Public limited company (SA/NV)
What is a public limited company ?
A public limited company is a prime example of a trading company which has the benefit of completely separating company assets and shareholder assets.
The major downside of this kind of company is the requirement to immediately have a capital of €61,500, which not all young entrepreneurs will have available to them right at the start. The easy transferability of shares can create uncertainty around the stability of the shareholders. However, the public limited company is still the most suitable company structure for many projects.
THE FOUNDERS
A single shareholder is required to create a public limited company. This may be a natural person or a legal entity.
SUBSCRIBED CAPITAL
The amount of capital that future founders undertake to make available to the company is €61,500.
CAPITAL PAID UP UPON COMPANY FOUNDING
The paid-up proportion of the capital corresponds to what the partners contribute to the company directly. One quarter of the subscribed capital must be paid for each portion corresponding to a contribution in cash or in kind.
CONTRIBUTION IN KIND
Before creating the company, the founders must request a company auditor to record in detail every asset to be contributed in kind to the company and draw up a report on how the assets were assessed. They must also specify the compensation given to the founder in exchange for the assets contributed in kind.
FINANCIAL PLAN
The founders of a public limited company must draw up a financial plan and submit it, once signed, to a notary on the day the company is officially set up. This is a plan forecasting the income and expenses of the company for the first two financial years.
SECURITIES
Since 1 January 2008, it is no longer possible to issue shares anonymously (bearer shares). A public limited company can now only issue dematerialised or registered securities.
REGISTER OF SHARES
As soon as the company is founded, and provided there are still registered shares, the shareholders must complete a register of shares.
INCORPORATION DEED
It is essential for public limited companies to sign a notarial deed.
The incorporation deed will normally contain the company's articles of association. The articles of association contain the clauses establishing the company rules and governing the relationships with persons external to the company, relationships between shareholders, the powers of the company's representatives, and so on. Of course, they must comply with all legal provisions.
SHARE TRANSFER
In principle, the shares of a public limited company can be transferred freely. It is also possible to limit accessibility through approval, pre-emption and non-transferability clauses, without completely removing the right to transfer shares.
Approval clauses allow a body within the company, either the general assembly or the administrative body, to approve or reject a transfer of shares.
Pre-emption and preference clauses grant shareholders the right to buy shares before third parties based on the number of shares each one currently holds. Any shareholder wishing to transfer their shares must give priority to their fellow shareholders.
Non-transferability or stand-still clauses must always be time-limited and be exercised in the interests of the company.
ADMINISTRATION
There are three possible administrative models available, with a clear separation of competences:
- A singular management structure with a board of directors only;
- A sole director;
- A dual administration with a management board and a supervisory board; this is a genuine dual system, where no manager or director can sit on both boards. Both boards also have exclusive and distinct competences. The dual administration model will undoubtedly be deemed to restrictive by many SMEs.
The liability of the directors is legally limited according to the size, turnover and balance sheet total of the company in question.
Unless statutory provisions state otherwise, the general assembly can terminate a director's mandate at any point without needing to provide any justification.
OVERSIGHT
A company auditor shall be instated if the company exceeds at least two of the following three criteria: 50 workers, turnover: €9,000,000, balance sheet total: €4,500,000.
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