Establishing a Company in Monaco

Why Incorporate in Monaco?

Monaco is one of the few jurisdictions in the world where personal income is not taxed. For business owners, this means that salaries and dividends drawn from a Monaco company are received net of personal income tax. The corporate tax (Impôt sur les Bénéfices — ISB) applies only to companies generating more than 25% of their turnover outside Monaco, at a rate of 25%.

Beyond the fiscal advantages, Monaco offers a prestigious business address, a stable political environment under the Grimaldi dynasty, excellent banking infrastructure, and proximity to the French Riviera's talent pool and logistics networks.

Company Structures Compared

Monaco recognises several legal forms of company. The three most common for international entrepreneurs are the SAM, SARL, and SCS.

SAM — Société Anonyme Monégasque

The SAM is Monaco's equivalent of a public limited company. It is the most prestigious and the most regulated structure, required for activities such as banking, insurance, and certain financial services.

With a minimum share capital of €150,000 (of which at least half must be paid up at incorporation), a board of at least three directors, and mandatory statutory auditors, the SAM is designed for significant enterprises or those requiring an institutional structure.

SARL — Société à Responsabilité Limitée

The SARL is by far the most popular structure for entrepreneurs and family offices. It combines limited liability with a simpler governance framework — requiring only one or more managers rather than a full board.

The minimum share capital is €15,000, and the number of partners is capped at 50. Shares cannot be freely transferred to third parties; existing partners have a right of first refusal, which provides useful control over the ownership structure.

SCS — Société en Commandite Simple

The SCS (limited partnership) is increasingly used for investment vehicles and holding structures. It features two categories of partners: general partners (commandités), who have unlimited liability and manage the company, and limited partners (commanditaires), whose liability is limited to their contribution.

The SCS offers considerable flexibility in profit distribution and management arrangements, making it attractive for family wealth structuring and private equity vehicles.

The Incorporation Process

Step 1: Government Authorisation

Unlike most jurisdictions, Monaco requires prior government approval before a company can be incorporated. The application is submitted to the Direction de l'Expansion Économique (Department of Economic Expansion) and must include a detailed business plan, proof of the founders' credentials, and evidence of the company's intended benefit to Monaco.

Step 2: Draft the Articles of Association

The statutes must be drafted in French and notarised by a Monaco notary. They define the company's purpose, governance, share structure, and rules for transfer of interests.

Step 3: Capital Deposit

The share capital must be deposited in a blocked account at a Monaco bank. A certificate of deposit is issued, which is required for registration.

Step 4: Registration

Once the notarial deed is executed, the company is registered with the RCI (Répertoire du Commerce et de l'Industrie), Monaco's commercial registry. Publication in the Journal de Monaco follows, completing the formal creation.

Ongoing Obligations

• Annual accounts — Companies must file annual financial statements with the RCI.
• ISB declaration — If subject to corporate tax, an annual return is required.
• Social charges — Employers pay social contributions of approximately 35–40% of gross salary for Monaco-based employees.
• Statutory audit — Required for SAMs and larger SARLs exceeding certain thresholds.