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Removal of managers (“gérants”) from a French General Partnership (“SNC”)

Removal of managers (“gérants”) from a French General Partnership (“SNC”)

The term of office of a manager (“gérant”) of a SNC is determined either in the bylaws of the General Partnership or in the decision taken by the partners appointing the manager. In the absence of specific provision regarding duration, the manager may remain in office indefinitely, unless he/she is  dismissed or resigns from office.

Dismissal of a manager (“gérant”) from a French General Partnership by the partners of the General Partnership

According to article L 221-12 of the French Commercial Code, “If all the partners are managing partners or if one or more managing partners chosen from among the partners are designated in the Articles of Association, the removal of one of them from office may only be decided unanimously by the other partners. This will result in the dissolution of the company, unless its continuation is provided for in the Articles of Association or is unanimously decided by the other shareholders. The dismissed manager may then decide to withdraw from the company by requesting the repayment of his corporate rights, the value of which is determined in accordance with article 1843-4 of the Civil Code. Any clause contrary to article 1843-4 of the said code is deemed unwritten.

If one or more partners are managing partners and are not designated in the Articles of Association, each of them may be removed from office under the conditions set out in the Articles of Association or, failing this, by a unanimous decision of the other partners, whether managing partners or not.

The non-member managing partner may be removed from office under the conditions laid down in the Articles of Association or, failing this, by a decision of the partners taken by a majority vote.

If the dismissal is decided without just cause, it may give rise to damages.”

If the partners decide to continue the company, despite the removal of one of the managing partners designated in the articles of association, then such continuation should be resolved upon prior to the removal of said manager (“gérant”).

In all cases, the removal from office of a manager (“gérant”) may not be unduly restricted, however it must not be abusive.

If the dismissed manager (“gérant”) is bound to the company by an employment contract, he/she retains the benefits of this contract and, in particular, the right to compensation in the event of dismissal.

Judicial dismissal of a manager (“gérant”) from a French General Partnership

The dismissal of the managing partners may be requested in court by any of the partners, provided that the latter can justify a legitimate cause for removal.

A dismissed manager may be entitled to damages if he has been dismissed without just cause or in an abusive manner.

Resignation of a manager (“gérant”) from a French General Partnership

The manager of a French General Partnership, regardless of whether such manager is or is not a partner of the Partnership, may resign from his position. However, he or she is liable to pay damages to the company if he or she resigns without just cause, and if this resignation causes damage to the company.

The resignation of the manager (“gérant”) takes effect as soon as it has been notified to the other associates.

To become effective, the resignation must only be notified to the partners, regardless of whether they accept it or not.

Once notified, the resignation cannot subsequently be withdrawn by the resigning manager.

If all the managing partners resign from their positions without being replaced, then all partners automatically become co-managing partners of the company.

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