Monaco


Monaco was refounded in 1215 as a colony of Genoa when the Genoese built a fortress on the site of present-day Monaco. The current ruling Grimaldi family secured control in the late 13th century, and a principality was established in 1338. Economic development was spurred in the late 19th century with a railroad linkup to France and the opening of a casino. Since then, the principality's mild climate, splendid scenery, and gambling facilities have made Monaco world famous as a tourist and recreation center.

Service packages

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Service item Express Standard Optimum
Company registration
Legal address per year
Secretarial services for the first year
Fees and duties for the first year
Apostilled bound set of incorporation documents
Compliance fee
Nominee service per year
Bank Account Pre-approval
Price

20 000 USD

20 000 USD

20 500 USD

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Core Services

16 500 EUR

— Incorporation

including incorporation tax, state registry fee, including Compliance fee

Included

— Annual government fees

Stamp Duty and Trade and Industry Register incorporation fee

от 5 000 EUR

— Corporate legal services

including registered address and registered agent, NOT including Compliance fee

150 EUR

—Delivery of documents by courier mail

DHL or TNT, at cost of a Courier Service

500 EUR

— Apostilled set of Statutory documents

Optional services

Nominee Director

Paid-up “nominee director” set includes the following documents

Nominee Shareholder

Paid-up “nominee shareholder” set includes the following documents

Related services

Tax Certificate

Company’s tax residence certificate for access to double tax treaties network

Certificate of Good Standing

Document issued by a state agency in some countries (Registrar of companies) to confirm a current status of a body corporate. A company with such certificate is proved to be active and operating.

Compliance fee

Compliance fee is payable in the cases of: renewal of a company, liquidation of a company, transfer out of a company, issue of a power of attorney to a new attorney, change of director / shareholder / BO (except the change to a nominee director / shareholder)

250 USD

Basic

simple company structure with only 1 physical person

50 USD

For legal entity in structure under GSL administration

additional compliance fee for legal entity in structure under GSL administration (per 1 entity)

100 USD

For legal entity in structure not under GSL administration

additional compliance fee for legal entity in structure NOT under GSL administration (per 1 entity)

350 USD

For client with high risk Status

Cost of incorporation, including first year servicing 20000
Cost of annual service, starting from the second year 6060
Open account in 26812
Incorporation timescale for a turnkey company 3 months
Country 26715

General information shortly

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Total area Population Capital Unemployment Corruption perceptions index rank
2.02 sq. km 30.510 (2011) Monaco 2% (2012) no data
Location Western Europe
National currency Euro
Conditional reduction of currency EUR
Against USD 0.73
Climate, average max and min t° Mediterranean with mild, wet winters and hot, dry summers; avg. maximum temperature (July) +24°; avg. minimum temperature (January) +8°
Time difference from Moscow - 2 hours
Dialing code +377
State language French
Ethnic groups French 47%, Monegasque 16%, Italian 16%, other 21%
Literacy rate 99%
Government type Constitutional monarchy
Executive branch Council of Government
Legislative branch Prince and National Council
Judicial branch Supreme Court (Tribunal suprême), Court of Revision (Cour de révision), courts of first instance (Tribunal de première instance), justice of the peace (juge de paix)
GDP per capita rank 4 (2011)

Corporate info

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Shelf companies permitted Legal system Incorporation timescale for a turnkey company Cyrillic alphabet permitted in company name Local registered office
No civil law 3 months No Yes
Types of entity Limited Liability Company (Société à responsabilité limitée (SARL)); Joint Stock Company (Société Anonyme Monégasque (SAM)); General Partnership (Société en Nom Collectif (SNC)); Limited Partnership (Société en commandite simple (SCS)); Sole Trader
Incorporation timescale for a new company 3 months
Company suffix Societe a responsabilite limitee or S.A.R.L.
Sensitive words identical and offensive words
Local registered agent Yes
Information to be kept at the registered office all legal documents (articles of association), accounts and invoices/bills
Seal required, type of seal not required
Redomiciliation (to, from) permitted not permitted

Director and secretary

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Minimum number of directors Residency requirements for directors Corporate directors permitted Disclosure to local agent Disclosure to public
1 Yes No Yes Yes
Directors’ meetings/frequency/location No requirements
Company secretary required No
Residency requirements for a secretary No
Qualified secretary required No
Corporate secretary permitted No

Shareholder and beneficiary

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Minimum number of shareholders Residency requirements for shareholders Corporate shareholder permitted Disclosure to local agent Disclosure to public
2 No Yes Yes Yes
Meetings/frequency/location Yes / annually / no requirements
Beneficiary info disclosure to No

Shares and share capital

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Minimum authorized share capital Minimum issued share capital Minimum paid share capital Authorized capital payment deadlines Bearer shares permitted
15000 15000 15000 No requirements No
Issued capital payment deadlines Minimum amount - before incorporation, the rest - within 3 years
Standard currency Euro
Standard authorized share capital 15000
Standard par value of shares 1
Shares with no par value permitted No

Taxes

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Min. rate for corporate tax Capital gains tax VAT Withholding tax Exchange control
33.33% Regular rate 20% No No
Personal tax No
Corporate tax (in detail) The income tax rate is 33.33%
VAT. Details VAT is charged according to the rules established in France. The standard VAT rate is 20%. Reduced rates of 10%, 5% and 2.1% apply to some goods and services
Other taxes Social Contributions, Inheritance and Gift Tax
Government fee No
Stamp duty 0,5-7,5%

Accounts

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Requirement to file accounts Publicly accessible accounts Audit required Requirement to file Annual Return Publicly accessible Annual Return
Yes No No Yes No
Requirement to prepare accounts Yes
Double tax treaties network 8
Tax Exchange Information Agreement network 23
OECD member No
Offshore/onshore status according to the RF laws Yes

GENERAL INFORMATION

General Info

Monaco is a country in Western Europe bordering the Mediterranean Sea on the southern coast of France, near the border with Italy.
Total area of Monaco is 2.02 sq. km. Population of Monaco is 30.5100 (2011). Ethnic groups include

  • 47 % - French;
  • 16 % - Monegasque;
  • 16 % - Italian;
  • 21 % - other.

The capital of Monaco is Monaco.
The official language of Monaco is French.
The official currency is Euro (EUR). 1 USD is equal to 0.73 EUR.
The climate of Monaco is Mediterranean with mild, wet winters and hot, dry summers. The average maximum temperature in August is +27°C; average minimum temperature in January is +13°C. Time difference with Moscow is - 2 hours.
Literacy rate is 99%.
Calling code of Monaco is +377.

History

Monaco was refounded in 1215 as a colony of Genoa when the Genoese built a fortress on the site of present-day Monaco. The current ruling Grimaldi family secured control in the late 13th century, and a principality was established in 1338. Economic development was spurred in the late 19th century with a railroad linkup to France and the opening of a casino. Since then, the principality's mild climate, splendid scenery, and gambling facilities have made Monaco world famous as a tourist and recreation center.

Government Type

Monaco is a constitutional monarchy.
The head of state is the Prince.
Executive power is exercised by Council of Government under the authority of the monarch. Council of Government is headed by the Minister of State.
Legislative power is vested in is unicameral National Council or Conseil National (24 seats; 16 members elected by list majority system, 8 by proportional representation to serve five-year terms).
Judiciary power also belongs to the Prince. The main judicial authorities include Supreme Court (Tribunal suprême), Court of Revision (Cour de révision), courts of first instance (Tribunal de première instance), justice of the peace (juge de paix).

Economy

Monaco boasts the world's highest GDP nominal per capita at US$153,177. It also has an unemployment rate of 2%, with over 48,000 workers who commute from France and Italy each day. According to the CIA World Factbook, Monaco has the world's lowest poverty rate and the highest number of millionaires and billionaires per capita in the world. For the fourth year in a row, Monaco in 2012 had the world's most expensive real estate market, at $58,300 per square metre.
One of Monaco's main sources of income is tourism. Each year many foreigners are attracted to its casino (which citizens are prohibited from) and pleasant climate. It has also become a major banking center, holding over €100 billion worth of funds. The principality has successfully sought to diversify its economic base into services and small, high-value-added, non-polluting industries, such as cosmetics and biothermics.
Monaco is not a member of the European Union. However, it is very closely linked via a customs union with France and, as such, its currency is the same as that of France, the euro.

CORPORATE INFORMATION

Legal System

Monaco has a civil law system influenced by French legal tradition. Several fields of law are regulated by French laws.
Companies are regulated by Commercial Code, which is essentially similar to its French equivalent.

Types of Entity

The principal forms of business organization in Monaco are:

  • Limited Liability Company (Société à responsabilité limitée (SARL));
  • Joint Stock Company (Société Anonyme Monégasque (SAM));
  • General Partnership (Société en Nom Collectif (SNC));
  • Limited Partnership (Société en commandite simple (SCS));
  • Sole Trader

The most common structure is the company with limited liability (SARL).

Comparison of Types of Entity of Monaco
SARL SAM SNC SCS Sole Trader
Type of Entity Limited Liability Company (SARL) Joint Stock Company (SAM) General Partnership (SNC) Limited Partnership (SCS) Sole Trader
Company Name Preceded or followed by the initials "SARL"; May include the name(s) of one or more shareholders Preceded or followed by the words "société anonyme monégasque" or the initials "SAM" and a statement of the share capital; May include the name(s) of one or more shareholders Shareholders' names only Name(s) of one or more active shareholders Trading name only
Shareholders Minimum of 2, no maximum; Natural or legal persons; Managing Director: must be a natural person, may or may not be a shareholder; Neither shareholders or directors are considered as traders. Minimum of 2 shareholders, no maximum; No person may be a Member of the Board of more than 8 commercial firms having their registered office in Monaco Minimum of 2 shareholders, no maximum; Natural or legal persons; All considered as traders 2 types: active partners, considered as traders, and limited partners; Minimum of 2, 1 active partner and one limited partner, no maximum; Natural or legal persons A natural person
Activities Commercial Commercial or non-trading Commercial Commercial or non-trading Commercial or non-trading
Share capital EUR 15,000 minimum; Contributions in cash are paid into an account opened for this purpose with a credit institution established in the Principality, proof of which must be given when applying to be listed on the Trade and Industry Registry; Contributions in cash and in kind, contributions in skills or services not permitted; Contributions in kind must be fully paid up when the company is formed; Cash contributions must be paid up when the company is formed and at least equal to the minimum capital; The share capital must be fully paid up within 3 years EUR 15,000 minimum, fully paid up; Subscription and payment of capital is recorded in a notarised deed; All shareholders must make a contribution; Only the contributions in cash and in kind are taken into account in the share capital; Contributions in skills and services No minimum capital No minimum capital N/A
Liability Shareholders only bear losses up to the amount of their contributions Directors: only liable for the performance of the mandate that they have received. They do not contract, as a result of their management, to any personal or joint and several obligation in respect of the company’s undertakings; Shareholders’ liability is limited to the amount of their contributions All shareholders are indefinitely jointly and severally liable for company debts in respect of all their assets Active partners: indefinitely jointly and severally liable for company debts; Limited partners: liable up to the amount of their contributions Held liable in respect of all their assets
Company formed by Privately-signed or official deed; A transcript of the Memorandum and Articles of Association is published in the Journal de Monaco Official deed drawn up by a Monegasque notary; The Memorandum and Articles of Association are published in the Journal de Monaco; The Memorandum and Articles of Association approved by Ministerial Order are returned to the offices of the drafting notary. The authorization granted only produces its effects once the Memorandum and Articles of Association have been deposited in the official records of the drafting notary Privately-signed or official deed; A transcript of the Memorandum and Articles of Association is published in the Journal de Monaco Privately-signed or official deed; A transcript of the Memorandum and Articles of Association is published in the Journal de Monaco N/A
Additional Set-up costs Registration tax; Publication fees Registration tax; Publication fees; Notary's fees Registration tax; Publication fees Registration tax; Publication fees N/A

INCORPORATION

Company Name

  • Company name must be preceded or followed by the words Societe a responsabilite limitee or its abbreviation S.A.R.L.
  • It may contain the name of one or more partners.

SARL Registration

To incorporate a SARL in Monaco the following steps are required:

1. Apply for a business permit : Partners who wish to carry out certain business activities that require authorization (insurance, accounting, legal and financial activities, property, media, personal domestic services, health sector, food sector, cosmetics, transport, etc.), must make an application for permit to carry out a business activity and provide all supporting documents. Please note that a partner of foreign nationality always has to make an application for permit to carry out a business activity.

2. Make a declaration of intent to carry out a business activity: Documents to be provided:

  • The completed form “Application for permit to carry out a business activity in the Principality of Monaco”
  • Two original copies of the articles of association registered with the Department of Tax Services
  • A completed “Personal Information” form for each partner
  • A certificate of nationality or copy of ID card
  • A copy of the applicant’s criminal record, not more than three months old. This should be obtained from the General Court Registry of Monaco
  • The “Information on business premises” form
  • The deed of occupancy
  • In cases involving lease management: the contract or contract agreement
  • In cases involving the purchase of an existing business or of tenancy rights: the deed of transfer of business or of tenancy rights or the transfer agreement

3. Declare a business activity : The declaration of business activity including all supporting documents must be submitted to the Business Development Agency. It is returned with a receipt, dated and signed by the Minister of State, within two weeks from the date of submission of the declaration.

4. Draw up and sign Memorandum and Articles of Association: Memorandum and Articles of Association should contain the following information:

  • the company's legal form;
  • the number of shareholders;
  • the duration of SARL: the duration of a firm cannot exceed 99 years;
  • the company name ;
  • the registered office;
  • the company objects;
  • the amount of the share capital and a valuation of each contribution in kind;
  • allocation of shares among shareholders, and shares paid up;
  • the company year-end;
  • appointment of Managing Director(s);
  • the conditions under which the company is to be run;
  • resolutions to be taken by the shareholders at General Meetings;
  • procedures for calling and holding meetings and majorities required when passing resolutions.

5. Enter the company in the Register of Trade and Industry: Entry into this register follows submission of a copy of the articles of association to the General Court Registry and publication in the Journal de Monaco of an announcement of establishment. This is at the expense of the company by intermediary of the Business Development Agency. Entry into the register is subject to proof of payment of cash contributions forming the minimum share capital through submission of the certificate of deposit of funds from the credit institution with which an account was opened for this purpose.

6. Register on the NIS (Statistical Identification Number): Register with IMSEE (Monegasque Institute of Statistics and Economic Studies) This number is used for official classifications and statistics and is necessary throughout the life cycle of your company (opening a bank account, establishing a telephone line, etc.).

7. Declare existence of the company to the Department of Tax Services

8. Register the managers with the CAMTI-CARTI

It takes about 3 months to startup a new company in Monaco.

Local Registered Office

Each SARL must have a registered office in Monaco. The registered office of an SARL

  • can be established on commercial premises (commercial lease, short-term lease or temporary tenancy agreement);
  • can be domiciled at the Managing Director's personal address in Monaco for a duration of one year, that may be renewed once, as from publication in the Journal de Monaco of the transcript of the Memorandum of Association if no legislative, regulatory or contractual provision is opposed thereto; the firm's activities do not involve reception of clients or the storage or display of goods; the firm employs no staff;
  • can be either with a domiciliation company for a period limited to one year (may be renewed once) or on premises occupied by another firm.

Seal

There are no mandatory requirements regarding the company seal.

Redomicile

The redomiciliation of companies either to or from Monaco is not permitted.

COMPANY STRUCTURE

Directors

An SARL must be managed by one or more natural persons. A company cannot therefore be the Managing Director of an SARL (article 35-4 of the code de commerce).
The first Managing Director(s) are appointed by the shareholders in the Articles of Association and may be removed under the conditions laid down therein.

Powers of the Managing Director
  • The Managing Director may carry out any and all acts that are required or appropriate in fulfilling the company objects, subject to powers bestowed by law or the Articles of Association upon the shareholders.
  • If the Articles of Association have not limited his/her powers, the Managing Director may thus carry out any and all acts of management insofar as the latter are related to the activities of the SARL and are in line with the firm's interests.
  • The Managing Director may, in the name of the firm and in line with the company objects, sign contracts and agreements, hire staff, take legal action, etc.

The Managing Director's powers can be limited by:
  • The Articles of Association: some clauses in the Articles of Association may render certain acts subject to prior authorization by the body of shareholders
  • The powers bestowed upon shareholders by the law: the company's legal representative cannot take any action that is solely incumbant upon the shareholders, such as amendments to the Articles of Association or transfers of goodwill leading to the liquidation of the firm.

Among the Managing Director's obligations are holding meetings:

  • Ordinary General Meetings (OGMs) and
  • Extraordinary General Meetings (EGMs).

Shareholders

SARL in Monaco should have at least 2 shareholders. Shareholders can be natural persons and legal entities. Resident and non-resident shareholders are allowed.
Shareholder names are filed on the public register.
Shareholders should participate in annual ordinary general meetings. The annual accounts must be approved by the OGM.

Secretary

Monegasque SARL is not required to appoint a company secretary.

Beneficiary

Beneficiaries’ details do not appear on a public profile. The identity of the beneficial owner of a Monegasque company is treated as strictly confidential and must be disclosed as part of the obligatory due diligence to service providers including firms specializing in company formation, trust managers, lawyers, and accountants, as well as to the auditor. It can only be disclosed by them in the cases stipulated by law and following statutory procedure.

Share Capital and Shares

The share capital of the SARL is at least 15,000 Euro.
It must be fully paid up. This means that the amount of share capital defined in the Memorandum and Articles of Association of the firm must correspond to the founders' total undertakings. When the company is formed, cash contributions must be fully paid up, amounting to the minimum required share capital. Additional amounts must be paid up within three years of incorporation, subject to the share capital being reduced at the request of any interested party.
When application for registration is made to the Trade and Industry Registry, effective payment of cash contributions forming the minimum share capital is checked by means of submission of a certificate of deposit of funds, issued by the credit institution with whom an account has been opened for this purpose.
Bearer shares are prohibited.

TAXATION

Personal Income Tax

Monaco does not levy personal income tax. However, French citizens residing in Monaco, with some exceptions, must pay French income tax.

Corporate Income Tax

Monaco has a territorial system of taxation. The tax base is defined as the company's worldwide income generated (or deemed to be generated) in Monaco.
The corporate income tax rate is 33.33%.
Not all companies pay corporate income tax.
This tax is paid by:
  • Enterprises, irrespective of their legal form, that carry out industrial or commercial activities in Monaco, if at least 25% of their revenue arises from operations carried out directly or indirectly outside Monaco; and
  • Companies (societes) whose activity in Monaco consists of collecting revenue from:
  • - Selling or licensing patents, trademarks, manufacturing processes and formulas, or
  • - Literary or artistic copyrights.

When determining the revenue from foreign activities, the following is taken into account:
  • Sale of goods abroad or sale of goods intended for export (regardless of whether the goods are delivered in Monaco or abroad). Retail cash sales and sales of real estate located in Monaco are not taken into account.
  • Provision of services, if the services are provided, the rights are sold or the rented goods are used outside Monaco.

Operations carried out abroad through a permanent establishment, dependent agent, or forming a full commercial cycle abroad are not taxed in Monaco (since Monaco uses a territorial principle of taxation), but are taken into account when determining the turnover from operations outside Monaco. The management/service activities of the headquarters of international groups of companies, although do not qualify as industrial or commercial activities, may be taxed in Monaco in respect of the contribution of the headquarters to the general turnover of the group, determined according to special rules.
Received dividends can be exempt from tax. The exemption depends on the size of the equity holding in the company distributing the dividend.

CFC Rules

There are no CFC rules.

Withholding Tax

Monaco does not levy withholding tax.

VAT

VAT is charged according to the French VAT rules.
The standard VAT rate is 20%.
Some goods and services are subject to the reduced rates of 10%, 5% and 2.1%.

Social Security Contributions

Social security contributions are payable by employers at the rates from 28% to 40% and by employees at the rates from 10% to 14%. There are salary ceilings for the assessment of contributions.

Inheritance and Gift Tax

Inheritance and gift tax is levied at the rates from 0% to 16% depending on the degree of relationship between the parties.

Stamp Duty

Stamp duty is levied on documents used for civil and legal purposes and on documents required as legal proof in court.
Stamp duty is either applied at a fixed rate, or according to the size of paper used.

Double Tax Agreements

Monaco has exchange of information relationships with 29 jurisdictions through:

8 DTСs: Guernsey, France, Luxembourg, Mali, Mauritius, Qatar, Saint Kitts and Nevis, Seychelles;
23 TIEAs: Andorra, Argentina, Australia, Austria, Bahamas, Belgium, Czech Republic, Denmark, Faroe Islands, Finland, Germany, Greenland, Iceland, India, Italy, Liechtenstein, Netherlands, Norway, Samoa, San Marino, South Africa, Sweden, United States.

Exchange Control

There is no exchange control in Monaco.

ACCOUNTS

Financial Statements

It is mandatory to file accounts annually with the Repertoire de Commerce (commercial registry), within nine months of the end of an accounting period. Accounts must be filed with the tax authorities within three months of the end of an accounting period.
These financial statements are not available to the public.

Annual Return

There is a statutory requirement for SARLs to prepare and file annual return.

Tax Returns

The tax year coincides with the financial year of the company.
The tax return is filed within 3 months of company's financial year-end.
Four advance corporate income tax payments are made during the year, with final payment at the end of the financial year.

International law relations

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Party to the Hague Convention (Apostille) Legal system Double tax treaties network OECD member Offshore/onshore status according to the RF laws
Yes civil law 8 No Yes

Public authorities and legal acts

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List of laws and regulations
Act name Scope of law
Commercial code companies
Tax code taxation
Tax treaties entered Guernsey, France, Luxembourg, Mali, Mauritius, Qatar, Saint Kitts and Nevis, Seychelles
Tax Exchange Information Agreement (TEIA) Andorra, Argentina, Australia, Austria, Bahamas, Belgium, Czech Republic, Denmark, Faroe Islands, Finland, Germany, Greenland, Iceland, India, Italy, Liechtenstein, Netherlands, Norway, Samoa, San Marino, South Africa, Sweden, United States
List of state regulatory authorities
Monaco Government http://en.gouv.mc/Portail-du-Gouvernement
Public Services of Monaco Government http://en.service-public-entreprises.gouv.mc/Public-Services-for-Businesses
Monaco Trade and Industry Register http://www.rci.gouv.mc/rc/
Journal de Monaco http://journaldemonaco.gouv.mc/
Monaco Bar http://www.avocats.mc/e/index.html

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    Regards, GSL Law & Consulting Lawyer, Head of UK GSL office Aniko Sebok

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    Regards, GSL Law & Consulting Lawyer, London Office Valerija Filipova

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