You decided to set up a company and chose the legal status of your future company. But you still need to choose the most suitable form for your project. This choice is essential for the future of your business. Do not hesitate to seek assistance in this process of setting up a company, from experts such as notaries, lawyers, jurists, accountants, tax specialists, auditors, etc.
You chose the legal status of your business and opted to set up a company. But you still need to choose the most suitable form for your project. This choice is essential for the future of your business. Do not hesitate to rely on experts such as notaries, lawyers, jurists, accountants, tax specialists, auditors, etc.
What are the most common forms of companies?
Limited liability company (SRL in French)
The limited liability company (SRL) is generally considered the most appropriate legal form of company for a small or medium-sized enterprise.
- An SRL may be formed by one or more persons.
- The SRL has its own legal personality which is distinct from that of the shareholders or the sole shareholder. It also has its own patrimony.
- It is in principle a private company: the shares are in principle registered (the owner is named, so it is possible to identify him or her) and the possibilities of transferring these shares are limited unless otherwise provided for in the articles of association.
- It is a limited liability company: the shareholders are only liable up to the amount of their contribution. In the event of the company's bankruptcy, creditors may not make any claim on the shareholders' own assets. There are, however, exceptions to this principle for the founders.
- The articles of association must be drawn up by notarial deed.
- There is no minimum requirement for initial capital, but it must be sufficient in the light of the activity envisaged.
The public limited company (SA in French)
The public limited company is a form of company primarily chosen by large companies, but it is also chosen by SMEs. It is preferable if there is a large capital requirement, as it can call on new external capital or attract public savings. It, therefore, allows the company to grow quickly.
- The public limited company is a form of company that is mainly focused on the contribution of capital by shareholders.
- This form of commercial company has the advantage of offering a complete separation between the company and its shareholders. Their liability is, therefore, limited to their contribution. The securities are, as a general rule, easily transferable and without limitation. So, it is a form of company that has less of a family business character.
- This form of company must be incorporated by notarial deed. It requires a minimum capital of 61,500 euros - yet few entrepreneurs have such a sum at their disposal when they start their business. Moreover, the administrative management of such a company is relatively cumbersome for small structures.
The cooperative society (SC in French)
An SC is a form of company that is formed by a minimum of three founders. The SC offers limited liability: shareholders are liable only up to the amount of their contribution. Moreover, in the event that the planned entrepreneurial project is integrated into the social economy sector, the cooperative form is the only one that authorises the application for approval as a "social enterprise", subject to compliance with certain conditions.
The partnership is a company of partners.
- The law does not set a minimum capital amount.
- Its existence depends entirely on the partners.
- This form of company requires few formalities.
- The partners remain jointly and severally liable for the company's commitments.
The limited partnership consists of general and limited partners.
- The general partners take care of the management.
- The limited partners are financial backers but cannot intervene in the management.
- The law does not set a minimum capital amount.
- Only the general partner is indefinitely and jointly and severally liable for the debts and losses of the company out of their assets. The limited partner is liable only up to the amounts they promised to contribute unless they are involved in the management of the partnership.
- A simple partnership is a company that has no legal personality.
- In order to exist, it requires that two or more persons called associates agree (orally or in writing) to pool their contributions with a view to sharing the direct or indirect financial benefit that may result.
- The associates of a simple partnership are unlimitedly bound by the commitments of the company regarding third parties.
It should be noted that, although it avoids many of the legal formalities that may be required of companies with legal personality, as from 1 November 2018 a simple partnership must register with the CBE as a company subject to registration before it can start its activities. This registration process is done via a business counter.
Royal Federation of Belgian Notaries
Rue de la Montagne 30 - 34
Tel.: +32 2 505 08 50