On the 21st of June 2024, the Government introduced a draft bill n°1.094, which aims to modernise corporate law.
It includes amendments to the legal framework for sociétés anonymes monégasques (S.A.M.), which are currently regulated primarily by the Civil Code, the Commercial Code and the Sovereign Ordinance of March 5th, 1895, as amended.
Simplification of incorporation publicity formalities
The incorporation of a S.A.M. must be published within three months of the filing of the notarial articles of association, once government approval has been granted. The company must send a copy of the deed of incorporation to the general court registry, together with the documents relating to the proceedings of the general meeting and the subscription and payment of the capital.
In addition, the company must fulfil publication formalities in the Journal de Monaco and register in the Répertoire du commerce et de l'industrie or in the Registre spécial kept by the Monegasque administration.
In order to simplify these formalities, draft bill n°1.094 aims to limit publication in the Journal de Monaco to a reference to the date of filing with the general court registry and the publication of an extract from the articles of association, rather than the full articles of association as is the case today.
New corporate governance rules
The draft bill aims to facilitate the identification of the legal representative of a S.A.M.
As the law currently stands, practice has led to the emergence of a large number of individuals who may or may not represent a S.A.M. in dealings with third parties (chairman of the board of directors, delegated administrator, chairman-delegated administrator, managing director, chief executive officer, etc.).
The draft provides for the standardisation of the governance of S.A.M.s through the positions of chairman and managing director. Both positions could be held by the same person.
The chairman would direct and organise the work of the board of directors, while the managing director would have the most extensive powers to represent the company in dealings with third parties.
However, the status of the delegated administrator could be adjusted in the articles of association. The delegated administrator may be assigned a specific task by the board of directors and, in agreement with the person responsible for the management of the company, may have powers limited to those conferred. Hence, the S.A.M. would not be bound by acts performed beyond these powers.
If the draft bill is adopted, S.A.M.s will be given three months to comply with these new governance rules.
Authorisation of contributions in sweat equity in S.A.M.s and S.A.R.L.s
The draft provides for the abolition of the prohibition of contributions in sweat equity in S.A.M.s and Monegasque limited liability companies (SARL).
Reduction of formalities required by the articles of association
During the life of the company, the draft provides that the prior approval of the Ministre d'Etat will no longer be required for changes to the share capital, company name or registered office of a S.A.M.
However, changes to the company object or its legal form would still require the prior approval of the Ministre d'Etat.
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