Company and tax law

The law firm GIACCARDI & BREZZO Avocats ensures the legal follow-up of commercial companies and structures of wealth management (civil societies, family offices):

• Legal Audits

• Legal acts to support the implementation of projects

• Creation of (multi) family office

• Creation, transfer of company, sale of business assets

• Organization and formalization of the relations between partners and company executives

• Restructuring operations (M&A, mergers, contributions, etc.)

• Dissolution, liquidation of companies

• Legal follow-up of companies, legal secretariat

• Company tax advice (in collaboration with foreign partners if necessary)

• Preparation of tax returns (in collaboration with accounting firms)

• Management of relations and litigation with the tax administration

• Compliance with AML/FT-C regulations

• Support for submitting an offre de jetons  (Security Token Offering – STO, Initial Coin Offering – ICO)

Monegasque company and tax law 

Contrary to France, few texts govern Monegasque company law, which allows for flexibility and contractual freedom.

The Commercial Code contains, in its fourth title, around thirty provisions applicable in company law. Additionally, among others, the provisions of the Ordinance of March 5, 1895 on public companies and limited partnerships by shares completed by the laws No.408 of January 20, 1945 and No. 1.331 of January 8, 2007 are applicable.

There are five types of vehicles in the Principality of Monaco (“société anonyme“, “société à responsabilité limitée“, “sociétés en commandite“, “société en nom collectif“). It is also possible to practice individually. A reform of company law is currently being prepared. In this context, Bill No. 1050, tabled in Parliament on 6 December 2021, envisages the creation of a special civil society for health, which would allow regulated professionals practising in the field of human health or veterinary medicine a new possibility of exercising within a more efficient structure in order to reduce costs by sharing resources such as premises, working materials and administrative staff.

One of the key characteristics of Monegasque company law is that all commercial activities are subject to the government’s prior authorisation. No company can be constituted in the Principality without Monaco’s government approval. Only non-trading companies are not subject to this prior authorisation system.

Since the law n ° 1.439 of December 2nd, 2016, Monegasque public companies can claim the quality of multifamily office.

Among the recent reforms, it should be noted that Law No. 1.492 of 8 July 2020 provides for the obligation to open an account in a credit institution in Monaco for any public limited company, general partnership, limited partnership, limited partnership with shares or limited liability company [société anonyme, société en nom collectif, société en commandite simple, société en commandite par actions, société à responsabilité limitée] (exclusively for the exercise of its professional activity).

At the same time, it has introduced a right to a bank account for legal entities domiciled in Monaco (having their registered office in the Principality within the meaning of Article 2 of the Code of Private International Law) that do not have a deposit account.

Law No. 1.491 of 23 June 2020 relating to offre de jetons (Security Token Offering – STO, Initial Coin Offering – ICO) opens up the possibility for legal entities registered in Monaco to submit an offre de jetons to the Minister of State, who issues prior administrative authorisation in the form of a label (a company in the process of being formed in Monaco may nevertheless submit an application for a label).  STOs are reserved for joint stock companies.

Furthermore, Law No. 1.492 allows any legal entity holding the authorisation to make an offre de jetons (ICO/STO) to benefit from the right to open a deposit account specifically dedicated to this offer, even if it already holds such an account for the needs linked to its constitution or the exercise of its professional activity.

In May 2021, Bill No. 1039 was tabled in Parliament, which envisages the use of a digital registration device on a shared registry (covering the main features of Blockchain technology) by joint stock companies and limited liability companies.

Monegasque tax law presents a couple of specificities, e.g. no income tax for individuals in Monaco, no property tax and no residency tax. Corporate income tax is, in principle, only due by companies who make more than 25 % of their turnover outside of Monaco.

In contrast, the VAT rules are very similar to the French rules pursuant to the Agreement between France and Monaco of May 18, 1963.

As regards natural persons, it should be noted that Order 8.566 of 28 March 1986 on residence certificates (amended by Sovereign Order 8. 372 of 26 November 2020) specifically governs requests for the issue of a residence certificate (made to the Public Security Department) “to fulfil a Monegasque administrative formality”, or “to fulfil a formality of a fiscal nature, in particular in the context of the reporting obligations introduced by Sovereign Order 6.208 of 20 December 2016” (automatic exchange of information in tax matters on financial accounts). Furthermore, it defines the notions of “principal or usual residence” and “principal centre of activities”.

Regarding the international tax cooperation, Monaco conducts the automatic exchange of information relating to financial accounts in accordance with the OECD Common Reporting Standard (with the Member States of the European Union, in the framework of the Amending Protocol of the Agreement with the European Community providing for measures equivalent to those contained in Directive 2003/48 / EC; with other third States subject to declaration, in the framework of the Convention on Mutual Administrative Assistance in Tax Matters and the Multilateral Agreement between Competent Authorities).

The Principality is also a member of the Inclusive Framework on BEPS (Base Erosion and Profit Shifting). Sovereign Ordinance No. 6.713 of 14 December 2017 implements the Multilateral Agreement between Competent Authorities on the Exchange of Country-by-Country Reporting of Multinational Enterprise Groups (Action 13).

It should be noted that the anti-money laundering and financing of terrorism legislation introduced the Registry of beneficial owners and the Registry of trusts in 2020.