

In relation to the partners, he is authorized to carry out all acts for the benefit of the company, although his powers may be limited by the articles of association. However, these restrictions do not apply to third parties.

Meetings of the partners of a general partnership

Decisions relating to the community of partners are taken at a general meeting, either in its normal version or in its special version depending on their nature.

It is possible to provide consultations by post to take decisions, with the exception of the following three cases:

  • for the annual acceptance of the company's accounts,
  • for the approval of a change in share capital as part of a safeguard or recovery plan,
  • and when a partner requests the holding of a general meeting.

The statutes of the SNC then establish the functioning of the meetings: convening procedures, deadlines, holding of meetings, etc.

For decision-making, the majority rules are defined in the statutes. However, the following decisions require the unanimous agreement of the partners:

  • transformation into SAS,
  • merger-absorption by an SAS,
  • continuation of the activity despite the prohibition or inability to exercise suffered by a partner,
  • dismissal of a manager when all the partners are managers,
  • continuation of the company despite the dismissal of the manager.

Other particularities of the SNC

The main legal particularities of the SNC include:

  • the SNC must have a corporate name;
  • the life of the company is regulated in the articles of association, with a maximum of 99 years;
  • the closing date of the accounting year is also set in the articles of association, each accounting year having a duration of 12 months, except in exceptional cases (in particular for the first year),
  • transfers of shares must generally obtain the unanimity of the partners,
  • several events can lead to the dissolution of the SNC: death of a partner, dismissal of a manager, etc.

Constitution of the SNC

When setting up an SNC, it is necessary to write articles of association containing the following information:

  • the legal form: general partnership,
  • the duration of the company,
  • the corporate name,
  • the corporate purpose,
  • headquarters,
  • the amount of share capital,
  • and the identity of the founding partners.

In addition, it is frequently imperative to add several clauses to organize the operation of the SNC:

  • everything concerning the management of the company (appointment, powers, remuneration, etc.),
  • the methods related to collective decision-making,
  • the opening and closing dates of the accounting years,
  • the terms and conditions for the distribution of profits...

The drafted document must be recorded in writing, by private deed or by notarial deed. If no manager is appointed, all partners are managers.

Any modification of the statutes must be the subject of an extraordinary decision of the partners (with the exception of rare exceptions).

Procedure for creating an SNC

To carry out the constitution of the SNC, the founders must submit a file to the business formalities body on which they depend, which contains:

  • a copy of the statutes signed by all the members,
  • an M0 form completed and initialed by the manager (or a third party) in triplicate,
  • a power of the manager in the event of signature of the M0 form by a designated person,
  • the certificate of the depositary of the funds,
  • the certificate of publication of a notice of incorporation in a journal of legal announcements,
  • confirmation of the regular use of the premises serving as the registered office,
  • for regulated activities: a copy of the document certifying the exercise of the activity,
  • a possible copy of the contribution auditor's report,
  • the act of appointment of the auditor and his deputy,
  • the act of appointment of the manager(s) if they are not designated in the articles of association,
  • for the manager(s) and each member: a declaration of non-conviction, a certificate of filiation and a copy of an identity document,
  • court fees related to the registration of the company.

The SNC account agent

The provisions relating to the obligation to appoint an auditor for the SARL are identical to those that apply to NCS. A commissioner must be appointed when the SNC exceeds, at the end of the financial year, one of the following three thresholds:

  • 8 euros excluding tax in turnover,
  • 4 euros in total balance sheet,
  • And an average workforce of 50 employees.

In addition, an auditor must be appointed at the request of a partner, regardless of his percentage of participation in the share capital.


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