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SETTING UP A BUSINESS IN MONACO
The practice of a commercial, craft or
industrial activity or a service sector activity requires an authorization
from the Royal government. The authorization is granted or refused
according to the guarantees furnished by the applicant and the interest
that the project presents for the economy of Monaco. In order to obtain an
authorization to set up a business in Monaco, the applicant must request
an application form from the Direction de l'Expansion Economique, and duly
return the dossier to the same service.
 Legal structures possible for
businessesThere are a variety of different legal
forms possible for setting up an economic activity in the Principality.
For commercial enterprises, the following structures are available :
General Partnership (S.N.C.)
Limited Partnership
(S.C.S.)
Limited Partnership with Shares (S.C.A.)
Monegasque
Limited Company (S.A.M.)
Foreign companies may also locate a branch
or administrative office in the Principality. Any person whose status so
permits may create a Trust.
Exchange with foreign country
As specified in certain Franco-Monegasque
agreements, regulations concerning customs and currency exchange are the
same in Monaco as in France. The two States constitute a Customs Union and
there is, thus, complete freedom of movement of capital between them.
Although Monaco is tied to France within the framework of European
Economic Community customs territory regulations, Monaco is not a member
of the EEC.
SPECIAL EXEMPTIONS FOR NEW COMPANIES AND
RESEARCH
In order to encourage the creation of
companies and to develop the scientific and technical research sector, the
Royal government offers certain fiscal advantages. In fact, these firms
are eligible for tax breaks. A tax credit of up to 40 million French
francs may be granted. All firms created in the Principality and subject
to the company tax on profits are exempted from tax for the first two
years and partly exempted for the third year.
Any person or company wishing to hire
personnel must receive an authorization to hire and must register the
personel at the Social Service Compensation Fund (Caisse de Compensation
des Services Sociaux - CCSS ) and at the Independent Pension Scheme Fund
(Caisse Autonome des Retraites - CAR).
This registration gives the
employee certain rights :
- family subsidies for dependant children,
- partial reimbursement
of medical fees in case of illness
- as well as a retirement
pension.
The following are the current social security contribution rates for
employers :
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CCSS: |
16,15% of the gross salary to
be paid by the employer
0,05%
of the gross salary to be paid by the employee. |
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CAR: |
7,05% of the gross salary to be
paid by the employer
6,15% of
the gross salary to be paid by the employee. |
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In certain cases, employers may be eligible for
exemption. |
Contributions identical to those paid by employers in France must be
paid to various services for unemployment insurance coverage and
additional retirement pensions for executive and non-executive
employees.
The total employer's share of social security
contributions on salaries represents an average rate of 33%.
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