Transformation Commissioner: Legal and Practical Guide 2026

This guide is written for expats and foreign founders by a French CPA, an English-speaking accountant in Paris, with practical focus on accounting in France, French corporate tax, business setup in France and French payroll.

A transformation auditor is appointed when a company that has no statutory auditor converts into a joint-stock company (SAS, SASU, SA, partnership limited by shares). He assesses the value of the assets making up the company's property and any special benefits, then certifies that equity is at least equal to the share capital. His report must be filed with the commercial court registry at least eight days before the meeting.

The transformation commissioner is a professional appointed to act when a company changes its legal form. His mission has two components, set out in two distinct provisions that are often confused:

1. Article L. 224-3 of the Commercial Code: assessing, under his own responsibility, the value of the assets making up the company's property and any special benefits;
2. Article R. 224-3 of the Commercial Code: certifying that equity is at least equal to the share capital.

It is this second, regulatory component that grounds the certificate expected by the shareholders and by the registry. Many online sources attribute it to article L. 224-3: that is inaccurate, the statutory article only covers the value of the assets and the special benefits.

Article L. 224-3 of the Commercial Code provides:

"Where a company of any form that has no statutory auditor transforms into a joint-stock company, one or more transformation auditors, tasked with assessing under their responsibility the value of the assets making up the company's property and any special benefits, are appointed, failing a unanimous agreement of the shareholders, by court decision at the request of the directors or one of them."

Two practical consequences are often missed. First, the default route is judicial: it is the unanimous agreement of the shareholders that allows them to appoint their professional directly. Second, the same article adds that "failing express approval by the shareholders, recorded in the minutes, a transformation carried out in breach of this article may be annulled": the minutes must therefore contain a resolution expressly ruling on the valuation of the assets and on the special benefits.

The mission is required during any transformation of a company taking the form of a joint stock company, that is to say mainly:

The decisive test is therefore not the destination form alone: it is the pair "starting form / presence of a statutory auditor". A company that already has a statutory auditor never appoints a transformation auditor, its own auditor issues the required report.

Two misconceptions to correct. (1) An SA converting into an SAS does not appoint a transformation auditor: its own statutory auditor certifies that equity is at least equal to the share capital (article L. 225-244). (2) Converting an SAS into an SARL does not call for a transformation auditor either: if the SAS has a statutory auditor, he issues the report under article L. 225-244; if it has none, the French national auditors' body (CNCC) takes the view that the obligation in article L. 225-244, paragraph 1 does not apply, since there is no auditor in office. No provision entrusts that certificate to a chartered accountant.

The continuity of the legal personality#

The transformation is a capital operation but which does not create a new legal entity: it only modifies the legal form. The company keeps its SIREN number, its contracts, its receivables and debts, its employees, and its creation date. Only the operating rules change.

If the company already has an auditor#

If the company undergoing conversion already has a statutory auditor (because it is required to or appointed one voluntarily), no transformation auditor is appointed: its own statutory auditor issues the report required by its starting form (article L. 223-43, paragraph 3 for an SARL, article L. 225-244 for an SA or an SAS). There is no additional professional to appoint.

If the company does not have an auditor#

If the company has no statutory auditor (a common situation for small SARL and EURL) and converts into a joint-stock company, a transformation auditor must be appointed. Article R. 224-3 refers to article R. 225-7, the provision governing contribution auditors: the professional is chosen among registered statutory auditors or among the experts listed by the courts, with no territorial condition. He may be assisted by experts of his choice, whose fees are borne by the company.

Appointment follows one of two routes:

1. By unanimous agreement of the shareholders: the usual route in practice. Article L. 224-3 provides for judicial appointment "failing a unanimous agreement of the shareholders", so unanimity is the condition for choosing your own professional. A simple majority is not enough;
2. By court decision: failing unanimity, the appointment is requested from the president of the commercial court, ruling on application, at the initiative of the directors or one of them.

The transformation auditor is subject to the incompatibilities of article L. 821-31 of the Commercial Code: he may not take, receive or keep, directly or indirectly, an interest in the company concerned, and the personal, financial and professional links incompatible with the engagement are set out in the profession's code of ethics (article L. 821-36). That is the first point to check when a single firm offers to handle everything.

Step 1 – Acceptance and engagement letter#

The transformation commissioner sends a mission letter specifying the scope of his work, the deadline for submitting the report and his fees.

Step 2 – Equity Analysis#

The professional examines the balance sheet of the company on the date closest to the transformation (intermediate balance sheet or last approved balance sheet). It checks:

• That equity is positive;
• That the equity is at least equal to the share capital mentioned in the future statutes of the transformed company;
• The quality of assets and the existence of possible unrecognized liabilities (provisions for risks, ongoing litigation, off-balance sheet commitments).

Step 3 – The transformation commissioner's report#

At the end of his work, the auditor prepares a written report intended to be presented to the meeting of shareholders called to vote on the transformation. This report includes:

1. The description of the mission and the scope of the work;
2. The balance sheet closing date used as a reference;
3. The description of the procedures carried out (review of significant assets, off-balance sheet commitments, known disputes, examination of any special benefits stipulated);
4. The conclusion, in two steps: the observations or absence of observations on the value of the assets making up the company's property and on the special benefits, then the auditor's position on the amount of equity compared with the share capital.

Three conclusions are possible, and it is worth knowing them before launching the operation:

Two regulatory deadlines not to be missed. The report is kept at the registered office at the shareholders' disposal at least eight days before the date of the meeting called to rule on the conversion (article R. 224-3 of the Commercial Code), or attached to the draft resolutions in case of a written consultation. It is also filed with the commercial court registry at least eight days before that same date (article R. 123-105 of the Commercial Code). Where the same professional issues a single report also covering the engagement under article L. 223-43, the CNCC recommends filing it at the registered office fifteen days before the meeting, to comply with the usual notice periods applicable to an SARL.

If equity is lower than the share capital: contrary to what is often written, the operation is not "legally impossible". Under article L. 224-3, the CNCC legal studies committee takes the view that an SARL-to-SAS conversion decided even though the report does not certify that equity is at least equal to the share capital is irregular but not void, provided the shareholders approved the valuation of the assets and any special benefits and those approvals are recorded in the minutes. For an SA, or an SAS with a statutory auditor, article L. 225-244 requires the decision to be taken on a report certifying that equity is at least equal to the capital: overriding it is likewise an irregularity, which the statutory auditor flags to the meeting in an ad hoc communication, without nullity being incurred, since no express provision imposes it. The practical conclusion is the same either way: better to set the capital of the converted company at the actual level of equity, or to recapitalise before the meeting. This is also distinct from the capital-restoration obligation (articles L. 223-42 and L. 225-248 of the Commercial Code) triggered when equity falls below half the share capital.

Step 4 – Extraordinary general meeting vote#

The report is made available to the shareholders before the extraordinary general meeting (EGM) that rules on the conversion. The majority rule is not that of the original form, it depends on the destination form, and this is the most common mistake on SARL files:

The SARL-to-SAS trap. Because the SAS has no minimum capital and no imposed governance, many directors expect to vote the conversion by a two-thirds majority, like an ordinary amendment to the articles. That is wrong: article L. 227-3 requires unanimity, including from a silent or absent minority shareholder. A shareholder who did not consent can challenge the operation.

One further condition applies to an SA changing form: it must have at least two years of existence and have had the balance sheets of its first two financial years approved by the shareholders (article L. 225-243). That condition does not apply to the SAS, which article L. 227-1 expressly excludes.

Finally, the minutes must record an express approval of the valuation of the assets and of the special benefits: shareholders may only reduce that valuation unanimously, and a conversion carried out in breach of article L. 224-3 may be annulled.

Step 5 – Legal formalities#

After a favourable vote of the EGM:

• Drafting and signing of the new articles of association;
• Publication of a conversion notice in a medium authorised to publish legal notices;
• Filing of the amendment formality on the INPI one-stop shop for business formalities: since 1 January 2023, paper forms such as the M2 are no longer used, the declaration is made online only, and the one-stop shop then forwards it to the registry. Usual attachments: new articles, auditor's report, EGM minutes, proof of publication of the legal notice;
• Update of the Kbis by the registry and publication in the BODACC.

The transformation of SARL into SAS is by far the most common in the practice of French SMEs. It is motivated by:

• Greater statutory flexibility: the SAS allows you to freely organize governance, issue preferred shares, and adjust approval and pre-emption clauses.
• Facilitating the entry of investors (business angels, venture capital funds) who prefer the SAS.
• Possibility of issuing BSPCE (Business Creator Share Subscription Warrants) to motivate employees and key collaborators.
• Possible dissociation between voting rights and dividend rights.

The mission of the transformation commissioner takes on its full meaning in this context: it secures the operation, reassures future investors and guarantees the legal compliance of the transformation vis-à-vis third parties.

During a transformation, all current contracts (commercial leases, customer contracts, supplier contracts, employment contracts) are automatically transferred to the new legal form without the need for an amendment. Legal personality is continuous.

However, it is recommended to check the change of control or legal form clauses in the most important contracts (leasing, commercial lease, strategic partnerships) to anticipate any prior agreement from the co-contractor.

The engagement requires a statutory auditor registered on the list maintained by the High Authority for Audit (H2A). Hayot Expertise, a member of the CRCC de Paris, carries out the transformation audit and the accompanying tax analysis, in Paris and throughout France.

For the exact scope of the engagement, indicative fees and timelines, see our transformation auditor service in Paris.

Fees are freely set: no regulated scale applies, unlike some legal professions. They are negotiated file by file, and the gap between two quotes almost always comes from the same thing, the volume of procedures the balance sheet requires.

Three factors drive the fee far more than turnover does: an old closing date, which forces interim accounts to be prepared and reviewed; the presence of intangible assets whose value must be assessed; and the existence of special benefits granted to a shareholder, on which the auditor must take a position item by item. Conversely, a prepared file lowers the cost: final trial balance, general ledger, fixed-asset schedule, significant contracts and the draft articles available from the first exchange avoid the back-and-forth that inflates the invoice.

The firm's quote is set out on our transformation auditor service in Paris page.

The engagement is not territorial. Article R. 225-7, to which article R. 224-3 refers, selects the professional from among registered statutory auditors or experts listed by the courts, with no condition as to judicial district. A statutory auditor registered in France can therefore act for a company registered anywhere in the country, and the engagement is routinely handled remotely, since the evidence is accounting evidence.

Two points do depend on the address of the registered office: a judicial appointment, if the shareholders do not reach unanimity, is requested from the president of the commercial court of the registered office; and the report is filed with the registry of that same court, at least eight days before the meeting (article R. 123-105). The selection criteria are therefore registration on the list kept by the French High Authority for Audit (H2A), the absence of any incompatibility under article L. 821-31, and the ability to meet the calendar, which means starting three to four weeks before the target meeting date.