Definition of an SAS: understanding the Société par Actions Simplifiée (simplified joint stock company) before taking the plunge.

Creating an SAS is not just a matter of choosing one of several types of company status: it means opting for a business form that combines flexibility, freedom and legal certainty.

This simplified joint-stock company is attracting more and more partners, whether individuals or legal entities, because it allows the rules of operation, share transfer clauses, management and decision-making at the general meeting to be defined from the outset. The Articles of Association provide a clear framework for the Chairman or Director, while the shareholders organise the distribution of share capital, capital increases, the appointment of directors and the distribution of dividends.

But beware: this freedom in the articles of association means that every legal provision and every registration formality must be mastered, otherwise clauses may block a collective decision or restrict the transfer of shares. Are you wondering whether the SAS is right for your business project?

Let’s take a look at its characteristics, its advantages and the key points to consider before setting it up.

However, this flexibility requires the support of a law firm specialising in company law to ensure that each clause is secure (approval, inalienability, powers of directors, etc.). In this article, Goldwin Avocats explains the essential points you need to know before setting up your SAS.

Understanding SAS at a glance

Definition and legal framework of an SAS

The Société par Actions Simplifiée (SAS) is a legal form governed by articles L.227-1 et seq. of the French Commercial Code. By its very nature, it belongs to the category of commercial companies, whatever its corporate purpose. This means that an SAS may carry out commercial, craft, agricultural, liberal or industrial operations up to the amount of its contributions, provided that it complies with the regulations applicable to its sector.

Restrictions exist in certain sensitive sectors, but they remain the exception. This applies, for example, to sectors related to national defence, private security, financial and banking services,insurance, investment fund management or certain professions that require approval, administrative authorisation or specific conditions of qualification and capital ownership (health, law, notaries, etc.).

The law requires at least 2 partners at the time of incorporation, except in the case of a SASU (société par actions simplifiée unipersonnelle). The partners may be natural or legal persons, and there is no nationality requirement, making this structure particularly suitable for international projects.
To set up a simplified joint-stock company, the articles of association must set out the company’s name, the address of its registered office,its objects, the duration of the company, the amount of share capital, the governance arrangements and the rules for transferring shares. The company is registered with the commercial court registry via the online one-stop shop. This procedure formalises the company’s legal personality and enables it to act in its own name in dealings with third parties.

Main features

The SAS has three main characteristics:

• Great freedom under the articles of association: the shareholders have almost total autonomy to determine the internal organisation, the division of powers between directors, the decision-making process, the conditions under which shareholders may join or leave the company, and any special voting clauses. This ability to define one’s own rules also makes it possible to anticipate the resolution of internal conflicts by means of appropriate clauses.
• Limited liability: each partner is only liable for the amount of his contribution (in cash or in kind). In the event of debts, creditors cannot seize partners’ personal assets, except in the case of mismanagement or fraud.
• Flexibility of operation: unlike the SA, the SAS does not require a board of directors or supervisory board. The only mandatory position is that of chairman, who may be a natural person or a legal entity. The articles of association may, however, provide for managing directors, a strategic committee or a supervisory board if this is appropriate to the company’s needs.

Why choose a société par actions simplifiée?

The advantages of an SAS

There are a number of reasons why entrepreneurs and investors are attracted to the SAS:

• Flexibility of the Articles of Association: the operating procedures can be fully adapted to the project, which is crucial for start-ups, growing SMEs and multi-capital structures. For example, the partners can draw up a shareholders’ agreement detailing the rights and obligations of each party.
• Limited liability: potential losses are limited to the amount of the contributions, providing essential protection for the partners’ personal assets.
• Protectivesocial security regime: the chairman and directors treated as employees are covered by the general social security regime, including retirement, sickness, maternity and possibly unemployment insurance, under certain conditions.
• Easier to attract new investors: the structure makes it possible to introduce preference shares, double or differentiated voting rights, or approval clauses to secure share ownership.
• Simplified transfer: the transfer of shares is generally simpler and less costly than the transfer of shares in an SARL, which facilitates the mobility of capital.

The disadvantages of an SAS

The flexibility of an SAS has a downside:

• It costs more to set up than some other legal forms, in particular because of the need to draft bespoke articles of association and the associated costs (publication, registration).
• Legal complexity: poorly drafted clauses can block certain decisions or create deadlock when shares are transferred.
• Higher social security contributions than for self-employed workers, which can weigh on fixed costs, especially when the business is first launched.
• Limits on financing : unlike a public limited company (SA), an SAS cannot be listed on the stock exchange or issue shares on a regulated market. As a result, it cannot make apublic offering, which reduces the options for financing through a public offering of financial securities.
• Lack of an employee spouse scheme: the manager’s spouse cannot officially take part in management unless he or she is an employee or partner, which limits certain family organisations.

Internal operation of an SAS

Organisation and management

The Chairman of the SAS is the legal representative and holds executive power. He signs contracts, commits the company and is responsible for day-to-day management. The scope of his powers is set out in the Articles of Association, which may also allocate certain responsibilities to one or more managing directors, a committee or a board. This organisation may be centralised around the Chairman or divided between several decision-making bodies.

In the absence of specific provisions, the Chairman may act alone for all decisions that do not amend the Articles of Association. However, any major change (capital increase, change of registered office, exclusion of a partner, etc.) requires a collective decision by the partners, often unanimously, at an Extraordinary General Meeting.

Decision-making and meetings

Collective decisions may be taken at ordinary or extraordinary general meetings, but also by written consultation, videoconference or any other method provided for in the articles of association. The shareholders are free to set the quorum and majority requirements and the decisions that must be taken jointly.

Shareholders have financial rights (to receive dividends), political rights (to attend meetings and vote according to their share) and information rights. A shareholders’ agreement is often drawn up to govern their relationship. This confidential, contractual document can be used to organise specific aspects (approval clauses, pre-emption rights, inalienability, etc.) without having to amend the Articles of Association, a more cumbersome and costly procedure.

Goldwin Avocats, experts in drafting contracts and shareholders’ agreements, can help you secure your collective decisions and prevent any future conflicts between shareholders.

Liability of partners and directors

Partners’ liability is limited to the amount of their contributions: they cannot be required to pay the company’s debts beyond what they have invested. However, in the event of mismanagement, directors may be liable for their personal assets.

The stages involved in setting up an SAS

Setting up a simplified joint stock company follows a precise sequence of legal and administrative procedures. Depending on the type of business you are planning, you will need to carry out a number of preliminary checks to avoid any problems when you register with the one-stop shop.

Check prerequisites and regulated professions

Any individual or legal entity can join an SAS. However, if the business is regulated, specific conditions must be met, otherwise registration may be refused. This may involve :

• obtaining a recognised diploma or professional qualification
• Membership of a professional body (e.g. chartered accountant, lawyer, doctor)
• taking out compulsory insurance
• providing financial guarantees

This may apply, for example, to fund management, the healthcare professions, modelling agencies, opticians, discotheques, etc.

Determining the company name and registered office

Choosing the name of the SAS

The company name must be unique, in keeping with public policy and morality. Before validating it, we recommend that you check its availability with INPI and, if necessary, protect it to avoid any fraudulent use.

Establishing the registered office

The registered office determines the nationality of the company and the competent jurisdiction. The registered office can be located :

• At the domicile of the Chairman (under certain conditions)
• In rented or purchased commercial premises
• In an approved domiciliation company

Proof of occupancy of the premises (lease, receipt, domiciliation contract) must be provided.

Plan the duration of the company

An SAS may exist for a maximum of 99 years. The partners may opt for :

• A fixed term (in years or months)
• An end conditional on the occurrence of an event (for example, the completion of a specific project)

This term is set out in the Articles of Association and may be changed at a later date by a collective decision.

Establishing the share capital and defining the contribution

The share capital is freely determined by the partners. If the share capital is too low, it may undermine the company’s credibility with financial partners, while if it is too high, resources will be tied up unnecessarily.

Possible types of contribution :

• cash: a sum of money deposited in a blocked account, at least 50% of which is paid up on incorporation (the balance within 5 years).
• contributions in kind: tangible or intangible assets (machinery, buildings, trademarks, patents), sometimes requiring an appraisal by an auditor.
• contributions in kind: tangible or intangible assets (machinery, buildings, trademarks, patents), sometimes requiring valuation by an auditor.

The deposit of funds gives rise to a certificate, which must be provided when applying for registration.

Drafting the articles of association of an SAS

The Articles of Association set out the rules of operation and governance. They must specify :

• The identity of the shareholders
• Legal form (SAS) and company name
• The corporate object
• The registered office
• the duration
• The amount of share capital and the distribution of shares
• Management and decision-making procedures
• Terms and conditions for the sale or transfer of shares
• Distribution of profits

Possible specific clauses: approval clause, inalienability clause, pre-emption clause, joint exit procedure, operation of shareholders’ current accounts.

ADVICE : The considerable autonomy given to partners makes drafting the articles of association a complex task. Goldwin Avocats, experts in business law, can help you at this key stage to secure your clauses and anticipate any future difficulties.

Publish the incorporation notice in a legal gazette

It’s impossible to miss: publication of the notice of incorporation is the step that makes the creation of your SAS official and public. In practical terms, this is an act of transparency designed to inform third parties of the company‘s existence.

The notice must mention :

• the legal form and company name,
• thecorporate object
• the duration of the company
• the registered office
• the amount of capital,
• theidentity of the directors,
• and the competent registry.

At the end of this stage, you will receive a certificate of publication: an essential document to enclose with your application for registration. Without this proof, the company cannot be entered in the Trade and Companies Register.

Gathering supporting documents

This is the time to gather together all the essential documents that will enable the registrar to validate the creation of your SAS. Without a complete set of supporting documents, it will be impossible to obtainregistration. The essential documents are :

• a signed copy of the Articles of Association
• acertificate of deposit of capital
• proof of publication in a legal gazette
• a declaration of non-conviction and filiation for each director,
• proof of registered office address,
• authorisation or approval if theactivity is regulated,
• the report of the contributions auditor (if necessary),
• an identity document for the chairman or a Kbis extract for a legal entity.

Each of these documents plays a key role: without them, the company will simply not see the light of day.

Registering the SAS with the one-stop shop

Since 1 January 2023, all the formalities involved in setting up a company have been carried out via the online one-stop shop managed by INPI. This is the final stage in transforming a project into an officially recognised company.

Registration automatically entails :

• registration in the Trade and Companies Register (RCS),
• issue of the Kbis extract, the company’s identity card,
• the release of funds deposited as capital.

Once this stage has been completed, the SAS acquires its legal existence and can finally carry out its activities in complete security.

How much does it cost to set up an SAS and how long does it take?

Before setting up an SAS, it is important to anticipate the compulsory and optional costs associated with legal formalities, the drafting of the Articles of Association and any support services, as well as the time needed to finalise registration. Once the documents have been submitted, you should allow 1 to 2 weeks.

Tax and social security regime for an SAS

Taxation of profits

By default, an SAS is subject tocorporation tax (impôt sur les sociétés – IS). This means that profits are taxed in the name of the company at the standard rate of 25%, with a reduced rate of 15% on part of the profit if certain conditions are met (capital fully paid up, at least 75% owned by individuals, turnover below a defined threshold).
An option forincome tax is available for a maximum of 5 financial years if the company meets certain conditions:

• it has been in existence for less than 5 years
• have sales of less than €10 million
• has fewer than 50 employees.

This option is often used so that partners are taxed directly on profits, which can be advantageous in the start-up phase when income is modest.

Please note: This tax option should be anticipated when the company is set up, as it has a direct impact on cash flow, dividend distribution and the personal tax situation of the partners.

Chairman’s social security regime

The Chairman of an SAS, whether a partner or not, is covered by the general social security system as anemployee. This guarantees them full social security protection (sickness, basic and supplementary pensions, family allowances, industrial accident cover), but they are not automatically covered by unemployment insurance, unless they have an employment contract with an effective subordinate relationship.

The amount of social security contributions is proportional to the gross remuneration paid, with no minimum contribution if there is no salary. This scheme is often chosen for the security it provides, particularly in terms of pensions, even though it is more expensive than the scheme for non-salaried workers (TNS).

Accounting obligations

SASs must keep regular accounts in accordance with current standards, draw up annual financial statements (balance sheet, profit and loss account, notes) and filethem with the Registrar of the Commercial Court.
A statutory auditor must be appointed if the company exceeds two of the following three thresholds:

• total assets of €4 million
• sales of €8 million
• 50 employees

This requirement also applies if the SAS controls or is controlled by another company. Compliance with these obligations is essential to avoid penalties and loss of credibility with financial partners.

Differences between SAS and other legal forms: making the right choice

Before setting up your company, it is essential to compare the SAS with other legal forms such as the SARL or SA. The table below summarises the key criteria to help you make the right choice.

SAS vs SARL

The SARL is more closely regulated by law, which gives certain aspects greater security but limits flexibility. The SAS, on the other hand, offers almost total freedom in its articles of association, allowing precise definitions of governance, the distribution of voting rights and the conditions for transferring shares.

For a family company where you want predefined operations and simplified administration, the SARL may be appropriate. For a company that needs to raise funds, attract investors or set up complex structures, the SAS is more appropriate.

SAS vs SA

The SA (Société Anonyme) is designed for large companies, often listed on the stock exchange, with a minimum capital of €37,000 and highly formalised governance (board of directors or management board accompanied by a supervisory board). The SAS, on the other hand, offers flexibility and lighter management. It is particularly attractive to SMEs and companies that want a personalised organisation.

SAS vs SASU

The SASU is simply an SAS with a single shareholder. It retains the same statutory freedom and liability protection, but all decisions are taken by a single shareholder. It is ideal for entrepreneurs wishing to retain control while benefiting from the advantages of the status.

Common mistakes to avoid when setting up a company

Setting up an SAS offers a great deal of freedom, but certain mistakes can be costly in the first few years. Here are the most common pitfalls:

• Poorly drafted articles of association: a simple oversight can bring the whole business to a standstill. Imagine a missing approval clause: a partner could sell his shares to a direct competitor without you being able to object.
• Poorly thought-out share capital: choosing too low an amount gives the impression of a fragile company and makes access to finance more difficult. Conversely, tying up €100,000 from the outset can dry up cash flow. The right balance is often found in credible but flexible capital.
• Ignoring tax and social security obligations: many people underestimate the costs associated with being a salaried employee or the taxation of profits. The result: cash flow plummets in the first year. A solid business plan can help you to anticipate and avoid unpleasant surprises.

So before you go ahead, it’s essential to make sure you’re on the right track at every stage. The lawyers at Goldwin Avocats can analyse your articles of association, your choice of capital and your tax forecasts to avoid these pitfalls and protect your project from the outset.

How do you dissolve an SAS?

Possible reasons for dissolving an SAS

Terminating an SAS is a decision with far-reaching consequences, often linked to a strategic decision or unforeseen events. Identifying the most common reasons for dissolution in advance helps you to anticipate this step and manage it with greater peace of mind.

• Reaching the term set out in the Articles of Association: when the company is formed, a maximum term is set (usually 99 years). If the shareholders do not vote to extend the company’s term, it must be dissolved.
• Voluntary decision by the shareholders: they may decide at any time to cease trading for strategic, personal or economic reasons, even if the company is in good financial health.
• Realisation or extinction of the corporate purpose: when the mission set out in the Articles of Association is completed (for example, when a one-off operation is terminated) or becomes impossible to continue (for example, when a major contract is lost).
• Financial difficulties: in the event of suspension of payments, the company may be wound up by the Commercial Court.
• Other reasons provided for in the articles of association: special clauses, triggering events (loss of a key partner, change of control, etc.).

Stages of liquidation

Winding up an SAS cannot be improvised. It is a strict procedure under the French Commercial Code, where skipping a single stage can block the deregistration and expose the partners to penalties. From dissolution by a general meeting of shareholders to the appointment of a liquidator, the sale of assets, the settlement of debts and, finally, the filing of closing accounts, each phase must be carried out rigorously. Theinfographic below details the entire process, in 9 stages, right up to the closing of the liquidation: validation of the accounts by the partners, distribution of the net assets and final filing with the registry. It is only after this validation that the company is struck off the Register of Companies and ceases to exist as a legal entity.

How much does it cost to close an SAS?

The costs of closing an SAS vary according to the complexity of the liquidation, the value of the assets and the fees of the parties involved:

• Publication costs in a JAL: approximately €150 per announcement (dissolution + liquidation closure).
• Court clerk’s fees : approximately €40 for the dissolution and €14 for the closure, i.e. a total of around €54.
• Liquidator’s fees : if the liquidator is a professional (lawyer, chartered accountant, court-appointed agent), the fees will vary depending on the time spent and the complexity of the operations.
• Other possible costs: legal support, updating of documents, cancellation of trademarks, bank charges for closing an account.

On average, for a simple amicable closure, the minimum budget is €300 to €500, but this amount can be considerably higher in the case of major assets, disputes or legal proceedings.

The implications of SAS for partners of different nationalities

An SAS can have partners of any nationality, making it a flexible and attractive form of company for international projects. Only certain sensitive activities (defence, banking, insurance, etc.) require specific authorisations. In practice, however, a legal representative must have an address in France and foreign documents must be translated, legalised or apostilled, which can lengthen the process of setting up the company. Banks also apply stricter controls (KYC) when opening a bank account. Finally, dividends paid abroad may be subject to withholding tax, the rate of which depends on the tax treaty. Properly managed, these constraints are largely offset by the strategic advantage of involving foreign partners: diversified financing, increased credibility and access to new markets.

Conclusion

The SAS is a company with a unique freedom to create tailor-made organisational rules. The Articles of Association make it possible to distribute powers, appoint a chairman or a managing director, and anticipate key decisions to avoid bottlenecks. This flexibility gives partners a clear framework, while leaving room for innovation and structural change. Properly drafted, the Articles of Association become a real lever of stability and confidence, capable of supporting both individual ambitions and long-term collective development.

FREQUENTLY ASKED QUESTIONS ABOUT THE SAS

Can dividends be distributed to a single SAS shareholder?

Yes, if justified by the shareholding and authorised by the Articles of Association, the General Meeting may decide to distribute all dividends to a single shareholder, provided that the accounts show a distributable profit.

How is the value of shares calculated?

Valuation depends on the organisational rules set out in the Articles of Association or on an agreement between partners. There are several possible methods: net book value, valuation based on future cash flows, or comparison with similar companies. In some cases, a resolution at a general meeting may be required to validate the calculation. Whichever method is chosen, it is advisable to consult a qualified expert to ensure that the price set is fair, enforceable against third parties and compliant with the legal status of the SAS.

Is it possible to have an SAS and be a self-employed entrepreneur?

Yes, it is possible. A person can combine the two statuses if the legal provisions are complied with and there are no incompatibilities. The combination must take account of the tax and social security obligations of the SAS, the specific taxation of the auto-entrepreneur and compliance with the French Employment Code. In some cases, a resolution at a general meeting or adjustments to the organisational rules may be necessary to avoid any conflict. This combination offers considerable flexibility, but it must be regulated to ensure that it complies with French law and is enforceable againstthird parties.

Why convert a SARL into an SAS?

Changing from a limited liability company to a simplified joint stock company can offer greater flexibility in governance and the possibility of adopting personalised operating procedures. This makes it easier to draw up a precise agreement, put in place clauses tailored to the partners or investors, and provide more flexible management for a manager looking to develop his business.

How many partners are there in an SAS?

In principle, at least two people are needed to set up this type of company. However, there is the SASU (Société par Actions Simplifiée Unipersonnelle), which allows one person to hold all the shares. This format retains most of the advantages of the multi-stakeholder version, while simplifying certain obligations and making it easier to appoint a single director.

How do I increase the company’s capital?

There are three main ways of increasing the capital of an SAS:

• – New contributions: in cash (money paid into a blocked account) or in kind (assets, patents, real estate), with the involvement of a contributions auditor if necessary.
• – Incorporation of reserves: transformation of retained earnings or premiums into new shares.
• – Set-off of receivables: a shareholder converts a company debt into capital.

The process follows a precise pattern: convening general meetings, adopting a resolution, amending the Articles of Association to reflect the new amount, submitting the form to the court clerk’s office with the complete file, then publication in a legal gazette. The decision must be recorded in minutes and comply with internal organisational rules.

Done properly, this operation offers a strategic advantage: it strengthens the credibility of the SAS, reassures partners and improves its financing capacity.

How do you close an SAS with debts?

If the company is unable to repay its creditors, it may be placed in compulsory liquidation by the competent court. This procedure is governed by the French Commercial Code and involves the appointment of an agent to realise the company’s assets and pay off its liabilities. The end result is that the company is deregistered, after debts have been settled as far as possible.

How do you go from auto-entrepreneur to SAS?

Converting an auto-entrepreneur into an SAS is not a simple change: you need to create a new company and close the old structure. The key steps are :

• – Closing the auto-entreprise: declaration of cessation to URSSAF and regularisation of contributions and taxes due.
• – Setting up the SAS: drafting the articles of association, choosing the internal operating procedures, appointing a chairman or managing director, depositing the capital (at least €1 or €37,000 if the company is listed), publication in a legal gazette, then registration with the court registry.
• – Transferring the business: you can contribute the existing assets (customers, equipment, business name, etc.) in kind, or start afresh.
• – Updating the tax and social security arrangements for the SAS: switching from the micro system tocorporation tax (with the option of temporarily opting for personal income tax) and changing the status of the company director to that of an employee.

How do you leave an SAS?

A shareholder may sell his shares in accordance with the Articles of Association and any existing agreements. This transaction must comply with internal procedures and, where applicable, obtain the agreement of the other parties, depending on the restrictions adopted. A copy of the deed of transfer is then sent for registration and updating of the registers.