Monte-Carlo, Monaco: - General Information

Geographical Location

Monaco is an independent sovereign state located at the foot of the Southern European Alps by the Mediterranean Sea. The Principality of Monaco borders with France and is 21 kilometres (13 miles) from Italy. With an area of approximately 500 acres, roughly 100 acres of seafront property, Monaco is situated at 43°44’ North Latitude and 7°25’ East Longitude. Monaco is one hour ahead of Greenwich Mean Time (GMT+1) and has 29,972 inhabitants, of which 5,070 are Monegasque, 12,047 French and 5,000 Italian. Over 100 nationalities are represented.

History

In ancient history, the Rock of Monaco was a shelter for primitive populations. History of Monaco itself started in the 13th Century. On the 10th of June 1215, the Genoan family of the Gibelins commenced construction of the present Prince's Palace. To attract populations, incentives were offered to newcomers. Territorial concessions and tax exemption were granted. The Grimaldi family dynasty commenced in 1297, over 700 years ago.

Monaco’s motto is "Deo Juvante" (With God's Help) and Catholicism is the state religion. Freedom of worship is upheld through the Constitution. The National Holiday is on the 19 of November.

Communications

Nice airport is approximately 30 minutes by car, or 10 minutes by helicopter via the Monaco Heliport. The telephone code is 377 and telecommunication services are state of the art. Monaco prints its own stamps.

Language

The official language is French, although Italian and English are widely spoken. The traditional Monegasque language, "le Monegł," is spoken amongst elders and is taught in all local schools.

Currency

The currency is Euros.

Climate

Benefiting from an ideal geographical location, the Principality of Monaco enjoys very mild winters and remarkably sunny summers. Average temperature is 16°C, 60 days of rain fall per year and an average of 7 hours of sunshine a day. Sea temperatures vary from 11°C in the winter to over 26°C in summer. Thanks to its Mediterranean climate, Monaco is a pleasant place to live all year round. Winter ski resorts are within one hour by car.

Education

Residents in Monaco, representing 108 different nationalities, can enlist their children in a variety of schools. The educational program and diplomas are recognised as in France. Monaco introduces English in Elementary school, and so is the traditional language "le Monegł" and the history of Monaco. Monegasque students have a 90% passing rate the French National Baccalaureate.

Culture

The vast number of cultural events hosted in Monaco each year encourages the appreciation of artistic disciplines. Reputable establishments such as the Rainier III Academy of Music, the Academy of Classical Dance and the Princess Grace Municipal Plastic Art School have educated international artists.

Sports The Louis II Stadium, inaugurated in 1985, hosts international football games and is home to the A.S. Monaco Football Team. The Stadium is equipped for a wide range of sporting disciplines, and also hosts international athletics competitions. The Rainier III Nautical Stadium is a recreational Olympic-sized swimming pool with a high diving board. The Monte-Carlo Country Club has 40 tennis courts and is one of the most important tournaments on the professional tennis circuit.

Grand Prix

The Monaco Grand Prix started in 1929, under the auspice of S.A.S. the Prince Louis II. It is largely thanks to the efforts of Anthony Noghes and Monegasque pilot, Louis Chiron, that the smallest European state hosts such an internationally renowned event. The first Grand Prix saw 16 contestants who ran 100 laps of the famous city circuit. In 1929 the average speed on the course was 80.194 km/h. Today the Monaco Grand Prix is recognised internationally, and the circuit now measures 3.367 kilometres. Contestants are required to complete 78 laps.

The Historical Grand Prix of Monaco is largely considered «a must» with auto sports enthusiasts. Organised every two years by the Monaco Automobile Club, this event sees numerous historical sports cars competing for this highly prized trophy.

Security

A climate of security reigns in Monaco Monte-Carlo making this prestigious setting even more appreciable. There exists one police officer for every 100 residents, and a system of 24-hour live video surveillance, spanning the entire surface area of the Principality, including the majority of residence halls. The Monaco police is amongst the most modern and efficient in Europe. Begging is non-existent, indecent clothing is prohibited and traffic laws are rigorously enforced.

Medical

The Principality attaches a great deal of importance to the quality of its health facilities:

The Princesse Grace Hospital

The Cardio-Thoracic Centre

The Haemodialysis Centre

Taxes

The main principal of Monaco's fiscal system is the total absence of direct taxation. There are a few exceptions to this principal:

French nationals who are unable to prove that they resided in the Principality for 5 years before October 31, 1962.

An entity receiving royalties or other income which relates to intellectual property rights such as the licensing and selling of copyrights, patents and trademarks. If however some tax has been deducted at source in another jurisdiction then the Monegasque authorities will give a tax credit against the amount assessed;

An entity involved in commercial or industrial activities 25% or more of whose income is from sources located outside of Monaco; and

A company incorporated in Monaco which holds 20% or more of the shares of a non-resident company will pay business profits tax on dividends received from the non-resident company (note that pure holding companies are not allowed in Monaco).

The rate of business tax is 35%, however, reduced rates apply to newly incorporated entities. A new trading entity with less than 50% of whose share capital is held directly or indirectly by other companies pays a reduced rate of business tax on its activities for the first 5 years after its incorporation:

0% payable in the first 2 years;

8.33% payable in the third year;

16.33% payable in the fourth year;

25% payable in the fifth year and the normal rate thereafter.

Apart from with France, the Principality has signed no other bilateral fiscal or tax treaties. Persons residing in Monaco (except French nationals) do not pay tax on personal income, on betterment or on capital. French nationals fall under two categories:

French nationals who can prove that they resided in Monaco at least 5 years before October 31, 1962 are subject to the same system as other nationalities.

Other French residents are subject to French income tax collected by the French administration.

Assets located in Monaco are subject to the following inheritance tax rates:

between direct line of descendent: 0%

between brothers and sisters: 8%

between uncles and nephews: 10%

between relatives: 13%

between non-relatives: 16%

There is no direct tax on companies apart from the tax on profits mentioned previously.

Fiscal stamps must be obtained for all official civil and judicial acts. In addition, all documents which could be produced as evidence in a court of law must be stamped in order to be valid. Stamp costs are either a fixed fee or depend on the format of the document or the values involved in the acts. Registration duties are collected for the registration of real estate transfers or change of ownership. The most commonly applied rates are as follows:

1% for leases, subscription or transfer of shares in a company

6,5% for the sale of real estate

7,5% for the transfer of goodwill, clientele or real estate

Business Licences

The practice of a commercial, craft or industrial activity or a service sector activity requires an authorization from the Principality of Monaco. The authorization is granted or refused according to the guarantees furnished by the applicant and the interest that the project presents for the economy of Monaco. In order to obtain an authorisation to establish a business in Monaco, the applicant must request an application form from the Direction de l'Expansion Economique, and duly return the dossier to the same service. There are a variety of different legal forms possible for setting up an economic activity in the Principality. For commercial enterprises, the following structures are available:

General Partnership (S.N.C.)

Limited Partnership (S.C.S.)

Limited Partnership with Shares (S.C.A.)

Monegasque Limited Company (S.A.M.)

Foreign corporations may also establish a branch or administrative office in the Principality.

Customs & Duties

Regulations concerning customs and currency exchange are the same in Monaco as in France. The two countries constitute a Customs Union creating complete freedom of trade. Although Monaco is tied to France within the framework of European Economic Community customs territory regulations, Monaco is not a member of the EEC.

Business Incentives

In order to encourage the creation of companies and to develop the scientific and technical research sector, the Principality offers certain fiscal advantages. In fact, these firms are eligible for tax breaks. A tax credit of up to 40 million French francs may be granted. All firms created in the Principality and subject to the company tax on profits are exempted from tax for the first two years and partly exempted for the third year.

Employment

Any person or company wishing to hire personnel must receive an authorisation to hire and must register the personnel with the Social Security Compensation Fund (Caisse de Compensation des Services Sociaux - CCSS) and with the Independent Pension Fund (Caisse Autonome des Retraites - CAR). Benefits include:

family subsidies for dependant children,

partial reimbursement of medical fees,

retirement pension.

CCSS contribution rates:

16,15% of the gross salary to be paid by the employer

0,05% of the gross salary to be paid by the employee.

CAR contribution rates:

7,05% of the gross salary to be paid by the employer

6,15% of the gross salary to be paid by the employee.

Additional contributions, similar to France, are also payable, such as unemployment insurance and in certain cases retirement pensions. On average the employer pays approximately 33% of gross salary paid.

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