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Issue Convertible Bonds in a SASU in France
Strengthen your company’s financing structure with convertible bonds—an elegant tool allowing investors to lend funds now and potentially become shareholders later.
Our French corporate lawyers and paralegals manage the entire process end-to-end: drafting the bond issue terms, preparing the sole shareholder’s resolution, publishing the legal notice, filing with the Commercial Court Registry, and providing the updated Kbis extract reflecting the operation.
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What are Convertible Bonds in a SASU ?
A convertible bond (obligation convertible en actions – “OCA”) is a debt instrument issued by a SASU that can later be converted into shares.
This hybrid mechanism combines the stability of debt and the potential upside of equity—a preferred choice for raising capital without immediate dilution.
Convertible bonds allow your SASU to:
- Obtain financing while postponing shareholder dilution;
- Reinforce equity when bonds are converted into shares;
- Negotiate flexibility in interest rates, maturity, and conversion ratios;
- Attract investors seeking both income and growth potential.
In essence, OCAs are a strategic financing tool — ideal for entrepreneurs, investors, or holding structures seeking flexibility and future-oriented capital management.
Main Advantages :
No immediate dilution: existing ownership is preserved until conversion.
Attractive financing: investors receive interest until conversion.
Equity reinforcement: converted bonds strengthen share capital and creditworthiness.
Flexible terms: maturity, rate, and conversion conditions are tailored in the issue deed.
Investor appeal: combines debt security with potential share participation.
Issuing convertible bonds is a sophisticated, legally secure way to fund growth while maintaining control over your SASU.
How to Issue Convertible Bonds in a SASU?
With FrenchCo.lawyer, the issuance process is handled seamlessly by our team of French corporate lawyers and paralegals.
We guide you through every stage — ensuring full compliance and smooth execution.
Gathering Essential Information
We collect all necessary data: the bond amount, interest rate, duration, conversion conditions, and investor identity. Each parameter is checked for legal accuracy and financial consistency.
Drafting the Legal Documentation
Our lawyers prepare the bond issue report, the shareholder’s decision, and—where relevant—the auditor’s certificate (commissaire aux comptes or aux apports). We also draft the terms of conversion and prepare the publication notice for the legal gazette.
Managing Subscriptions and Records
We assist in collecting subscription forms, setting up the register of bondholders, and ensuring that funds are properly transferred to the company. If convertible into shares, conversion mechanics and future capital adjustment are clearly documented.
Filing with the Registry
We file the complete dossier with the Commercial Court Registry: shareholder resolution, issue documentation, publication certificate, and registry forms. Our team monitors the validation and registration process until completion.
Delivery of the Updated Kbis
Once the issuance is registered, you receive the updated Kbis extract and certified copies confirming that the convertible bonds have been officially issued.
With FrenchCo.lawyer
All work is supervised by registered French lawyers and executed by trained paralegals, ensuring precision, legal compliance, and efficiency. We handle every step — from drafting to filing — so you can focus on strategy, financing, and growing your company with complete peace of mind.
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What We Need From You to Issue Convertible Bonds in French SASU ?
To organize a compliant and efficient convertible bond issue, please provide:
Company Details
Corporate name, SIREN number, registered office, and current share capital.
Bond Terms
Total amount of the issue, interest rate, maturity, repayment schedule, and conversion ratio.
Investor Information
Identity and address of the subscriber(s), whether individuals or legal entities.
Supporting Financial Documents
Bank confirmation of funds received or, if applicable, valuation of in-kind contributions.
And Then?
Once all information is collected, our lawyers take over: preparing the issue report, shareholder resolutions, publication, and filing with the registry — until you receive your official Kbis extract confirming the convertible bond issuance.
Issue Convertible Bonds in a SASU– Simple Process, Clear Budget
Flat legal fee starting from €949 excl. taxes
Additional mandatory costs : publication in the official gazette + court registry filing fees
No hidden costs, no upselling.
Our commitment:
No hidden financial clauses
No intermediaries or brokers
Only qualified legal work
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Why Choose Us?
We Believe in Transparent, Lawyer-Led Corporate Financing
Fast and reliable issuance: From drafting terms to registration, we manage each stage of the convertible bond process efficiently and securely.
Legally compliant documentation: Every issuance agreement and report is prepared in full accordance with French corporate and financial regulations.
Protective legal structuring: Your convertible bond terms are drafted to safeguard shareholder rights and anticipate future equity conversion scenarios.
High professional standards: All work is handled by licensed French lawyers experienced in SASU financing, ensuring accuracy and accountability.
Let us handle your convertible bond issuance — so you can focus on financing and expanding your SASU with confidence.
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Understanding the Issuance of Convertible Bonds in a French SASU
Can a foreigner subscribe to convertible bonds in a SASU (and can they serve as president)?
Yes. Foreign individuals or legal entities can subscribe to convertible bonds (obligations convertibles en actions – OCA) issued by a SASU. If a later conversion brings in a second shareholder, the SASU becomes a SAS. A foreigner can also be appointed president. The determining factor is residency, not nationality.
1) Investors/Presidents living abroad
No French residence permit is required merely to invest or to exercise the office of president from abroad. The bond issuance and filings can be completed remotely and registered with the RCS.
2) EU/EEA/Swiss citizens
They can invest or preside without restriction. If they later move to France, a simple mairie registration after arrival may apply; no residence card is required.
3) Non-EU residents settling in France
They must obtain an appropriate residence permit (e.g., “entrepreneur/profession libérale”, multi-year card, or a relevant Talent permit). Non-compliance may lead to penalties.
4) Special bilateral regimes
Some nationals (e.g., Algeria, Andorra, Monaco) may benefit from treaty-specific rules.
5) Registration with the RCS
Once any immigration steps (if relevant) are satisfied, the sole shareholder’s decision, the issue documentation, and (if conversion impacts capital now or later) the bylaws mechanics are filed with the Commercial Court Registry so the operation is opposable to third parties.
What are the social security implications of issuing convertible bonds?
Generally none:
- The president of a SASU/SAS is assimilé-salarié; social contributions are based on salary, not on bond issuance or ownership.
- Bondholders who are not employees or officers do not pay social charges merely for holding bonds or receiving interest.
- If bonds convert into shares later, mere share ownership still does not trigger social charges (dividends in SAS/SASU do not fall under TNS rules).
For presidents living abroad, coverage follows EU coordination (A1) or bilateral treaties; otherwise, French affiliation may apply if salary is paid in France.
What documents and proofs are required at subscription?
- Sole shareholder’s decision authorizing the bond issue and setting the main terms;
- Issue deed/terms (amount, rate, maturity, conversion conditions, covenants);
- Subscription forms and proof of funds (bank transfer/receipt);
- Register of bondholders (opened and updated);
- Publication certificate (legal gazette notice);
- Registry forms and fees (filing with the RCS).
If conversion is immediate or scheduled, ensure bylaws already include (or authorize) the necessary capital mechanics.
What are the step-by-step formalities to issue convertible bonds?
- Decision of the sole shareholder
Approval of the OCA terms (amount, rate, maturity, conversion mechanics) and any bylaw authorizations. - Drafting the documentation
Issue report/terms, subscription forms, potential auditor involvement, and the legal notice content. - Subscription & funds
Collect signed subscription forms and funds; record bondholders in the register. - Publication
Publish the notice in a journal d’annonces légales (JAL). - Filing with the RCS
Submit the dossier (decision, issue terms, publication proof, registry forms, fees). The registry makes the issue opposable to third parties. - Kbis update
Obtain the updated Kbis showing the operation where applicable.
How does financing with OCAs in a SASU compare to similar moves in an EURL?
Aspect | SASU/SAS with OCA | EURL equivalent |
Default tax | IS (interest deductibility rules apply) | IR by default if individual shareholder; IS if opted |
Social regime | President = assimilé-salarié | Majority manager = TNS (dividends under IS partly hit by TNS rules) |
Investor tools | Very investor-friendly (OCA, preferred shares later) | More rigid; often converted before investor rounds |
Conversion | Seamless into shares within SAS flexibility | Less flexible equity mechanics |
Bottom line: SASU/SAS provides a clean, flexible path for investor debt that can later become equity.
Is there a minimum size for a SASU convertible bond issue?
There is no statutory minimum size for an OCA issue. What matters is that the financial terms are coherent and the issue is properly documented.
- Cash is the norm: OCAs are typically subscribed in cash; in-kind “debt” is uncommon.
- Paid-up requirements: subscriptions are generally fully paid on issuance (interest then accrues per the terms).
- Conversion ratio/premium: define a fair conversion price (or formula) to protect existing value; you can include a conversion premium or anti-dilution protections.
- Auditor involvement: an issuer’s statutory auditor may be involved for certain reports; if conversion will create shares later, ensure valuation logic and capital ceilings are set to avoid future blockage.
Practical tip: very small, “symbolic” issues are lawful but can undermine credibility with banks and partners. Align size with your funding plan and signaling goals.
Where can my SASU be registered (siège social) when issuing convertible bonds?
Issuing OCAs does not change your options for the registered office:
- Owned/leased premises (provide title or commercial lease);
- President’s home (within statutory, lease, and co-ownership limits; often time-limited in large cities and without receiving clients/stock);
- Domiciliation company (prefecture-approved provider);
- Parent company’s address (if one entity lawfully enjoys the premises).
Risks if mismanaged: letting a temporary domiciliation lapse can lead to strike-off; breaching lease/co-ownership limits risks termination; using a non-approved domiciliation provider can result in fines. Choose an address balancing cost, compliance, and credibility.
What taxes are relevant when my SASU issues convertible bonds?
Issuing OCAs does not change the SASU’s default corporate tax (IS) treatment, but it has fiscal effects to consider:
- Interest deductibility
Interest paid on OCAs is generally deductible for IS purposes, subject to interest-limitation rules and transfer-pricing principles where relevant. - Registration/VAT
- OCA subscriptions are typically outside VAT’s scope.
- Registration duties on bond issues are generally limited or not applicable (distinct from certain equity or real-estate transfers).
- Withholding/investor taxation
Investor-level taxation on interest or on gains at conversion depends on the holder’s tax status and any applicable treaties (for non-residents). Corporate and individual investors may face different treatments. - On conversion
Conversion increases share capital (and/or share premium). No corporate tax arises solely from the conversion; subsequent dividends are taxed per ordinary rules.
Good practice: specify a clear conversion price (or formula) and anticipate tax/TP constraints if investors are related parties.
Convertible bonds vs ordinary share issue: what’s the difference?
Aspect | Convertible Bonds (OCA) | Ordinary Share Issue |
Immediate cash | Yes | Yes |
Immediate dilution | No (until conversion) | Yes |
Cost | Interest until conversion | No interest; legal costs only |
Balance sheet | Debt → later equity if converted | Equity immediately |
Signaling to banks | Shows leverage capacity; later equity potential | Strengthens equity now |
Flexibility | Highly customizable (rate, maturity, conversion) | Customizable via premium/rights, but equity only |
How does a SASU with OCAs compare to a sole proprietorship for raising funds?
Legal personality & liability
- SASU: separate entity; limited liability; clear bond-issuing framework.
- Sole proprietorship: no separate legal person; raising funds is typically personal borrowing.
Financing & continuity
- SASU: can issue securities (OCAs, shares) and onboard investors; perpetual continuity via shares.
- Sole proprietorship: funding relies on personal means; activity tied to the individual.
Tax & social
- SASU: IS regime; interest potentially deductible; president assimilé-salarié.
- Sole proprietorship: always IR; no security issuance; self-employed regime.
Conclusion: if you aim to structure outside capital and prepare for future equity, SASU is markedly more credible and flexible.
Issue Convertible Bonds in SASU
Let our French lawyers & paralegals handle the full issuance process for you.
More About Issuance of Convertible Bonds in a French SASU
Can legal entities subscribe to convertible bonds?
Yes. Both individuals and legal entities (companies, investment funds, holding structures) can subscribe to convertible bonds issued by a SASU. However, their rights upon conversion depend on the shareholding structure and the terms set in the bond agreement.
What documents will I need?
You’ll need the company’s up-to-date bylaws, the shareholder’s decision authorizing the bond issue, the special report from the president, and a detailed subscription form. Supporting identity and Kbis documents for investors are also required.
Do I need statutory auditor?
Not necessarily. A statutory auditor (commissaire aux comptes) is required only if the convertible bond includes preferential subscription terms or if your SASU exceeds specific legal thresholds. Otherwise, your lawyer can handle the process without one.
How long does the issuance take?
Typically between 10 and 15 business days — including drafting, legal approval, filing, and registration. Complex transactions or large subscriptions may require additional validation time.
Can I issue convertible bonds remotely?
Yes. The entire process — from drafting to signing and filing — can be completed remotely with secure digital signatures. We coordinate directly with the commercial court registry for validation and filing.
What are the typical costs?
- Legal fees depend on the transaction’s complexity and conversion terms. Our fixed-fee legal package covers drafting, coordination, and filing. Additional costs may include registry or notarial fees depending on your financing structure.
What about beneficial ownership (UBO) and compliance?
Any convertible bond issue must identify and declare the ultimate beneficial owner (UBO) of subscribing entities. We assist with all declarations to ensure full AML and transparency compliance.
Can I convert or modify the bonds later?
Yes. Convertible bonds can later be converted into shares under pre-agreed terms or amended by shareholder resolution. We can also assist with capital increase filings once the conversion is triggered.
