The purpose of an SCI is to purchase and manage a portfolio of real estate assets for several people. This involves appointing a manager when the company is set up. He or she is responsible for the day-to-day management of the company's business and its ongoing smooth running.
Its functions are freely defined in the company's Articles of Association.
An SCI can be run by one or more managing directors. To be eligible for this position, certain conditions must be met. The manager of an SCI must be a natural or legal person (in this case, the legal representative of the company becomes the manager), of legal age (or an emancipated minor).
The managing director must not have been convicted of any offence that would prohibit him/her from managing a company. Also, certain professions do not entitle the holder to hold a management position at the same time.
The manager of an SCI has several important powers. His primary mission is to ensure that the company's accounts are properly kept. He or she must keep cash accounts: a ledger records all receipts and disbursements made on behalf of the company. He has the power to commit the SCI to third parties.
On a day-to-day basis, he or she is also responsible for collecting rents, paying the company's utilities, filing tax returns, managing property insurance, hiring staff (where necessary) and maintaining the properties in the portfolio.
In some cases, it is possible to set up a special mandate to define the manager's powers more strictly, or to divide them cleverly between several managers. The manager is accountable to the SCI partners, and must draw up a management report at least once a year.
The rules for appointing a manager are freely defined in the company's articles of association. In most cases, the partners at a general meeting vote to elect the SCI's manager.
If no specific procedure is specified in the bylaws, then the person who receives the majority of votes from associates representing more than half of the shares is elected.
His or her name may be included in the articles of association or in a separate deed, to formalize the appointment.
The manager of an SCI may receive remuneration, but is not obliged to do so. This decision may be taken or reviewed at each general meeting.
In this case, the partners meet and vote for or against the proposed remuneration. If the manager is also a partner, he or she is entitled to take part in the vote. It should be noted that the majority of SCI managers are generally unpaid.
Any remuneration paid to the SCI's manager must appear in its accounts. accounting.
If the manager is remunerated but is not a partner, and has no subordinate relationship with the SCI, he or she is considered a self-employed worker. In this case, he is affiliated to the social security for the self-employed. If there is a subordinate relationship, he or she is considered an employee and is covered by the general social security scheme.
It is important to note that he does not contribute to unemployment insurance.
If the manager is a remunerated partner, and has no subordinate relationship with the SCI, then he or she is considered as a self-employed worker. He is therefore covered by the social security system for self-employed workers.
If a relationship of subordination exists, the employee is considered a salaried worker, and is covered by the general social security scheme. Nor does he/she contribute to unemployment insurance.
Lastly, an unpaid manager is not subject to any social security contributions, and therefore to no form of social protection for the exercise of this function.
The manager of an SCI is elected for a limited term. His or her duties therefore end when the mandate entrusted to him or her expires.
The managing director may also resign during his term of office. To do so, he must inform the partners by registered letter with acknowledgement of receipt. He is not required to justify his decision. If his departure causes prejudice to the company, he must compensate it accordingly.
Lastly, a SCI manager may be dismissed by a decision of the partners representing more than half of the company's shares. He or she may not be dismissed before the end of his or her term of office without just cause.
Otherwise, SCI is obliged to compensate him for the damage caused.
The SCI's articles of association are therefore the key document for intelligently defining the manager's mandate. A number of specific clauses can be included, such as age limits, specific skills requirements, grounds for dismissal, conditions for resignation, etc.
Written by our expert Paul LASBARRERES-CANDAU
June 7, 2021
