3.1 Foreign equivalents

The société en nom collectif (SNC) is France’s equivalent of the VOF. The SNC is a commercial partnership, irrespective of its actual purpose. The SNC is similar to the SCP, both being legal entities. The SNC may not be used for the exercise of liberal professions. By law, the partners are jointly and severally liable for the SNC’s debts.

Two types of société en commandite exist under French law: the société en commandite simple (SCS) and the société en commandite par actions (SCA). The latter resembles a company. It features characteristics of a French public limited company (société anonyme, SA), in addition to a number of SCS characteristics. The SCS is a limited partnership and a variation of the SNC. Like the latter, it is a legal entity. In addition to one or more partners which are jointly and severally liable for its debts, an SCS has one or more limited partners. Their external liability is limited to any unpaid part of their internal contribution obligation. A limited partner may not perform any act of external management (gestion externe), not even on the basis of a power of attorney. In the event of prohibited interference with management, the limited partner will be jointly and severally liable for any and all resulting obligations of the SCS. Depending on the number and importance of the infringements, the court may also hold the limited partner liable for other SCS debts.

The German equivalent to the Dutch VOF is called offene Handelsgesellschaft (OHG). This is also a commercial partnership. A partnership aimed at conducting a commercial business under a joint name (and without limited partners) is an OHG. No full clarity exists as to the exact meaning of the requirements ‘joint name’ and ‘commercial business’. Generally, commercial business means a business other than a business connected to the exercise of a liberal profession. Also, the term ‘business’ refers to a full-fledged business, not just incidental business activities such as projects, nor ‘civil’ activities such as mere investment management. A partnership aimed at exercising commercial business activities (less than a full-fledged business) or civil activities other than the exercise of a liberal profession may opt for OHG status by registration of the partnership as such. The name of an OHG must contain an indication of the type of partnership concerned (e.g. ‘OHG’). The legal characteristics of the OHG are almost identical to those of the Auβen-GbR discussed above. In fact, a number of provisions in the German Commercial Code regarding the OHG are applied by analogy to the Auβen-GbR. The similarities include the combination of legal entity status and joint ownership, as well as the regime for partner liability.

German law features the Kommanditgesellschaft (KG) and the Kommanditgesellschaft auf Aktien (KGaA). The latter is similar to a company. It features characteristics of the German public limited company (Aktiengesellschaft, AG), in addition to a number of KG characteristics. The KG is a limited partnership and a variation of the OHG. Like the latter, it combines legal entity status and joint ownership. Like in France, the external liability of the limited partners of a KG is limited to any unpaid part of their internal contribution obligation. A limited partner may not perform acts of management, unless the partners have agreed otherwise. Furthermore, a limited partner cannot be given the authority to represent the KG except in the form of a power of attorney. The exercise of management duties by a limited partner will not as such result in personal liable for the KG’s debts.

England makes no distinction between civil and commercial law. The English partnership, already discussed above, can be regarded as the equivalent of both the maatschap and the VOF. Equivalent to the Dutch CV is the English limited partnership. Like the English general partnership, the limited partnership is available for all business activities and lacks legal entity status. A limited partner’s liability is limited to the outstanding amount of his contribution obligation. He may not participate in the management of the partnership business and has no power to bind the firm (but he can be given a power of attorney). The exact scope of the prohibition to interfere with management is unclear. A list of powers not covered by the prohibition is currently being proposed for private fund limited partnerships (PFLPs), a special type of limited partnership expected to be introduced shortly. A limited partner interfering with management will be liable for the partnership’s debts incurred during the time of the infringement.