Public Limited Company (PLC)

What is a Public Limited Company (PLC)?

A public limited company (PLC) is a legal form of commercial company where the share capital is divided into shares. Intended for large-scale projects, its formation requires a notarized deed. Shareholders are liable up to the amount of their contributions.

Shareholders & Capital

A public limited company (PLC) requires a minimum of two shareholders (seven if it is listed on the stock exchange). These shareholders can be natural persons or legal entities (companies).

A major advantage of this status is limited liability: shareholders are only liable up to the amount of their capital contributions.

Management Bodies

A public limited company (PLC) is managed by a board of directors composed of at least three members (directors), whether they are shareholders or not.

• Powers of the directors: Defined by the articles of association of the company, they have by default the competence to carry out any act useful to the achievement of the corporate purpose, with the exception of decisions reserved for the General Meeting.
• Civil and criminal liability: Directors are personally liable to the company in the event of mismanagement.
• Day-to-day management: For greater agility, day-to-day management can be delegated to one or more managing directors.

The role of the Statutory Auditor (CAC)

Currently, the certification of a public limited company's accounts is a legal obligation entrusted to a statutory auditor. This independent professional ensures the financial transparency of the entity.

• Unlimited right of oversight: It controls all accounting and financial operations.
• Control mission: It verifies the regularity and accuracy of the annual accounts.
• Management report: The result of its work is subject to shareholder approval.

Legislative development: A bill proposes to make this control obligation more flexible, by allowing companies to include or not the presence of an auditor directly in their articles of association.

The General Assembly (GA): Sovereign Power

The General Meeting of Shareholders is the supreme decision-making body of the company.

• Mandatory frequency: It must meet at least once a year, on the date set by the statutes (generally for the approval of the accounts).
• Sovereignty: It is the board that approves the management of the board of directors, decides on the allocation of the result and appoints the managers or controllers.

Securities regime: Registered shares vs. Bearer shares

The capital of a public limited company (PLC) is represented by securities whose form can evolve according to the degree of release of capital and the choice of the shareholder.

1. The obligation of registered shares: Until the shares are fully paid up (i.e., until the entire subscribed value has been paid to the company), they must remain registered. The holder's name is then entered directly in the company's shareholder register.
2. Conversion into bearer shares: Once the capital has been fully paid up, the shareholder has the option to request the conversion of their securities into bearer shares.

   Legal framework: In accordance with the legislation on the immobilization of bearer securities (law of August 2014), these shares are no longer physically held by the partner. They must be deposited with an approved professional depositary, who ensures the maintenance of the register and the traceability of exchanges.

3. Right of reversibility: The flexibility is total: owners of bearer shares retain the right, at any time, to request their conversion into registered shares.

Financing the public limited company: The bond issue

Beyond its share capital, the public limited company has significant external financing options. The law thus authorizes the issuance of bonds, allowing the company to raise funds from investors in exchange for debt securities.

Forms of bond securities

Just like shares, bonds issued by the PLC can take two distinct legal forms depending on the investor's choice or the issuance methods:

• Registered bonds: The holder's name is recorded in the issuing company's registers, which facilitates direct contact with the investor.
• Bearer bonds: These securities are registered in an account with a financial intermediary. They offer greater ease of trading on financial markets.

Dissolution and Liquidation of the PLC

The dissolution of a public limited company follows a rigorous procedure governed by law to protect creditors and shareholders.

1. Liquidation proceedings

The decision to dissolve the company is made by the General Meeting. During this meeting, shareholders must make two key appointments:

• The liquidator: He replaces the administrators to manage the closure period.
• The liquidation commissioner(s): Responsible for overseeing the closing operations.

2. Closing of operations

Once the liabilities have been settled and the assets realized, the procedure ends before the sovereign court:

• Final report: The General Assembly hears the detailed report of the liquidator as well as that of the auditors.
• Final closure: It is this assembly that votes to close the liquidation, resulting in the disappearance of the company's legal personality.