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The allocation of BSPCEs (Bons de Souscription de Parts de Créateurs d’Entreprise) to independent board directors: a small revolution for joint stock companies, a real breakthrough for the biotech world

Biotech 2 min
October 30, 2019

Biotech and medtech companies operate in an international environment where the composition of their governance bodies is a key criterion of credibility. As said by the President of France Biotech, Maryvonne Hiance: “bringing renowned scientists or entrepreneurs to their boards of directors is not a luxury, it is an essential tool of attractiveness.”

As part of the recent PACTE law of 22 May 2019, the French legislator has finally addressed the crucial need of biotech and medtech companies to be able to properly compensate independent board directors – most often very popular people of high international scientific background – by allowing companies to issue tax favorable « stock-options » (BSCPE) to independent board directors.

Until now, BSPCEs could only be granted to employees or corporate officers of joint stock companies (sociétés par actions) created less than 15 years ago and if listed, with a market capitalisation that does not exceed 150 million euros.

Over the past years, some start-ups have been paying their board directors through share warrants (bons de souscription d’actions). This practice was challenged in June 2018 by the AMF (Autorité des Marchés Financiers) which summoned companies that wish to grant warrants to their board directors to issue them at market conditions and certainly not free of charge or at price conditions that do not reflect their market value.

In the future, the allocation of BSPCE to independent board directors should therefore add to the attractiveness of French biotechs and medtechs.

Written by
Emmanuelle Porte
Emmanuelle Porte
As a Corporate partner in the Bird & Bird Life Sciences team in Paris, I mainly advise innovative companies financed by venture capital, in particular biotech/medtech, digital health, and wellness companies.
Sofia El Biyed
Sofia El Biyed
I advise our clients on a broad range of corporate matters, with a focus on private equity transactions and mergers and acquisitions.

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