All of French Company Law: ordinary law of companies and specific regime for different types of companies

Company Law (en cours)

In accordance with Articles L. 210-6 of the Commercial Code and 1844-3 of the Civil Code, the decision to transform does not create a new legal entity that would overlap with the old one, but rather sees the succession of two forms of one and the same entity . Such unity is particularly evident in the case of an SARL transforming into an SA, maintaining the same corporate purpose, the same share c …

Transfer of rights and obligations to the new company

FISCEL, The absence of a new legal entity in company transformations, Gaz. Pal. 1986, II, doctr. 724; DONDERO, Transformation seen from the inside, BJS 2010, 400.

In accordance with Articles L. 210-6 of the Commercial Code and 1844-3 of the Civil Code, the decision to transform does not create a new legal entity that would overlap with the old one, but rather sees the succession of two forms of one and the same entity . Such unity is particularly evident in the case of an SARL transforming into an SA, maintaining the same corporate purpose, the same share capital, the same partners, without making any changes to its assets and liabilities .

The transformation does not affect the original legal personality , unless it occurs after the company has been dissolved  or if the hidden purpose of such an operation is to regularize a company whose purpose is unlawful . Consequently, a guarantee obligation undertaken in favor of the company transformed prior to the operation remains . Similarly, the company in its new form does not need to seek the landlord's approval to benefit from the lease it enjoyed under its former corporate form, as long as the transformation does not entail a transfer of the lease . The transformation is also not equivalent to a partial asset contribution, subject to registration duty, from the first form to the second . Finally, the company resulting from the new corporate form has an exclusive right to the name adopted by the company in its initial form .

The right to initiate legal action of the company in its former form is also transferred to the new form after the transformation, whether it is regular or not . The latter has the right to take action on contracts concluded by the former , allowing it to seek compensation for any damage resulting from them . Conversely, it becomes responsible for actions committed under its former form. Indeed, the restructuring operation does not alter the company's obligations towards third parties for a fault committed under its former corporate form , so that the company resulting from a transformation can be ordered to pay a financial penalty imposed on the original company .

Cass. com., 27 May 2015, LawLex202200009490JBJ.

Cass. com., 4 March 1969, LawLex202200009419JBJ, considering that the transformation of an SARL into an SA, where the corporate purpose, registered office, share capital and its distribution, and the partners remain the same, without any changes being made to its assets and liabilities, does not call into question, with respect to the SA, the commitments validly made by the SARL.

Cass. com., 18 March 2003, LawLex202200009435JBJ, indicating that the transformation of a company into a company of another form, even if irregular, cannot deprive it of its right to initiate legal action.

Cass. com., 7 May 2019, LawLex202200009438JBJ.

Cass. com., 30 October 2000, LawLex202200007756JBJ, holding that it has the legal standing to initiate legal action for the payment of a balance of commissions and a termination indemnity under a commercial agency contract concluded in its initial form.

Cass. com., 7 December 1993, LawLex202200008347JBJ.

Cass. 3e civ., 12 December 2001, LawLex202200009423JBJ; Competition Council decision No 02-D-43, 2 July 2002, LawLex200200002151JBJ.

Cass. 3e civ., 10 March 2004, LawLex202200009378JBJ.

Cass. com., 12 November 1992, LawLex202300002201JBJ.

Cass. com., 19 January 1970, LawLex202200010439JBJ, holding that an SARL founded on an unlawful cause that transforms into an SA with retroactive effect, without its fictitious nature disappearing, must be annulled, since the operation has no other purpose than to evade the formalities applicable to the first form.

Cass. com., 20 February 2001, LawLex202200009404JBJ, considering that the change in form of the principal debtor company, which does not result in the creation of a new legal entity, leaves the guarantor's obligation in place, unless otherwise agreed.

Metz, 22 February 2024, LawLex202400002155JBJ; Cass. 3e civ., 31 October 2012, LawLex202200009402JBJ, holding that the transformation into an SAS of an SCEA that has benefited from the contribution of a rural lease does not entail the transfer of the lease, subject to the landlord's approval, as it does not result in the creation of a new legal entity; 10 March 2004, LawLex202200009378JBJ, indicating that the transformation of a GAEC, tenant under a lease, into an EARL does not result in the creation of a new legal entity and the placement of the leased property at the disposal of a company with a primarily agricultural purpose, which would require informing the landlord.

Cass. com., 7 March 1984, LawLex202200009376JBJ, considering that the regular transformation of an SCS into a civil company cannot be equated with a contribution of assets subject to registration duties.

Cass. com., 6 November 1990, LawLex202200009406JBJ.

Cass. 2e civ., 8 July 2004, LawLex202200009430JBJ; Cass. 3e civ., 29 November 2006, LawLex202200008352JBJ, considering that acts subsequent to the transformation of an SNC into a civil company, decided by an extraordinary general meeting, must be considered as performed by the same legal entity, since the transformation does not result in the creation of a new legal entity.

Company Law (en cours)

213. Transfer of rights and obligations to the new company(1)

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Les notions juridiques connexes

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