Company and tax law

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

The Commercial Code (Code de commerce) contains, in its First Book / Fourth Title, around thirty provisions applicable in company law. Additionally, among others, the provisions of the Ordinance of 5 March 1895 on public companies and limited partnerships by shares completed by Law No..408 of 20 January 1945 and Law No. 1.331 of 8 January 2007 are applicable.

Law no. 1.573 of 8 April 2025 introduced a comprehensive reform of company law in order to modernise it. It created two new types of Monegasque company: the single-member limited liability company (SURL) and the non-trading company of means (société civile de moyens). The rules governing Monegasque public limited companies and limited partnerships with share capital have been recast in Title III of Law no. 1.573 (repeal of the aforementioned Sovereign Ordinance of 5 March 1895 and the related provisions of the Commercial Code). In addition to recasting the existing rules (authorisation, formation, governance, share capital), Law no. 1.573 created a conciliation procedure designed to avoid the cessation of payments and the opening of collective proceedings through an amicable settlement mechanism (numerous amendments to the Commercial Code and of the Civil Code).

There are five types of commercial companies in the Principality:

• Société à Responsabilité Limitée (SARL) (private limited company) formed by at least two partners (natural or legal persons), the liability of the partners being limited to the amount of their contributions. The minimum amount of share capital is €15,000. The activity carried out must be commercial, but commercial capacity is not required. Liberal, civil, financial and insurance activities (except insurance brokerage) cannot be carried out via an SARL. The articles of association of the limited liability company may be drawn up by private deed, except if the share capital consists, in whole or in part, of real estate subject to land registration, in which case a notarial deed is required.
• Société Unipersonnelle à Responsabilité Limitée (SURL) (single-member private limited company) created by Law No. 1.573 of 8 April 2025, consisting of a sole partner (natural or legal person). The liability of the sole partner is limited to the amount of the contribution. It allows for the separation of professional and personal assets. The minimum share capital is €8,000 when the sole partner is a natural person, or €15,000 when the sole partner is a legal entity. The articles of association may be drawn up by private deed, unless the share capital consists, in whole or in part, of real estate subject to land registration, in which case a notarised deed is mandatory.
• Société Anonyme Monégasque (SAM) (public limited / joint stock company) formed by at least two shareholders (natural or legal persons), the liability of the shareholders being limited to the amount of their contributions. The company's object may be either commercial (commercial capacity is not required) or civil (the exercise of a liberal activity via a SAM with a civil object is possible). In principle, the minimum amount of share capital is €150,000 (but may be higher for certain activities such as financial activities). The articles of association of the SAM may be drawn up by notarial deed, or (as newly provided for by Law No. 1.573 of 8 April 2025) by private deed.
• Société en Commandite Simple (SCS) (active and limited partnership) formed by at least two partners, a general partner (a natural or legal person who is a trader and is indefinitely and jointly and severally liable for all of the company's debts) and a limited partner (who is not a trader and is only liable for the amount of his contribution) The object of the company may be commercial or non-commercial. The minimum amount of share capital is freely determined. The articles of association of the SCS may be drawn up by private deed, except if the share capital consists, in whole or in part, of real estate subject to land registration, in which case a notarial deed is required.
  
• Société en Nom Collectif (SNC) (general partnership) formed by at least two partners (natural or legal persons), the partners being indefinitely and jointly and severally liable on their personal assets for the debts of the company. The activity carried out must be commercial and commercial capacity is required. Liberal or civil activities cannot be carried out via an SNC. This legal form is mandatory for certain professions such as pharmacy. The minimum amount of share capital is freely determined. The articles of association of the SNC may be drawn up by private deed, unless the share capital consists, in whole or in part, of real estate subject to land registration, in which case a notarial deed is required.

The possibility of individual practice must also be mentioned. The Entreprise en Nom Personnel (sole trader), which is not subject to the constraints of company formation, is open to natural persons wishing to carry out a commercial activity (commercial capacity required), a professional activity or a craft activity (persons whose personal or professional status prohibits them from carrying out commercial acts on a professional basis cannot carry out activities under this legal form). The entrepreneur's personal assets are not protected from the risks inherent in his activity.

One of the main features of Monegasque company law is that (except for persons of Monegasque nationality) the exercise of any commercial, craft, industrial or liberal activity in the Principality of Monaco is subject to the prior authorisation of the Minister of State, whether the activity is exercised in a personal capacity or in a company. No economic activity may be carried out in the Principality without this prior authorisation.

Only a Société civile (non-trading companies) that do not have a commercial activity (management of real estate assets, pooling of resources for the exercise of a profession, management of a portfolio of securities on its own account) is exempt from this prior authorisation. The partners (natural or legal persons) are indefinitely liable for the company's debts to third parties in proportion to their share in the company's capital on the date of payment. The articles of association may be drawn up by private deed or by notarial deed. In addition to the Société Civile Particulière (SCP) (Special Civil Company), Law No. 1.573 of 8 April 2025 created the Société Civile de Moyens (CSM) (Civil Company of Means), a structure intended for the liberal professions.

Certain regulated activities may also require specific authorisation (banking and financial activities, real estate, legal and accounting activities, etc.).

Monegasque tax law presents a couple of specificities, e.g. no income tax for individuals in Monaco, no property tax and no residency tax.

The profit tax (ISB "impôt sur les bénéfices"), together with the value added tax (VAT), form the basis of the Monegasque tax system.

The Franco-Monegasque Tax Convention of 18 May 1963 instituted the Monegasque ISB which is established and collected under the same conditions as French corporation tax. ISB is, in principle, only due by companies who make more than 25 % of their turnover outside of Monaco. The collection by a company of proceeds from patents and copyrights is also subject to the ISB. The tax rate has been gradually reduced since 1 January 2019: from 33.33% before 1 January 2019, it has been reduced to 31% as of 1 January 2019, to 28% as of 1 January 2020, to 26.5% as of 1 January 2021, and finally 25% as of 1 January 2022.

The Convention also provides that VAT is levied on the same basis and at the same rates as in France. Monaco thus transcribes each year in the Code of Taxes and Turnover ("Code des taxes et du chiffre d'affaires") the provisions of the French Finance Law concerning VAT. The standard rate is 20%, the reduced rate is 10%, and 5.5% for basic necessities. Sales of new buildings are subject to real estate VAT.

Excise duties (alcoholic beverages, tobacco products, energy products) are based on those in force in France, as are duties and taxes on beverages and precious metals.

Other duties and taxes are applicable in the Principality. For example, inheritance or donation tax applies to property located in the Principality or based there (subject to the provisions of the Franco-Monegasque Convention of 1 April 1950). Registration duties are levied at the time of the registration of deeds (deeds of transfer of businesses, leases, notarial, judicial and extra-judicial deeds, declaration of inheritance, deeds concerning civil companies, deeds of sale of boats), on transfers of property and real estate rights. Stamp duties are payable on the occasion of, among others, the completion of administrative formalities.

NOTE:

• from 1 October 2023, increase in the amount of fixed registration duties (to which deeds increasing the share capital are now subject), proportional duties (with a distinction based on the transparency or opacity of the entity), proportional duties (transfer of property and property rights), exemption of only half of the registration duties applicable to property transactions subject to VAT.
• from 1 January 2024, application of a "tourist contribution".

Regarding the international administrative assistance in tax matters, Monaco conducts the automatic exchange of information relating to financial accounts in accordance with the OECD Common Reporting Standard (CRS):

• 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) and a Party to the Multilateral Agreement between Competent Authorities on the Exchange of Country-by-Country Declarations concerning multinational enterprise groups (Action 13).

In addition to the Franco-Monegasque agreements (above-mentioned Tax Convention of 18 May 1963 and Amendments of 25 June 1969 and 26 May 2003, Exchange of letters of 6 August 1971 modifying the rules for sharing the recovery of turnover taxes; above-mentioned Convention of 1 April 1950 on the avoidance of double taxation and the codification of rules of assistance in inheritance matters; Customs and Tax Protocol of 23 December 1951; Agreement in the form of an exchange of letters of 18 July 1977 on the introduction of a flat-rate tax of 4% on the sale of precious metals; Agreement of 25 February 2019 on the tax treatment of gifts and legacies made to public persons and non-profit organisations), Monaco has also concluded bilateral tax treaties or agreements on the exchange of information in tax matters with the following other countries Andorra, Argentina, Australia, Austria, Bahamas, Czech Republic, Denmark, Finland, Greenland, Faroe Islands, Guernsey, Iceland, India, Italy, Liechtenstein, Luxembourg, Mali, Malta, Mauritius, Montenegro, Netherlands, Norway, Qatar, San Marino, Samoa, South Africa, Seychelles, Sweden, United Kingdom, United States.

• Since Law No. 1.439 of 2 December 2016, Monegasque public limited companies ("société anonyme") have been eligible for multi-family office status.
• Law No. 1.492 of 8 July 2020 introduced the obligation to open an account in a credit institution in Monaco for any public limited company, general partnership, limited partnership with shares or limited liability company (exclusively intended for the exercise of its professional activity). At the same time, it introduced a right to a bank account for legal persons domiciled in Monaco (having their registered office in the Principality within the meaning of Article 2 of the Code of Private International Law) who would not have a deposit account.
• Law No. 1.491 of 23 June 2020 opened up the possibility for legal entities registered in Monaco to submit an "offre de jetons"(Security Token Offering – STO, Initial Coin Offering – ICO) 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.
  
• Since its amendment by Sovereign Ordinance No. 8.372 of 26 November 2020, Ordinance No. 8.566 of 28 March 1986 on residence certificates specifically governs requests for the issue of a residence certificate "to fulfil a formality of a fiscal nature", in particular in the context of the automatic exchange of tax information on financial accounts. Furthermore, it now defines the notions of "principal or habitual residence" and "principal centre of activities".
• Law No. 1.528 of 7 February 2022 provides for the regulation of digital asset services and crypto-asset services with an authorisation regime for companies registered in Monaco, and has introduced the dematerialised tax stamp.
• Law No. 1.529 of 29 July 2022 on various economic and legal provisions, has : extended from 5 to 10 years the duration of pledges ('"nantissement") of motor vehicles, goodwill and capital goods and of the act of subrogation in the benefit of the pledge of capital goods, as well as the duration of retention of the privilege; introduced the assignment of professional receivables; remedied the hypothesis of vacancy of the position of foreign manager of the limited liability company in case of death, default or departure by allowing an authorised partner of the company to hold the position of manager during a transitional period; strengthened the effectiveness of the measures applicable in case of failure to communicate the accounting documents of public limited companies and limited partnerships with shares, and commercial companies other than joint stock companies.
• Law No. 1.537 of 9 December 2022 made the principal activity of domiciliation subject to the anti-money laundering and terrorist financing provisions of Law No. 1.362.
• Law no. 1050 (Part II) of 10 August 2023 and Law no. 1.559 of 29 February 2024 (PARTIE IV) strengthened the transparency requirements for legal entities (commercial companies, non-trading companies, foundations, associations and federations of associations): more "basic information" (to be declared) included in the Registers, increased access to the Register and control (Economic Development Department or Ministry of the Interior), more dissuasive penalties, etc.
• Law no. 1.560 of 2 July 2024 overhauled the tax benefits available to property dealers, subject to certain conditions.
• Law No. 1.573 of 8 April 2025, first phase of the modernisation of company law.

• Bill no. 1039 tabled on 27 May 2021 provides for the use of a digital recording device on a shared register (covering the main features of Blockchain technology) by public limited companies and limited liability companies to keep the register of transfers, record registered securities issued (public limited companies)..., the distribution of shares (limited liability companies)..., the sharing of information, a provision in the articles of association, the use of smart contracts.
  
• Bill No. 1112 amending various provisions relating to chartered accountancy, statutory auditing and company accounts, received by Parliament on 25 July 2025, second phase of the modernisation of company law.