In the increasingly constrained landscape of wealth structuring, where tax efficiency is sought with even greater urgency as positive law becomes denser, there is a strong temptation to exhume ancient legal figures that have fallen into disuse, to give them new utility in service of contemporary objectives. The simple limited partnership (SCS), whose origins date back to an ancient practice of risk-sharing between investors and entrepreneurs, is one of those instruments that the evolution of wealth practices is bringing back into the spotlight today.

Codified in Articles L. 222-1 to L. 222-12 of the Commercial Code, the SCS is characterized by a rare functional duality in corporate law: the general partner, who is indefinitely and jointly liable for the company’s debts, exercises the effective management of the company; the limited partner, for their part, limits their role to a capital contribution and participation in the results, without any administrative power. This organic distinction, both structuring and atypical, underpins the possibility of a differentiated tax treatment of income based on its nature and the quality of the benefiting partner. In a context where the increasing intertwining of economic, tax, and succession objectives demands both rigorous and adaptable arrangements, the SCS emerges, in certain specific configurations, as a relevant vehicle for managing complex assets, provided it is handled with discernment and caution.

Written by Antoine Aufrand - Founder Hypérion Strategy — Partner Figen AI

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