Recently, the French Administrative Supreme Court (Conseil d’Etat) delivered a pivotal ruling on BSPCEs’ tax regime, a specialized form of stock options.

Understanding BSPCEs:

  • BSPCEs, known formally as bons de souscription de parts de créateur d’entreprise, aren’t a music genre or a trendy substance; they’re a unique stock option variant.
  • Introduced in 1998, BSPCEs offer a legally regulated framework for employee share ownership, aiming to foster loyalty and engagement in burgeoning companies.

Key Characteristics:

  • BSPCEs are exclusively available to unlisted limited companies or those with a market capitalization under €150m, contingent upon specific ownership criteria.
  • Issuing firms must have a registration history of less than 15 years, typically aligning with startups’ profiles.
  • Essentially, BSPCEs are tailor-made stock options crafted to suit the dynamics of startup environments.

Beneficiaries and Mechanics:

  • Employees or directors are the intended beneficiaries, receiving the privilege to convert BSPCEs into shares, contingent upon performance metrics and tenure.
  • The conversion price, set at grant time, enables potential gains linked to the company’s valuation upticks.

Our Tax Team

Pierre Bonamy, explains all the BSPCE mechanism and last updates in an article for the International Bar Association (IBA).