What is a Société Anonyme (S.A.)?
The French word for a public limited corporation (PLC) is Société Anonyme (S.A.), which has several international counterparts. In the United States, an S.A. is the same as a corporation; in the United Kingdom, it is a public limited company; and in Germany, it is an Aktiengesellschaft (A.G.).
A special kind of corporate structure known as an S.A. makes a corporation a legitimate entity with the ability to possess and transfer property, engage in contracts, and be held accountable for criminal activity. Its main advantages include limiting the owners’ accountability for the company’s deeds and guaranteeing the moral entity’s survival independent of the lives of the founders, owners, or shareholders.
Understanding the Société Anonyme
Comparable corporate structures exist in several languages and nations, including the société anonyme. Because a company called S.A. always shields its founders’ assets from creditors’ claims, it encourages more people to launch businesses because it lowers risk.
If a firm chooses to go public, the S.A. structure facilitates meeting the capital-funding demands of developing businesses by allowing several investors to contribute varying amounts of money as shareholders. Thus, the S.A. is essential to a healthy capitalist economy.
Establishing the firm as a legal entity via the société anonyme reduces the owners’ accountability for the company’s acts, which is one of its main advantages.
The Société Anonyme’s (S.A.) history
The French government implemented the laws about establishing and composing a société anonyme on January 1, 1808, as part of the nation’s new commerce legislation. Preventing the wild speculation that had shaken the French markets before and during the French Revolution was one of the goals of these new laws. The code recognized three different types of corporate organizations: société en nom collectif, société en commandite, and société anonyme.
A société en nom collectif is an ordinary partnership where all partners actively participate in the business, all partners have unlimited responsibility, and any partner may act on behalf of the others.
In contrast, restricted partners—also called sleeping or quiet partners—and active partners comprise the société en commandite. While the active partners are in charge of all managerial responsibilities and have unlimited responsibility, the limited partners provide the company with assets or funds and have limited liability.
What a Société Anonyme (S.A.) Must Have
Compared to a sole proprietorship or partnership, an S.A. is subject to various tax laws and different accounting and auditing obligations in the case of a public S.A. Furthermore, some conditions must be fulfilled for a société anonyme to be recognized. Most S.A.s must submit articles of formation, have a board of directors, a managing director or management board, a supervisory board, a statutory auditor and deputy, a distinctive name, and a minimum amount of capital. However, these criteria differ by nation. Typically, it lasts a maximum of 99 years.
For instance, an S.A. in Luxembourg has to have two partners and be financed with a minimum of €30,000, of which 25% must be contributed during the formation procedure. In Luxembourg, an S.A. must also pay statutory auditor fees, notary fees, and the cost of registering with other regulatory bodies. Prominent corporations formed as S.A.s include Nestlé, Anheuser-Busch InBev, and L’Oréal.Four Société Anonyme (S.A.) Examples
The société anonyme structure is used in a large number of different nations and languages. A few instances are:
- Brazil: Anônima Sociedade
- Denmark: A/S Aktieselskab
- Public Limited (LTD.) in India
- Perseroan Terbatas Terbuka (P.T. Tbk.) in Indonesia
- Japan: K.K. Kabushiki Gaisha
- Jusighoesa (J) in Korea
- Malaysia: Bhd, or Berhad
- The Netherlands: N.V., or Nammloze Vennootschap
- Aksjeselskap (AS) in Norway
- Poland: Akcyjna Spólka
- Aktiebolag (AB) in Sweden
Conclusion
- The co-French term for a company structure comparable to a corporation in the U.S. or a public limited company in the U.K. is société anonyme.
- The société anonyme was one of the numerous policies put in place by the French government in 1808 to improve the country’s trade structure and stop the wild speculation that had caused a cycle of booms and busts.
- A société anonyme has the advantage of reducing risk and shielding the owner’s assets from lawsuits from creditors.
