FRANCE Law and Practice Contributed by: Antoine Mercier, Myriam Mejdoubi and Gabriel Dalarun, DLA Piper France LLP
5.3 REITs Listed real estate companies (sociétés d’investissement immobiliers côtées) are listed companies that benefit from a favourable tax regime. A company can become a SIIC if it com - plies with certain conditions, including: • a minimum share capital of EUR15 million; and • a principal corporate purpose relating to the acquisition or construction of buildings with a view to renting them, or the holding, directly or indirectly, of interests in entities with the same corporate purpose, the share capital or voting rights of which are not held to the extent of 60% or more by one or more per - sons acting in concert, and the share capital and voting rights of which are held, at the time of incorporation, to the extent of at least 15% by persons holding less than 2% of the share capital and voting rights each. SIICs are available to non-French investors. The SIIC and its nominated subsidiaries (which must have the same business purpose and be at least 95% owned, directly or indirectly) are exempt, upon SIIC election, from tax on renting or subletting of real estate under finance lease agreements, on capital gains arising from the disposal of real estate assets and on dividends received from SIIC subsidiaries, subject to distri - bution (ie, 95% of the rental income, 100% of the dividends received from nominated subsidiaries, and 70% of gains arising from the sale of real estate or shares in a SIIC subsidiary). 5.4 Minimum Capital Requirement The minimum capital required to set up each type of entity is as follows: • SCI – EUR1;
• SNC – EUR1; • SARL – EUR1; • SA – EUR37,000; • SAS – EUR1; • SCPI – EUR760,000 (each share must have a minimum face value of EUR150); and • SIIC – EUR15 million. 5.5 Applicable Governance Requirements The applicable governance requirements for these entities are as follows. SCI The company must be managed by at least one general manager, who may be an individual or a legal entity appointed in the by-laws (a statutory manager) or by the shareholders. SNC The partnership must be managed by at least one general manager, who may be an individual or a legal entity appointed in the by-laws (a stat - utory manager) or by the shareholders. SARL The company must be managed by at least one individual general manager, who may be named in the by-laws (a statutory manager) or prop - erly appointed subsequently. Additional general managers can also be named in the by-laws (statutory managers) or appointed by a decision of the shareholders. Only an individual is likely to be appointed as a manager. For the SCI, the SNC or the SARL, the general manager can be a shareholder or a third party. SA There are two possible structures for an SA.
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