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

Company Law (en cours)

The civil agricultural exploitation company, the limited liability agricultural exploitation company, the forestry savings company, the agricultural exploitation group, the agricultural land group, the forestry group, the pastoral group, and the rural land group are governed by the ordinary law of civil companies, except for special provisions, and benefit from tax advantages.

1) Agricultural or  …

Plurality of structures

PILLEBOUT, Farming Companies, Litec, 1986; FOYER, Some Current Remarks on the Definition of Agricultural Activity, RD rur. 2012, marker 6; CHANDELLIER, Agricultural Civil Companies and Commercial Activities: At the Limits of the Corporate Purpose, Dr. rural 2014, study 1.

The civil agricultural exploitation company, the limited liability agricultural exploitation company, the forestry savings company, the agricultural exploitation group, the agricultural land group, the forestry group, the pastoral group, and the rural land group are governed by the ordinary law of civil companies, except for special provisions, and benefit from tax advantages.

1) Agricultural or forestry civil companies

Civil agricultural exploitation companies (SCEA) use the framework of ordinary civil law companies, to which they assign an agricultural purpose. They are used for the operation of an agricultural estate and/or the management of land—built or not—or forests, and often have a family character.

Limited Liability Agricultural Holdings (EARL)  are created by one or more individual partners, up to a maximum of ten, who are only liable for losses up to the amount of their contributions. They are intended to carry out activities deemed agricultural within the meaning of Article L. 311-1 of the Rural and Maritime Fishing Code. Their legal framework is defined in Articles L. 324-1 to L. 324-10 and D. 324-2 to D. 324-4 of the Rural and Maritime Fishing Code. Their minimum share capital is 7,500 euros. The operating partners must collectively hold more than 50% of the shares representing the capital.

Forest Savings Companies (SEF) are collective investment companies aimed at promoting forest investment, with the primary purpose of acquiring and managing forest assets. They are governed by the provisions of the Monetary and Financial Code and the general regulations of the AMF. Like Real Estate Investment Companies (SCPI) and Forest Investment Groups (GFI), SEFs are authorized to make a public offering of their shares, even beyond an offer reserved for a limited circle of investors or qualified investors, in accordance with Article L. 214-86, paras. 2 and 4, of the Monetary and Financial Code. The assets of SEFs consist, on the one hand, of at least 60% forest assets and, on the other hand, of cash or equivalent values, in accordance with Article L. 214-121, para. 1, of the same code. The woods and forests they hold must be managed according to an approved simple management plan, in accordance with Articles L. 214-121, para. 2, and R. 214-166 of the same code, which must be approved by the general meeting of partners, pursuant to Article L. 214-125, para. 3. SEFs must have a minimum share capital of 760,000 euros and require the approval of their management company by the AMF, subject to certain adjustments.

The agricultural joint farming groups (GAEC)  fall under the regime defined by Articles L. 323-1 et seq. and R. 323-8 et seq. of the Rural and Maritime Fishing Code. Their purpose is either to enable joint work under conditions comparable to those in family-run farms or to jointly sell the products of the associates' work. Several rules aim to maintain the family nature of the farms and the predominance of work within the GAEC, such as the establishment of a limit of ten associates or the obligations for associates to participate in the joint work and to engage in their professional activity exclusively and full-time, etc. Furthermore, the GAEC must obtain the approval of the prefect of the department of their registered office, pursuant to Articles L. 323-11, para. 1, and R. 323-8 of the same code. In these groups, the affectio societatis is particularly important, so its disappearance necessarily compromises the operation of the farm . Moreover, since this corporate form does not tolerate functioning with a single associate, a clause in the statutes providing that associates have the possibility to request the court for the withdrawal of the applicant upon dissolution cannot apply when the group comprises only two associates .

Agricultural land groups (GFA)  are governed by Articles L. 322-1 et seq. of the Rural and Maritime Fishing Code. Composed solely of natural persons, their purpose is the leasing of agricultural property they own and/or the direct operation of such property, under certain conditions.

Forest groups fall under the regime of Articles L. 331-1 et seq. and R. 331-1 et seq. of the Forestry Code. Established for a maximum duration of 99 years, with the aim of promoting reforestation and the conservation of forest areas, they may engage in activities of constitution, improvement, equipment, conservation, or management of one or more forest areas and acquire woods and forests. Any operations that do not fall within the normal extension of the agricultural activity of forest groups and are likely to alter the civil nature of their corporate purpose are prohibited .

Forest Investment Groups (GFI), as referred to by the Monetary and Financial Code and the general regulations of the AMF, are forest groups "that raise capital from investors to invest it, in the interest of these investors and in accordance with an investment policy defined by the group or its management company" . GFIs are authorized to make a public offering of their shares, even if it is not limited to a restricted circle of investors or qualified investors. The woods and forests they own must be managed in accordance with a simple management plan approved under Article R. 214-166 of the Monetary and Financial Code, as referred by Article R. 214-176-2 of the same code. Their minimum share capital cannot be less than EUR 760,000 when they make a public offering other than one reserved for a restricted circle of investors or qualified investors, pursuant to Articles L. 214-88 and L. 214-86 of the same code.

Pastoral groups created for the exploitation of pastures, which may belong to them or be leased to them either by individual owners or by pastoral land associations, are governed by the provisions of Articles L. 113-3 to L. 113-5 and R. 113-1 to R. 113-12 of the Rural and Maritime Fishing Code. They are subject to the approval of the prefect. The pastoral group is established for a minimum duration of nine years. If a legal entity that does not pursue an agricultural purpose wishes to join, local agricultural operators must hold the majority of the share capital.

Finally, rural land groups (GFR), established to assemble and manage buildings for agricultural and forestry use, have a hybrid status, governed on the one hand by Articles L. 322-1 et seq. of the Rural and Maritime Fishing Code, and on the other hand by Articles L. 331-1 to L. 331-2 of the Forestry Code.

On these, See LACHAUD, Limited liability agricultural exploitation compared to other agricultural companies, Gaz. Pal. 1985, 2, doctr., 520; PILLEBOUT, Observations regarding limited liability agricultural exploitation, JCP N 1985, 9589; PREA, The single-member limited liability company and limited liability agricultural exploitation, JCP N 1985, 100964; DAVID, Present and future of limited liability agricultural exploitation, JCP N 1986, 100630; PILLEBOUT, About EARL. Lessons from the Poitiers symposium, JCP N 1986, 9811; VERIGNON, About limited liability agricultural exploitation, JCP N 1986, 100139; FOYER, Introduction to agricultural company law, RD rur. 2008, dossier 23; FOYER, Agricultural companies and commercial companies, RD rur. 2009, dossier 20; CERATI-GAUTHIER, Transfer of shares in limited liability agricultural exploitation. Special clauses, Dr. sociétés 2019, formule 4.

On these, BERMOND de VAULX, The agricultural joint farming group, RTD com. 1965, 787; MORIN, Agricultural joint farming groups, Rép. not. 1965, 1; POULAIN, Agricultural joint farming groups, Journ. not. 1965, 281; ROZIER, Agricultural joint farming groups, Litec, 1971; MALEZIEUX, Agricultural joint farming groups, Gaz. Pal. 1965, 1, 1976; PRETORIN, The GAEC, the agricultural joint farming group, RD rur. 1979, 3; d'HAUTEVILLE, The GAEC: a surprising evolution, RD rur. 1980, 15; LASSAUBATJEU, Agricultural joint farming group, Defrénois 1981, Art. 32786; PILLEBOUT, The formation of a GAEC, JCP N 1982, I, 85; DAVID, Observations on the GAEC father and son phenomenon, RD rur. 1985, 368; CHANDELLIER, GAECs at a turning point?, RD rur. 2008, study 29; BORDEAU, Transparency in GAECs: a diminished specificity within agricultural operating companies, RD rur. 2012, dossier 19; CHANDELLIER, The GAEC: 50 years and still new projects!, RD rur. 2012, dossier 29; CREVEL, GAEC and tenancy status, RD rur. 2012, dossier 17; FOYER, A brief historical introduction to the study of GAECs, RD rur. 2012, dossier 16; LEBEL, The GAEC, legal structure of an agricultural enterprise, RD. rur. 2012, dossier 18 and The GAEC, agricultural enterprise in difficulty or the delicate situation of GAEC partners, RD rur. 2012, dossier 32; MANTEAU, The GAEC and the couple, RD rur. 2012, dossier 30; ROUSSEL, The jubilee of GAECs (1962-2012), RD rur. 2012, landmark 7.

CA Bordeaux, 30 April 2024, LawLex202400003538JBJ.

On these, See BOBIN, Agricultural Land Groups, JCP N 1971, prat. 4935; CHESNE and MARTINE, Agricultural Laws of 31 December 1970: Long-term Rural Lease and Agricultural Land Group, D. 1971, législ., 248; LACHAUD, Agricultural Land Groups, Ann. loyers 1971, 1005; LASSAIGNE, Agricultural Land Groups, Defrénois 1971, Art. 29898, 785; MEGRET, Agricultural Land Groups, AJPI 1971, 323; POULAIN, Agricultural Land Groups, Journ. not. 1971, Art. 49959; RANDIER, Agricultural Land Groups: RD rur. 1971, 67; BOBIN, Agricultural Land Groups (Decree of 14 April 1972), JCP N 1972, prat. 5229; LACHAUD, Agricultural Land Groups (Decree of 14 April 1972), Ann. loyers 1972, 830; LASSAIGNE, Long-term Rural Leases and Agricultural Land Groups, Defrénois 1973, Art. 30344 and 30361; MEGRET, Agricultural Land Groups, AJPI 1973, 296; BOBIN, SAFER and Agricultural Land Groups, JCP N 1974, prat. 5815; CHESNE, SAFER's Intervention in Agricultural Land Groups, D. 1974, chron., 249; POULAIN, Agricultural Land Groups, Journ. not. 1974, Art. 52094; LASSAIGNE, Long-term Rural Leases and Agricultural Land Groups after the Law of 15 July 1975, Defrénois 1976, Art. 3174; MARTINE, The GFA, RD rur. 1980, 466; CHESNE and HERAIL, The GFA, Successional, JCP N 1983, I, 111.

Forest Code, Art. L. 331-1 et seq. and R. 331-1 et seq.

Company Law (en cours)

680. Plurality of structures(1)

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680. Plurality of structures(1)

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