If you’re thinking about international expansion, you might consider establishing a subsidiary. This process differs from country to country, but it’s usually a lengthy process no matter where you go. At Globalization Partners, we help you forgo the subsidiary process by hiring your employees through our in-country entity in Monaco.
How to Set Up a Monaco Subsidiary
When you set up a subsidiary, you need to consider the different business types and which one you’d like to be. In Monaco, the types are:
- Limited Liability: Non-citizens can only form this type of company with government approval. The minimum capital investment is €15,000.
- General Business Corporation: Known as Société Anonyme Monégasque (SAM), this type of company requires two shareholders and €150,000 capital investment. The entity must have at least two directors, and it’s legally tax-exempt if 75% of sales go to Monaco residents. Otherwise, they have a 33% corporate income tax.
- Limited partnership: This business type has both limited partners and general partners. Limited partners have limited liability, and they are not required to disclose information to the Trade and Industry Registrar. General partners have unlimited liability.
All companies must file with the Trade and Industry Registry. To register for a SAM, you need to publicize a series of documents in Journal de Monaco. These documents are:
- A ministerial decree approving your memorandum and articles of association.
- Memorandum and articles of association.
- Certification date, statement of subscription, and statement of paid capital.
For all other business types, you must submit your articles of association with the General Court Registry and publish it in the Journal de Monaco.
Monaco Subsidiary Laws
There are very few subsidiary laws to keep your entity legal within the country, and the requirements vary upon corporation type. You cannot establish a subsidiary without a registered office premise. Before you apply for your subsidiary, you should have a location.
You’re also legally required to have at least two directors and two shareholders for your entity, and none of them have to be residents. You need articles of association that detail how you will run your company and who has decision-making power within the subsidiary. You cannot legally run your business without tax registration.
When you set up your office, you have two months to complete your company registration.
Benefits of Setting Up a Monaco Subsidiary
Establishing your subsidiary requires both time and money. While you don’t need to be in the country to handle this process, it may be easier to interact with various agencies in person. Depending on the type of company you choose, registration could take anywhere from four to eight weeks. You’ll also need to wait for work permit approval, which takes about three months.
You need to consider your investment capital and if you can meet the legal minimums when you establish your entity. Registration comes with various expenses, including tax registration and bank account fees, and you may spend a few thousand euros.
Other Important Considerations
When you set up a subsidiary, you have an entity that runs separately from your parent company. This way, you have separate liability, and your subsidiary can form its own company culture. The board of directors can make creative decisions while still benefiting your business as a whole.
While owning a subsidiary has its advantages, it’s not always realistic for companies. The process can be long and expensive, and if you’re eager to start your expansion, it slows you down. With Globalization Partners, you run your company through our entity. The liability is on us, and you can focus on building your company.
Let Globalization Partners Help With Your Expansion
Get a jump start on your global expansion with Globalization Partners. Reach out to us today to learn more about our services.