A European Company or Societas Europaea (SE) is a European Public Limited Liability Company and can be formed in any member state of the European Economic Area (EEA). An SE can operate throughout the EEA on the basis of a single set of rules and a unified management and reporting system, avoiding the need to set up a costly and time-consuming network of subsidiaries governed by different national laws. An SE is governed in accordance with the law of the member state in which it has its registered office.
An SE can be formed in a number of ways:
- the merger of two or more PLCs (including SEs) with a presence in different Member States
- as a holding SE with two or more private or public limited companies (including SEs) proposing the formation. At least two of the companies must have a presence in different Member States and must become majority-owned by the SE
- as a subsidiary SE with two or more private or public limited companies (including SEs) proposing the formation. The companies must have a presence in different Member States
- as a subsidiary SE formed by an existing SE
- the transformation of an existing PLC into an SE. The PLC must for 2 years have had a subsidiary company governed by the laws of another Member State.
SEs registered in the UK are subject to many of the regulations that apply to UK PLCs including (but not limited to): requirements to have share capital and shareholders; for a minimum equivalent to at least €120,000 (of which at least £50,000 is denominated in sterling or €57,00 in euros); any allotted shares must be paid up to at least ¼ of their nominal value and the whole of any premium (except as part of an employees’ share scheme); requirements to complete Annual Confirmation Statement (formerly Annual Returns) and submit accounts.
To incorporate your European Company, we will:
- ensure the company or group of companies involved in the formation of the SE meet the requirements in terms of having presence in different EEA member states
- provide guidance on any merger or reverse takeover that is to take place
- check if the name you have chosen for your company is available and in line with company name rules
- prepare company registration forms, Statutes, Statement of Capital and Initial Shareholdings and statutory registers, using our own customised Model Articles
- file the documents and pay the required fees at Companies House
- provide legal advice on the issues related to your company formation, obligations and duties of the members
- forward the Certificate of Incorporation, statutory registers and the Memorandum and Articles of Association to your registered office address
There are also directives for the management of SEs, which are either through a one-tier system by an administrative organ or in a two tier system by a management organ and a separate supervisory organ.
In the light of recent events, people considering incorporation of SEs should take account of the possible effects of Brexit. There are approximately only 40 SEs with their registered office in the UK, but in the event of a Brexit, it would seem likely that there would need to be negotiation for these entities to convert into a UK company or for them to restructure themselves so that their registered office moves to an EEA Member State.
If you would like more information on the formation of a European Company please contact us.