Starting a business is exciting, but selecting the right legal structure is crucial to ensuring your operations are protected, efficient, and future-proof. In Lebanon, the Commercial Law offers several types of companies, but not all are created equal for every entrepreneur.
There are two main categories:
- Personal companies, such as General Partnerships and Limited Partnerships, these we typically not recommended due to the personal liability risks they carry.
- Capital companies, such as Limited Liability Companies (SARL) and Joint-Stock Companies (SAL), including Holding and Offshore companies, are generally safer and more adaptable to diverse business models.
So, which company type is right for you?
The answer depends on key questions:
- Is this a family-owned or investor-based business?
- Will operations be local or international?
- Are you in real estate, finance, or an industrial activity?
- What is the size and scale of the business?
- What are your tax obligations?
- And most importantly, what is your legal exposure as a director or board member?
Understanding these dynamics allows you to make informed decisions—not just legally but strategically.
Examples that Matter:
- For small or family-run businesses, a Limited Liability Company (SARL) is often ideal. It’s simple and low-cost, and liability is confined to the company itself. With Law No. 126 (March 29, 2019), it’s now possible to establish a SARL with just one partner, making entrepreneurship even more accessible.
- For larger projects—real estate, industrial ventures, or businesses open to investors—a Joint-Stock Company (SAL) is more suitable. These companies offer flexibility with capital, enable share transactions, and can bring in new shareholders. Their structure—composed of a Board of Directors and a Chairman—also supports more complex operations.
It’s worth noting that holding and Offshore companies are SALs by nature, governed by specific legal frameworks and limited to activities outlined in the Commercial Code.
Why Capital Companies Stand Out:
The legal personality of a capital company is separate from its shareholders or partners, which provides a layer of protection. This shields personal assets from business liabilities—a critical distinction from personal companies, where partners are fully exposed, legally and financially.
Of course, tax obligations vary and deserve a dedicated breakdown, which we’ll cover in a separate piece.
Bottom Line: Before jumping into business, consult with legal experts. At our office, we don’t just handle the paperwork; we advise you strategically to choose the company type that aligns with your vision, sector, and goals.
Let us help you build the right legal foundation for your business journey.