Over the past year, during the coronavirus pandemic, the need for digitalisation has become increasingly clear, including within notarial law: from digital general meetings to formations and registrations. But now there’s more.
Since 1 August 2021, notaries have been able to handle the formation of a legal entity using digital tools. The execution of the memorandum of association takes place via electronic signature during a video meeting with the notary. The founders can, however, be asked to attend in person in order to protect the public interest, in the case of suspected fraud, for example. The digital formation is not associated with any additional costs and the substantive requirements of the memorandum of association remain the same.
This means that the following legal entities can now be formed digitally: private companies, cooperatives, limited companies, international non-profit organisations and foundations.
This change is the result of the implementation of European Directive 2019/1151 concerning the digitalisation of company law. Other working points are the digital registration of branches, the online submission and consultation of company information and documentation and, from 2023, cross-border conversions of companies and mergers.
Digital formation fits within the principle of freedom of establishment of enterprises in the European Union and is intended to make it easier for potential founders and start-ups to establish a company (in another country).
Digital formation is already possible for a number of business types, or was already being used in practice by notaries:
- the establishment of non-profit organisations, partnerships, general partnerships and limited partnerships can be carried out without formality. The memorandum of association is then uploaded to the digital platform of the e-registry.
Please note: if this kind of legal entity is established in this way through a notary, all future actions (e.g. changes to the articles of association) will also need to take place before the notary.
- Most notaries work flexibly with documents, e.g. through digital proxies, in which one founder can represent the other founders in the memorandum of association, for example.
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