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European company - legal form

The 'European company' (Societas Europeae - SE) is a legal form that you can consider for your own business.

The potential advantages are easier and cheaper expansion and management of cross-border operations without having to set up a network of subsidiaries.

How to form a ‘European company’?

There are 4 possibilities, depending on your situation:

  • merger - for public limited companies from at least 2 different EU countries
  • forming a holding company - for public and private limited companies with registered offices in different EU countries or which have had subsidiaries/branches in EU countries other than the country where they are registered for at least 2 years
  • joint subsidiary - same conditions as for the holding company (see above)
  • simple conversion from a public limited company - if it has a registered office in one EU country and has had a subsidiary in a different EU country for at least 2 years.

Features of European companies

  • Legal form - public limited-liability company
  • Has legal personality
  • Capital - minimum €120,000 - must be divided into shares
  • Its registered and head office must be in the same country. Winding-up, liquidation, insolvency are governed by the laws of that country.

Requirements may vary between countries. Some countries may have higher capital requirements, others require head office and the registered office to be in the same place.

You can transfer your registered office from one EU country to another without dissolving your existing company and creating a new one. But if you want to transfer your registered office outside the EU, you must wind up your company.

How to transfer your registered office

You will need to write a transfer proposal and publish it in the Official Journal of the EU. The country from which you want to transfer your registered and head office then has 2 months to oppose your proposal (for a limited number of reasons), so your transfer can't take effect until after that period.

The law of the EU country from which you moved will continue to apply to all actions your company took before the transfer.

Employee involvement - prerequisite for registration

To register your European company, you must reach agreement with your employees on how they will be involved in supervising your company’s activities. Employee involvement can take several forms:

  • employees can be represented in the management board
  • they can be represented by a separate body
  • you can agree with your employees on a different model.
You must provide the representatives of your employees with office space and financial support so they can perform their tasks.

If your European company is the result of a merger, you can still register it, even if your negotiations with employees do not end in an agreement. This also applies when the employees of the merging companies had no right of participation before the merger.

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