What is an Société Unipersonnelle à Responsabilité Limitée (SURL)?

The Société Unipersonnelle à Responsabilité Limitée (Single-member private limited liability company) is a limited liability company with a sole shareholder, who may be a natural person or a legal entity. 

It allows someone to set up a company with a minimal amount of share capital.

Like the SARL (Private limited liability company), it limits the sole shareholder's liability to the amount of their contribution, and keeps their personal and business assets strictly separate. 

The manager of the company does not have to be a shareholder.

A sole shareholder is needed to set up an SURL.

The company is referred to by its official company name, which may include the name of the shareholder, but must always be immediately preceded or followed by the words "société unipersonnelle à responsabilité limitée" or the initials "S.U.R.L." and a statement of the company share capital. 

The sole shareholder may be a natural person or legal entity.

They exercise the powers vested in the shareholders’ meeting by the provisions of Chapters III and V du Titre IV Title IV of the Code de Commerce (Commercial Code).  

The sole shareholder may not delegate their powers. Their decisions, taken in the general meeting’s stead, are recorded in a register kept by the manager. 

The SURL carries out commercial activities.  The professions and non-trading activities cannot be performed by an SURL.  Some other activities cannot be performed by an SURL, such as finance and insurance, with the exception of insurance brokerage.

Neither the sole shareholder nor the manager personally have the status of a merchant or trader.

Since commercial capacity is not required, minors, even those who are not emancipated, and adults under judicial protection, guardianship or curatorship can be shareholders.

The minimum share capital for an SURL is € 8,000 if the sole shareholder is a natural person and € 15,000 if the sole shareholder is a legal entity.

The company share capital may be comprised of cash contributions (paid in the form of a sum of money) and/or contributions in kind (in the form of equipment, patents, etc.).

The shareholder may also contribute in the form of know-how, skills, or services. These are known as "contributions in industry", akin to what is often called sweat equity. 

The rules for subscribing shares in this way are set down in the Articles of Association. Shares awarded in exchange for contributions in industry are non-transferable.

Important: "Contributions in industry" do not count towards a company’s share capital, but they may entitle the contributor to shares. These shares give the right to a share of the profits and of any remaining assets if the company is wound up, but also require the contributor to bear their share of any losses
 

Articles of Association

The Articles of Association are drawn up as a privately-signed deed or as an official deed (notarized instrument).

However, when the share capital is formed, in whole or in part, of property assets subject to land registration at the Mortgage Registry Office, the notarized deed must be used.

Mandatory inclusions

The Articles of Association must indicate the following:

• The company's legal form
• The company name  [See Article 35-2 of the Code de Commerce (Commercial Code)]
• A statement indicating that the company’s registered office is located in Monaco
• The duration of the company. The duration of a company cannot exceed 99 years. The date of effect of the company must be stated: the date of signature of the Articles of Association, date of registration or fulfilment of the condition precedent of obtaining official authorization to do business
• Details of the shareholder’s identity. If they are a natural person, this includes their surnames and first names, date and place of birth, nationality. For a legal entity, it means the company name and legal form, the jurisdiction in which it is registered, and its registration number if applicable
• The company’s objects  
• The amount of share capital 
• The form and amount of capital contributions made by the shareholder (including the valuation of each contribution in kind see [Article 35-3 of the Code de Commerce (Commercial Code)]
• The number of shares held by the sole shareholder and the rights attached to them 
• The company year-end 
• Appointment of Manager(s) 
• The rules governing how the company is run 

Optional items 

The  Articles of Association may include other items, for example:

• How shares may be transferred
• How the company may be liquidated

Documents to be appended to the Articles of Association:

The following must be appended to the Articles of Association:

• The auditors' report, if applicable
• A special power of attorney granted to a proxy, if applicable
• Several copies certified as true copies by the legal representative to be deposited with various entities (e.g. credit institution)

Share capital

If the sole shareholder is a natural person, the minimum share capital is EUR 8,000.

If the sole shareholder is a legal entity, the minimum share capital is EUR 15,000.

It must be fully paid up. This means that the amount of share capital defined in the Articles of Association of the compagny must correspond to the founder' total undertakings.

The sole shareholder makes a contribution in cash or in kind to the company share capital and in return receives shares.

Cash contributions

When a company is set up, any contributions in cash must be paid up to at least the minimum required share capital. 

The money must be deposited into an account specifically opened for this purpose with a credit institution in the Principality. Proof of this deposit is needed when registering the company with the Trade and Industry Directory. 

The share capital must be fully paid up within a maximum of 18 months. Otherwise, anyone with an interest in the company can ask for the share capital to be reduced to the amount that has actually been paid up.

Contributions in kind

Contributions in kind must be fully paid up upon incorporation. In principle, contributions are made by transferring ownership of the asset to the company.

However, a contribution of enjoyment, by means of which the asset contributed is rented to the company in exchange for the allocation of shares, can also be considered.

If the contribution in kind is in the form of a business and its assets, a valuation must be made by an auditor chosen by the future shareholder, from among Monegasque chartered accountants.

However, the future shareholder may decide that he will not use the services of an auditor.

In this case, he will liable for 5 years in respect of third parties for the value attributed to the contributions made when the company was formed. Third-party action is not permitted in excess of this amount.

The shareholder' liability may also be incurred if the value of contributions chosen differs from the amount proposed by the auditor.

The registered office 

The registered office of an SURL is established on commercial premises (commercial lease, short-term lease or temporary tenancy agreement).

However, it is possible to domicile the company at the Manager's personal address in Monaco for a duration of one year, that may be renewed once, as from publication in the "Journal de Monaco" of the transcript of the Articles of Association if:

• No legislative, regulatory or contractual provision is opposed thereto
• The company's activities do not involve reception of clients or the storage or display of goods
• The company employs no staff

It is also possible, under certain conditions, to domicile the company:

• Either with a domiciliation company for a period limited to one year (may be renewed once)
• Or on premises occupied by another company

See the factsheets concerning domicile

Management

An SURL must be managed by one or more natural persons. A natural person cannot therefore be the Manager of an SURL [See Article 35-4 of the Code de Commerce (Commercial Code)].

Management may be performed by the sole shareholder or by a third party. The Manager, even if they are not a shareholder, is not considered as a trader.

Appointment and removal of the Manager

The manager is appointed by the sole shareholder in the  Articles of Association   and may be removed under the conditions laid down therein.

If not otherwise specified in the Articles of Association, he is appointed for the whole duration of the company.                                              

During the course of the company's existence, the manager is appointed by the sole shareholder.

Manager (non-shareholder)

The manager, if not a shareholder, falls under the social security regime for self-employed workers: they must therefore be affiliated to the Caisse Autonome des retraites des travailleurs indépendants (Independent Pensions Fund for the Self-Employed) and the Caisse d’assurance maladie, accident et maternité des travailleurs indépendants (Social Security Fund for the Self-Employed).

Powers of the Manager

With regard to the sole shareholder

The Manager may carry out any and all acts that are required or appropriate in fulfilling the company objects, subject to powers bestowed by law or the Articles of Association upon the shareholder.

If the Articles of Association do not place any limitations on the shareholder’s powers, the Manager may thus carry out any and all acts of management insofar as the latter are related to the activities of the SURL and are in line with the company’s interests.

In this regard the Manager may, in the name of the company and in line with company objects, sign contracts, hire staff, take legal action, etc.

The Manager's powers can be limited by:

• The Articles of Association: certain clauses may render certain acts subject to prior authorization by the shareholder
• The powers bestowed upon shareholder by the law: the company's legal representative cannot take any action that is solely incumbant upon the shareholder, such as amendments to the Articles of Association or transfers of goodwill leading to the liquidation of the company
• This means that the Manager does not have the power to change the company objects alone, for example

Managers that exceed their powers incur their personal liability in respect of the sole shareholder, who may obtain compensation for the prejudice or remove the Manager for just cause.

With regard to third parties

In respect of third parties, the Manager is granted the most extensive powers to act in all circumstances on the company's behalf, subject to the powers attributed specifically to shareholder by the law.

 Any clause of the Articles of Association limiting the Manager's powers cannot be enforced against third parties, even if the latter were aware of the existence of such a clause.

The Manager's obligations

In respect of the sole shareholder

The Manager must keep a register recording all of the decisions taken by the sole shareholder in the General Assembly’s stead. Otherwise, any decisions taken by the sole shareholder may be annulled at the request of any interested party.

The Manager makes the company’s annual financial statements and management report available for the sole shareholder or their representative to inspect at the company’s registered office. The sole shareholder or their representative may obtain a copy. 

In respect of third parties

In order to render certain corporate deeds enforceable against third parties, the Manager must perform publication formalities which vary according to the nature of the resolution.

In this regard, any amendment to the Articles of Association relating to the form of the company, its objects, the appointment of Managers, the amount of share capital, duration of the company, and transfer of the registered office require notice to be published in the Journal de Monaco and the depositing at the General Registry of the minutes of the Extraordinary General Meeting, so that they may be posted there.

Liability of the Manager

The Manager is responsible to the company and to third parties for negligence that they might commit in carrying out their duties. In this regard, the Manager incurs their civil and/or criminal liability.

Civil liability of the Manager

The Manager's civil liability may be incurred if:

• The Manager has committed negligence
• Such negligence has caused prejudice (to the company, to the sole shareholder or to a third party)
• There are three types of negligence that may incur the Manager's civil liability:
  • Infringements related to legal and regulatory provisions applying to company law
  • Breaches of the Articles of Association (specifically those clauses requiring the Manager to obtain prior approval from the sole shareholder when taking certain decisions)
  • Acts of mismanagement, such as accepting orders that they know the company will not be able to fulfil

With regard to the tax administration and social security administration, the legal representative of the SURL may incur their personal liability if it is proved that, through fraudulent manoeuvres or through serious and repeated non-compliance with tax and/or social security obligations, they have made the recovery of sums due by the company to said administrations impossible.

Individual liability in the event of collective proceedings

In the event of collective proceedings, the Manager may be ordered to pay all or part of the SURL's debts if they have committed mismanagement, on the basis of Article 560 of the Code de Commerce (Commercial Code).

Liquidation of assets will be declared pursuant Article 565 of the Code de Commerce (Commercial Code) against Managers that have:

• Done business in their personal interests or on behalf of a third party under cover of the company, masking their actions
• Used company assets as their own
• Improperly continued operations generating losses that could only lead to suspension of payments for the company, in a personal interest or on behalf of a third party

The Manager may also be the subject of personal bankruptcy measures or a prohibition from directing, managing, running or controlling a privately-held commercial undertaking or a company, on the basis of Articles 573 to 578 of the Code de Commerce (Commercial Code).

Criminal liability of the Manager

The Manager may incur their liability, pursuant to Article 51-12 of the Code de Commerce (Commercial Code) in the following cases:

• If they have not instigated the appointment of one or more auditor(s) or if they have refused to communicate to the auditors the documents required in order for them to fulfil their duties
• If they have not had the certificate relating to the annual accounts described in Article 51-7 of the Code de Commerce (Commercial Code) signed by a member of the Order of Chartered Accountants and Authorised accountant or if they have refused to communicate to the latter the documents necessary to obtain their signature

The Manager may incur their liability, pursuant Article 51-13 of the Code de Commerce (Commercial Code) in the following cases:

• If they have not produced accounting documents or if they have not submitted those documents for approval by the shareholder in breach of the provisions of  Article 51-6 of the Code de Commerce (Commercial Code)
• If they have not sent these documents to the Trade and Industry Directory in breach of the provisions of Article 51-7 of the Code de Commerce (Commercial Code) 

The Manager may incur their liability if they commit the criminal offences laid down in Act No. 1,144 of 26 July 1991, amended, such as carrying on an activity ultra vires the company objects.

The shareholder has the right to inspect information about the company’s management, to the extent that they actively participate in its affairs and take decisions about how the company is run.

An SURL comes to an end in the following situations:

1. When the period for which it was set up expires, unless the shareholder decides to extend it in accordance with Article 1704 of the Code Civil (Civil Code)  
2. When its company objects have been achieved or no longer exist 
3. When the sole shareholder decides to dissolve the company early 
4. By a final court decision ordering early dissolution at the request of the shareholder for valid reasons
5. By a final and unappealable court judgment annulling the company’s Articles of Association or ordering early dissolution as provided for under Article 1703-I of the Code Civil (Civil Code)  
6. By a final and unappealable court judgment ordering that the company be liquidated or all of its assets transferred 
7. For any other reason specified in the company’s Articles of Association

If the company is dissolved, all of the company’s assets are transferred to the sole shareholder, with no liquidation. Where the sole shareholder is a natural person, the assets are only transferred in this way if the company is solvent.