Ending a Manager’s Mandate in a French SARL: Rules, Risks, and Practical Steps

In a French SARL (Société à responsabilité limitée), the gérant (manager) is the company’s legal representative. Understanding how and when a manager’s functions end—and what to do next—is essential to avoid governance deadlocks, liability traps, and disputes with partners or third parties.

This guide explains the triggers for ending a mandate (expiry, death/incapacity, resignation, and revocation), the procedure to follow, the role of “just cause” when revoking a manager, the indemnities risk, and the publication obligations. It also covers practical edge cases (urgent meetings, co-management, banking secrecy, and more).

Key statutes referenced include Code de commerce (notably L.223-18, L.223-25, L.223-27, L.223-29, L.210-9, R.223-20, R.223-23) and relevant case law.

1. Expiration of the Mandate of a SARL Manager

The duration of the manager’s mandate in a société à responsabilité limitée (SARL) depends on whether the articles of association or the act of appointment specify a term. In the absence of an express provision, the law provides for an appointment of indefinite duration. Where a fixed term is stipulated, the mandate ends automatically upon expiry of that term. In both cases, the law and case law have clarified the events and conditions that may bring the mandate to an end.

a. Indefinite duration by default

When the articles of association or the appointment act do not specify a duration—or when they expressly refer to an “unlimited” or “indeterminate” mandate—the manager is deemed appointed for the entire life of the company (C. com., art. L. 223-18, para. 3). Nevertheless, certain events can terminate the mandate earlier, including death, incapacity, resignation, or dismissal.

b. Fixed duration

When the articles of association establish a fixed term, the mandate ends automatically at its expiry. No notice and no specific pre-termination formalities are required.

• No automatic right to renewal. The manager has no legal entitlement to renewal of the mandate. However, if the decision not to renew is taken or communicated under humiliating or vexatious conditions, the company may incur liability for damages.

• Timing of non-renewal. A decision not to renew takes effect only at the contractual or statutory term. Even if the shareholders vote on non-renewal before the expiry date, this does not constitute a dismissal; the mandate continues until its natural end.

• “End at the annual meeting” clauses. Clauses providing that the mandate ends “at the meeting approving the annual accounts held in the year of expiry” do not truncate the mandate to one year. If the annual meeting is not held for several years, the mandate may be considered to continue, unless the clause explicitly makes the holding of the meeting mandatory and links the mandate’s duration to the actual convening of that meeting.

> Practical Takeaway

When a manager is appointed for a fixed term, the mandate ends automatically upon expiry, without the need for notice or any particular formalities. In contrast, when the appointment is made for an indefinite term, the mandate continues until an early-termination event occurs—such as resignation, dismissal, incapacity, or death—or until the company itself is dissolved.

It is therefore advisable to draft the articles of association with precision. Clear wording helps avoid situations where the absence of an annual meeting creates uncertainty and results in so-called “ghost mandates,” in which a manager appears to remain in office indefinitely despite the intention to limit the mandate.

2. Death, Incapacity, and Urgent Replacement of a SARL Manager

The functions of a manager end immediately upon the occurrence of certain events, such as death, personal bankruptcy or disqualification, the assumption of an incompatible office, or criminal convictions that legally prohibit the exercise of management. The termination of the mandate in such cases does not result in the dissolution of the company: the SARL continues to exist, and a successor may be appointed. If co-managers remain in office, the partners may even decide that replacement is unnecessary. Importantly, delegations of authority previously granted by the deceased manager remain valid.

Since the reform of 21 July 2019, the law provides emergency procedures to ensure continuity of management. In the absence of a manager, or if the manager is placed under guardianship, any partner—or the statutory auditor, if one has been appointed—may convene a general meeting. When a sole manager dies, the notice period for convening the meeting is reduced to eight days instead of fifteen. If the deceased manager was also a partner, the meeting is chaired by the partner present who holds the largest number of shares.

> Practical Takeaway

In the event of a manager’s death or incapacity, partners should act without delay. The expedited procedures are designed to restore effective representation and prevent paralysis of the company’s operations.

3. Resignation of the Manager of a SARL

The resignation of a gérant is a unilateral act, available at any time, and does not require the justification of a legitimate reason. Nevertheless, this freedom is not without limits: liability may arise in cases of abrupt departure, the validity of consent must be ensured, and statutory provisions may regulate the process. The law and case law together provide a framework designed to balance managerial autonomy with the need for stability in corporate governance.

3.1 General principle

A manager may resign at any time without having to demonstrate a legitimate ground. The act is, in principle, unilateral. However, a resignation that is abrupt and unexpected can expose the manager to liability if it causes loss to the company. Damages may be avoided only if the manager demonstrates that continuing in the role would have caused serious personal prejudice (C. civ. 2007).

3.2 Validity of consent

A resignation is valid only if it reflects the free and informed will of the manager.

• A resignation signed under coercion by co-partners, particularly to force acceptance of a revocation, is not a true expression of will.

• By contrast, ordinary criticism or oversight during a meeting—where the manager has the opportunity to respond—does not amount to illegitimate pressure if the resignation is otherwise clear and unequivocal.

3.3 Statutory regulation of resignation

The articles of association may set rules for the resignation process, such as notice requirements, notification obligations, or acceptance mechanics. Failure to comply with these clauses may constitute fault if the resignation is abrupt and disruptive.

3.4 Form and effects of the resignation of a manager (“gérant”) of a SARL

Resignation does not require elaborate formalities. A simple letter is sufficient, though registered mail is recommended as proof.

• Addressees: If there are multiple managers, the resignation must be notified to the others. If there is only one manager, the resignation must be notified to the partners, who must be urgently convened to appoint a successor.

• Effectiveness: Unless the articles provide otherwise, the resignation takes effect upon notification to the company. It does not require acceptance by the partners and cannot be retracted, although the validity may be contested if consent was not free and informed.

• Publicity: The resigning manager may personally request the registration of the resignation with the Commercial and Companies Register (RCS).

• Notice clauses: If a contract specifies that resignation takes effect only at the end of a notice period, that clause governs. If the contract merely requires notice, without delaying effect, the resignation is effective immediately upon notification.

3.5 The question of “Blank resignations” (démissions en blanc)

The use of pre-signed, undated resignation letters carries significant legal risks. Courts may treat their activation as a disguised revocation, which can expose the company to damages.

> Practical Takeaway

A resignation should always be documented in a dated and properly notified form, with compliance to any statutory or contractual notice requirements, and followed by filing with the RCS. The use of “blank resignations” should be strictly avoided, as they undermine the validity of corporate governance and risk judicial requalification.

4. Dismissal (“révocation”) of the SARL Manager by the Shareholders

The manager of an SARL may, in principle, be dismissed at any time by decision of the partners.

The conditions for such revocation depend on the applicable majority rules, the manager’s position as a shareholder, and the substantive acts that can legally be considered a dismissal. Although the freedom to revoke is broad, the law and case law impose limits to prevent disguised irrevocability and to protect both the company’s functioning and the manager’s rights.

In addition, and unless the bylaws specify that the SARL Manager may be revoked ad nutum, the revocation of a manager without a “just cause” gives rise to damages.

In all events, the revocation of a SARL manager must not be vexatious or abusive, failing which the manager may claim an indemnity.

In the event of deadlock situations (such as, impossibility to revoke a manager because the latter is also a shareholder and blocks the revocation resolution), the manager may be revoked by the court for “legitimate cause”.

4.1 Shareholder Majority Required to Dismiss a SARL Manager

Unless the articles of association impose a higher threshold, revocation may be decided at any time by partners representing more than half of the share capital.

• On the first call, the decision requires more than 50% of the shares. Where the manager controls a majority of shares, revocation cannot succeed.

• On the second call, the decision may pass by a simple majority of the votes cast, regardless of the number of attendees.

• The articles may validly impose a stronger majority requirement. However, for such a clause to be effective, they must expressly exclude the second consultation mechanism; otherwise, the second-call rule will allow revocation by relative majority.

• By contrast, unanimity clauses for revocation are invalid, as they would create a de facto irrevocability of the manager’s mandate.

A manager who is also a partner retains the right to participate and vote in deliberations concerning their own appointment or dismissal, except where the law provides otherwise. As a result, a manager who is a majority or equal shareholder may be effectively irremovable by partner vote. In such circumstances, the other partners must consider seeking judicial revocation (see Section 6).

4.2 Acts constituting dismissal (“révocation”) of a SARL Manager

The concept of “revocation” is interpreted broadly by case law to cover measures that deprive the manager of the substance of their mandate.

• Amending the duration or terms of the mandate without the manager’s consent amounts to a dismissal.

• Removing all managerial powers is also treated as a revocation.

• Withdrawing remuneration does not in itself constitute revocation if the manager simultaneously holds a valid employment contract.

• Transforming an SARL into a société anonyme (SA) terminates the functions of the manager, provided the transformation is carried out regularly and without abuse. Where the transformation is used to conceal a dismissal, however, it may be recharacterized as a revocation.

> Practical Takeaway

Revocation is always possible in principle, but its effectiveness depends on the balance of shareholding and the drafting of the articles. Care must be taken to avoid clauses that render the manager de facto irremovable, and to recognize that indirect measures—such as stripping powers or altering mandate terms—may still be legally treated as dismissals.

4.3 Dealing with Obstacles to revoking a SARL Manager: Lender “Key-Man” Clauses / Manager’s Refusal to Convene a Shareholders’ Meeting

The partners’ freedom to appoint and dismiss the manager is a cornerstone of SARL governance. This freedom cannot be restricted by lenders or obstructed by the manager himself. Both contractual clauses and managerial inaction have been addressed by the courts to preserve shareholder rights and ensure that deliberations on revocation can take place.

• Invalidity of lender “key-man” clauses

Clauses in loan agreements that make early repayment conditional on the continued presence of a named manager are null and void. Such provisions unlawfully interfere with the partners’ freedom to choose or revoke their manager, and constitute excessive interference by a lender in the internal governance of the company (French Supreme Court, Commercial Chamber, 8 February 2000, no. 97-19237). The invalidity is limited to the clause itself: the remainder of the loan contract remains valid and enforceable.

• Judicial assistance if the manager refuses to convene a meeting

Where the manager refuses to convene a general meeting, any partner may petition the commercial court for the appointment of a judicial representative (mandataire ad hoc) tasked with calling the meeting and setting the agenda.

• At this stage, the judge is not required to assess the substantive merits of the proposed revocation. The intervention is procedural, intended solely to remedy the manager’s failure to act.

• Nevertheless, the request must be consistent with the overall interests of the company, as the court retains a margin of appreciation in appointing the representative.

4.4. Dismissal of a SARL Manager for “Just Cause” by the Shareholders

The principle of ad nutum dismissal, which allows the partners of an SARL to remove the manager at any time, is tempered by the requirement of “just cause.” While dismissal remains possible without justification, a decision taken arbitrarily or without legitimate grounds may expose the company to liability for damages and interest. Conversely, where the manager’s conduct constitutes a serious fault or jeopardizes the company’s interests, the dismissal will be considered justified and no compensation will be owed. Jurisprudence has progressively refined the contours of what amounts to “just cause,” balancing managerial autonomy against the imperative of protecting the company’s proper functioning.

a. Notion of Just Cause and Liability for Damages

A manager dismissed without just cause may seek damages for the injury suffered. Conversely, the existence of serious misconduct, mismanagement, or behavior incompatible with the company’s interests excludes compensation. Courts have consistently held that actions compromising the company’s proper functioning, or constituting breaches of legal or contractual obligations, amount to just cause (Cass. com., 4 May 1993, no. 91-14693; Cass. com., 4 May 1999, no. 96-19503).

b. Mismanagement and Fault

Mismanagement, imprudence, or negligence in the conduct of company affairs frequently serves as grounds for dismissal. To constitute just cause, such failings must demonstrate sufficient gravity.

• Harassment of employees. Acts of moral harassment by the manager—manifested through verbal aggressiveness, contradictory or incoherent directives, or humiliating conduct—constitute a legitimate cause for dismissal. Similarly, disregard for protective legislation, such as rules safeguarding pregnant employees, may justify dismissal regardless of financial impact (Cass. com., 15 Jan. 2020, no. 18-12009).

• Failure to convene meetings. Persistent failure to convene the annual meeting, or exceeding the statutory six-month deadline, constitutes just cause, particularly where such omissions coincide with other irregularities such as undeclared employment (CA Paris, 8 Nov. 1991; CA Paris, 25 Apr. 2000).

• Loss of confidence. A loss of confidence may amount to just cause where it arises from concrete breaches of duty, such as disobedience to partner instructions on financial management or misuse of company accounts (CA Paris, 24 Oct. 2003). However, this ground is invalid if invoked in vague terms or contradicted by contemporaneous approval of management (Cass. com., 12 Feb. 2013, no. 11-23610).

• Current account overdraft. A manager who allows his partner’s current account to remain in debit, in violation of Article L. 223-21 of the Commercial Code, incurs dismissal (Cass. com., 27 May 2015, no. 14-14540).

• Undermining the company externally. Serious misconduct is established when a manager compromises the company’s projects before third parties, such as by disparaging the company during a fundraising phase (Cass. com., 11 Mar. 2014, no. 12-12074).

• Speculative or ruinous management. Engaging in reckless projects, adopting financially ruinous policies, or refusing to resign despite prior commitments when deficits persist, may all justify dismissal (Cass. com., 17 Dec. 1974, no. 73-14003).

• Excessive remuneration. Unilateral increases in managerial remuneration despite poor results and losses may equally constitute just cause (CA Paris, 14 Mar. 1977).

c. Protection of the Company’s Interest

Even absent specific misconduct, the manager’s continuation in office may be incompatible with the company’s interest. For dismissal to be justified on this ground, the facts must reveal actual or foreseeable harm of a serious nature. This encompasses inconsiderate expenditures, incapacity to fulfill managerial duties, or behavior undermining the company’s cohesion and direction.

• Disagreements and dissension. Persistent disagreements may constitute just cause where they compromise the company’s interests or paralyze its functioning (Cass. com., 4 May 1999; CA Versailles, 11 May 2000). A disagreement between co-managers justifies dismissal only if it obstructs the company’s operations (Cass. com., 7 Jan. 2014, no. 13-11866).

• Wasteful decisions. Decisions contrary to the company’s interest, such as ordering an unnecessary audit at a disproportionate cost that nearly eliminates profits, amount to serious misconduct (Cass. com., 15 Feb. 1994, no. 92-12201).

d. Practical Implications

The concept of just cause provides both flexibility and discipline. On the one hand, partners retain broad discretion to remove the manager when necessary for the company’s welfare. On the other, this discretion is not absolute: dismissal without concrete justification may give rise to compensation, while only conduct of a sufficiently serious nature exempts the company from liability. Case law thus serves as a guide, illustrating the forms of managerial misconduct and dysfunction that are consistently treated as legitimate grounds for dismissal.

4.5. Dismissal of a SARL Manager Without Just Cause and Compensation Obligations

Although managers of an SARL are, in principle, revocable ad nutum, the absence of just cause does not render the partners’ decision invalid. The revocation remains effective; however, it exposes the company—and in some cases the partners themselves—to liability in damages. The law thereby preserves the partners’ sovereign freedom to choose their management while ensuring that this freedom is not exercised in an abusive or arbitrary manner.

a. Effect of Dismissal Without Just Cause

The absence of just cause does not entitle the dismissed manager to reinstatement. The courts have consistently held that such circumstances cannot lead to the annulment of the meeting at which the dismissal was pronounced, nor to a declaration of inexistence of the decision (Cass. com., 8 Mar. 1982, no. 80-15782). The manager’s remedy lies exclusively in an action for damages, pursuant to Article L. 223-25 of the Commercial Code, based on the material or moral prejudice suffered.

b. Illustrative Cases of Unjustified Dismissal

The jurisprudence identifies a range of situations in which dismissal is not founded on just cause:

• Change of majority. The arrival of new partners who wish to appoint a manager of their own choice, absent any reproach of mismanagement against the incumbent, does not justify dismissal (Cass. com., 29 May 1972).

• Minor disagreements. Secondary disagreements that could reasonably have been resolved through dialogue do not constitute just cause (Cass. com., 30 May 1980, no. 78-15032).

• Unattributable losses. Losses suffered by the company, where they are not imputable to the manager—for example, when purchase and resale prices are determined by another entity controlled by the principal partner—do not establish just cause (Cass. com., 22 Oct. 2002, no. 98-10810).

• Warnings to partners. A manager’s forceful opposition to partner decisions, when expressed in good faith as warnings against harmful measures, cannot justify dismissal (Cass. com., 9 Nov. 2010, no. 09-71284).

• Exercise of fundamental rights. The fact that a manager has brought legal proceedings against the company does not constitute just cause; access to justice is a fundamental freedom (Cass. com., 21 June 2023, no. 21-21875, concerning an SAS but transposable to SARLs).

c. Determination of Compensation Due Upon Unjustified Dismissal of a SARL Manager

When dismissal is found to be without just cause, compensation is assessed by the courts with reference to multiple factors:

• the loss of remuneration the manager would have received for the remainder of the mandate;

• the conditions in which the dismissal was carried out;

• the circumstances that may compel the dismissed manager-partner to withdraw from the company.

Statutory clauses may provide for lump-sum compensation in the event of dismissal without just cause. However, for such clauses to be valid, the amount stipulated must not be so excessive as to discourage the partners from exercising their right of dismissal (Cass. com., 2 June 1987, no. 85-16467; CA Amiens, 8 Mar. 2011, SARL Eolec; Cass. com., 6 Nov. 2012, no. 11-20582). In all cases, the amount remains subject to judicial moderation under the rules governing penalty clauses (C. civ., art. 1231-5).

Severance indemnities are treated as taxable remuneration. In principle, the company bears the financial burden of such compensation. Nonetheless, where the partners have committed a personal fault in the circumstances of the dismissal, they may be held jointly and severally liable alongside the company, pursuant to Article 1240 of the Civil Code.

d. Practical Implications

Dismissal without just cause, while always valid in form, exposes the company to significant financial consequences. Partners should therefore ensure that the grounds for dismissal are carefully documented and, where possible, linked to concrete failings of management or to risks for the company’s interest. Otherwise, the revocation—though effective—may result in costly litigation and damages.

4.6. The Prohibition of Sudden and Vexatious Dismissal of a SARL Manager

The partners’ freedom to revoke a manager at any time is not without limits. Where a dismissal is inspired by vexatious intent or carried out under abrupt and humiliating conditions, it constitutes an abuse of rights. In such cases, the partners may be found personally at fault and the company may be ordered to compensate the dismissed manager for the moral and material prejudice suffered. The principle underlying this jurisprudence is the duty of loyalty between partners and the respect for the manager’s right to be heard before the termination of his mandate.

a. The Characterization of Vexatious Intent

A dismissal that is sudden, humiliating, or motivated by hostility rather than the company’s interest is abusive. Courts have sanctioned partners who required a manager, immediately after a general meeting, to hand over the business keys and documents and forbade him from entering the company’s premises (Cass. com., 1 Feb. 1994, no. 92-11171; Cass. com., 9 Nov. 2010, no. 09-71284). Similarly, sending a suspension letter prohibiting access to the registered office has been deemed vexatious (Cass. com., 17 Dec. 2002, no. 98-21918). Such conduct evidences a will to harm, which constitutes a personal fault by its authors (Cass. com., 13 Mar. 2001, no. 98-16197).

b. The Right to be Heard

Respect for the rights of the defense requires that a manager facing dismissal be placed in a position to present observations before the competent body. Although developed in relation to sociétés anonymes, this principle has been held applicable to SARLs as well (Cass. com., 26 Apr. 1994, no. 92-15884). Consequently, the manager must be informed of the contemplated dismissal and given an opportunity to justify himself prior to the decision (CA Paris, 2 Oct. 1997; CA Versailles, 25 Jan. 2007, no. 06-00440; Cass. com., 22 Oct. 2013, no. 12-24162).

That said, the partners are not required to state the grounds for dismissal in the convening letter. Nor must the manager be apprised of the grievances in advance of the meeting; what matters is that he be allowed to respond during the deliberations themselves and that the dismissal occur in a loyal manner (Cass. com., 23 Oct. 2019, no. 17-27659).

c. Special Situations

• Gross fault. Where the manager commits a gross fault, immediate dismissal may be justified. Nevertheless, even in this case, the manager must be permitted to present observations before the decision is taken; otherwise, the dismissal is abusive and entitles him to damages (Cass. com., 11 Oct. 2023, no. 22-12361, concerning an SAS but transposable to SARLs).

• Breakdown of negotiations. The abrupt termination of negotiations aimed at organizing a co-manager’s amicable departure has been held to constitute an abusive dismissal (CA Toulouse, 4 Oct. 2001).

• Disagreements between partners. Disagreement within the partnership may justify dismissal if it impairs the company’s functioning. However, even in such circumstances, the courts will inquire whether the revocation was executed in sudden and vexatious conditions. In a case where dismissal was motivated by partner disagreement, the Court of Cassation quashed a decision denying damages because the lower judges had failed to assess whether the circumstances of dismissal themselves were abusive (Cass. com., 29 Mar. 2017, no. 15-16778).

d. Practical Implications

While dismissal remains possible at any time, it must be carried out with fairness and procedural loyalty. A manager must be heard before the decision is taken, and partners must avoid abrupt, humiliating, or hostile measures that betray a will to harm. Failure to respect these standards converts a lawful revocation into an abusive dismissal, with the resulting obligation to compensate the manager.

4.7 Judicial Dismissal of the Manager of a SARL for legitimate cause

In addition to dismissal by the partners, the law provides for judicial revocation of a manager where the company’s interest so requires. Article L. 223-25 of the Commercial Code authorizes any partner—whether minority, equal, or majority—to petition the court for dismissal on the basis of a “legitimate cause.” This mechanism ensures that even partners without control of the company’s capital can safeguard the company against managerial abuses, incapacity, or misconduct.

a. Concept of Legitimate Cause

The concept of “legitimate cause” largely overlaps with that of “just cause”, but its scope may be broader. Unlike just cause, which often presupposes misconduct or mismanagement, legitimate cause may also derive from circumstances that reveal the manager’s incapacity or unfitness to act in the company’s best interests. For example, a manager of a real estate civil company was dismissed on grounds of advanced age and vulnerability, which impaired his ability to manage effectively (CA Paris, 4 Apr. 1997, Dr. soc. 1997, no. 177).

By contrast, the Court of Cassation has clarified that not all personal disputes between partners amount to legitimate cause. In one case, allegations of misappropriations by a brother-manager were rejected because the conduct related more to private disputes than to the company’s management, and had no significant impact on its financial situation (Cass. com., 10 July 2007, no. 06-13520).

b. Illustrations of Judicial Dismissal

Case law provides numerous examples of situations where legitimate cause justifies judicial revocation:

• Self-interested or abusive conduct. A manager who withheld accounting documents, unilaterally transferred the registered office, and manipulated a capital increase to consolidate his control was dismissed judicially for acting in contradiction with his mandate (Cass. com., 7 June 2011, no. 10-17792).

• Endangering the company. The courts may intervene urgently, even in summary proceedings, where the manager’s behavior places the company in immediate danger (CA Pau, 6 Mar. 2003, Dr. soc. 2003, no. 149).

• Abandonment of functions. A manager who abandoned his role, left his residence, and diverted company funds using its chequebook was dismissed by the president of the commercial court ruling in summary proceedings (Commercial Court of Paris, 18 June 1974, Bull. inf. soc. 1974, 596).

c. Procedural Aspects

Although any partner may petition for dismissal, the action must respect certain procedural rules. The manager whose revocation is sought must be summoned, as must the company itself and all the partners, in order to ensure that the decision binds the entire partnership (CA Paris, 26 May 2002, RJDA 2/01, no. 174). Nevertheless, it has been held that it is not always necessary to summon all the partners for the court to decide: a judgment concerning a civil agricultural company (Cass. com., 15 Jan. 2013, no. 11-28510) has been interpreted as applicable to SARLs, recognizing the priority of protecting the company’s interest.

d. Practical Implications

Judicial dismissal provides an essential safeguard for minority and equal partners, ensuring that they are not left powerless in the face of managerial misconduct, incapacity, or abuse. Legitimate cause encompasses both serious fault and broader considerations such as incapacity or conduct incompatible with the company’s interest. However, the courts remain vigilant to prevent the judicial route from being used merely as an extension of personal disputes between partners.

5. Publication and Effects of the Cessation of the SARL Manager’s Functions

The cessation of a manager’s functions in an SARL produces effects both internally and externally. Internally, it entails obligations of reporting and loyalty towards the company. Externally, vis-à-vis third parties, the cessation is enforceable only once the requisite publicity has been completed in the Trade and Companies Register (RCS). French case law emphasizes that failure to respect these formalities creates significant risks both for the company and for the former manager, particularly in relation to third-party reliance, corporate governance, and personal commitments.

5.1 Enforceability Against Third Parties

According to Article L. 210-9 of the Commercial Code, the company cannot invoke the cessation of functions of a manager against third parties unless the change has been duly published. The only exception is where the company can demonstrate that the third party had personal knowledge of the change. Thus, a bank was held liable in damages for relying on the instructions of a partner who claimed that the manager had been dismissed, when that information was immediately contested with serious supporting evidence (Cass. com., 16 Jan. 2001, no. 98-11308). The resigning manager himself may carry out the publicity formalities.

5.2 Duties of the Outgoing Manager

A manager who ceases to hold office during the financial year must prepare a management report covering the period during which he exercised his functions. This report must be presented at the shareholders’ meeting convened to approve the accounts for the relevant financial year. Even after leaving office, the manager remains bound by a duty of loyalty toward the company.

5.3 Judicial and Administrative Aspects

• Challenge before the registrar. The validity of a dismissal cannot be contested before the registrar of the RCS. Only the courts are competent to adjudicate the legality of the dismissal and, if necessary, to order the removal of the new manager’s registration (CCRCS, opinion no. 2017-009). However, the registrar may refuse to register a new manager if the appointing resolution does not indicate the voting results.

• Banking secrecy. Once his functions have ceased, the former manager no longer represents the company. Banking secrecy can therefore be asserted against him, even with respect to documents concerning periods during which he was in office (Cass. com., 16 Jan. 2001, no. 98-11744).

• Statutory manager. When a “statutory manager” ceases to hold office, the registrar is not required to demand rectification of the articles, unless the articles themselves provide for substitution of the manager’s name (CCRCS, opinion no. 1999-069).

• Vacancy in management. Where a resigning manager fails to facilitate his replacement, the president of the commercial court may, by order on petition, appoint an ad hoc representative to convene a general meeting for the purpose of designating a new manager (Cass. com., 19 Dec. 2006, no. 05-17671).

• Falsified appointment. Once the appointment of a manager has been duly published, the company is bound by the acts performed by that manager, even if the signature of the appointment minutes was forged. It is the company’s responsibility to verify the authenticity of published information (Cass. civ., 3rd ch., 26 Oct. 2023, no. 21-17937).

5.4 Specific Consequences

• Passage from majority to minority management. Where a majority manager mandates a third party to perform the necessary steps to become a minority manager and the formalities are not completed, he cannot automatically claim damages for loss of social protection, absent proof of a causal link (Cass. civ., 2nd ch., 11 Sept. 2008, no. 07-20857).

• Removal of the manager’s name. The partners may, by ordinary resolution, amend the articles to remove the name of a statutory manager following cessation of functions (C. com., art. L. 223-18, para. 2).

• Suretyship obligations. A manager who has personally undertaken commitments as a guarantor (“in view of his commercial interests”) remains bound even after resigning and transferring his shares, unless the suretyship is expressly limited to debts incurred during his mandate (Cass. com., 8 Jan. 2002, no. 98-19449).

• Striking-off of the company. The ex officio striking-off of an SARL from the RCS does not terminate the manager’s mandate. He may still act in the name of the company, including procedural acts (Cass. com., 4 Mar. 2020, no. 19-10501). Moreover, he remains obliged to file the company’s accounts for periods prior to cessation of activity, even after striking-off (Cass. com., 24 June 2020, no. 18-14.248).

5.5 Practical Implications

The cessation of a manager’s functions has consequences that extend well beyond the partners’ internal decision. Compliance with publicity formalities is essential to ensure enforceability against third parties, to protect the company from liability, and to delimit the rights of the former manager. Failure to follow these rules can expose both the company and its partners to litigation and financial risk.