Are you a foreign company director planning to set up a business in France? Do you have many questions about administrative formalities or possible forms of company? Here’s the essential information you need to set up a business in France. We explain who is authorized to take such action, what legal forms are authorized and how to go about it in practice.
1 – Can a foreigner set up a business in France?
Foreigners are allowed to set up a business in France. However, certain rules must be observed.
Here’s what you need to know.
1.1 – Who can set up a business in France ?
Some regulated professions are reserved for French nationals, citizens of the European Union (EU), the European Economic Area (EEA) or countries that have signed a reciprocal agreement with France. If your activity is authorized in France, all you need to do is complete the personal formalities involved in setting up your own business, as well as the registration formalities.
1.2 – Setting up a business in France: specific procedures for foreigners
Foreign nationals wishing to set up a business in France are subject to formalities that depend on their place of residence and country of origin. Let’s take a look at the case of foreign nationals, i.e. citizens from outside the EU, Switzerland and the EEA. Let’s distinguish their situation according to their place of residence.
A – Foreign nationals from outside the EU, EEA and Switzerland, with future residence in France
Before arriving in France, foreign nationals must apply for a type D long-stay visa, which lasts from 3 months to one year. Once in France, further steps are required. They must then apply for either:a “talent passport” (a scheme designed to boost economic attractiveness);a temporary residence permit with the words “entrepreneur/profession libérale”, for a maximum duration of one year, followed by a multi-annual residence permit.
Please note that these formalities require you to justify your application and demonstrate the economic viability of your project. The self-employed are even required to show a minimum level of income. However, if you hold a residence permit, you can avoid this specific procedure. A.S PARTNERS can help you if you have any doubts about these procedures.
B – Foreign nationals from outside the EU, EEA and Switzerland, with no future residence in France
Foreign nationals who continue to reside outside France are not subject to any particular formalities apart from those associated with setting up the company itself. It was the law of January 2, 2014 that abolished the prior declaration that used to be made at the prefecture.
2 – What type of company should I set up in France ?
Several forms of company are conceivable for setting up a business. By understanding how each works, a foreigner wishing to set up a business on French soil can optimize the administrative, legal and tax organization. At A.S PARTNERS, our experts can also support you in this process.
2.1 – The liaison office on French soil
This is the lightest form of doing business in France. A liaison office has no legal personality. No tax declaration is required. This format is reserved for non-commercial activities. It is also known as a representative office. It is used for canvassing, prospecting, promoting a brand or products, but never for selling.
This is an ideal step for an entrepreneur wishing to study the local market and adopt his offer to France. The foreign parent company assumes all French expenses.
2.2 – The branch of a foreign company
This intermediate form corresponds to a company that is autonomous in its local operations, with a business, but still without its own legal personality. The branch therefore has neither assets nor share capital. In short, it is a local agency of a foreign company.
As a permanent establishment, the branch must comply with French tax regulations, both for VAT and for the taxation of income generated. However, the existence of tax treaties with certain foreign countries, including the USA, avoids double taxation. Note that you do not need to file a declaration for prior authorization with the French Treasury. However, the branch must register in France.
2.3 – The subsidiary of a foreign group, a company in its own right
This is the most complete form of company. Majority or wholly owned by a foreign company, the French subsidiary has legal personality. SARL (société à responsabilité limitée), SAS (société par actions simplifiée), SA (société anonyme), etc. – the choice is yours when it comes to legal status.
Setting up a company of this type in France means complying with all local accounting, social and tax regulations as a French permanent establishment. You should also be aware that certain sensitive activities require prior investment authorization, in accordance with article L.151-3 of the French Monetary and Financial Code.
3 – How to set up a business in France
You now know all the possible ways of opening a business on French soil as a foreign citizen. You’re also familiar with the formalities you’ll need to complete if you want to become a resident of France. But how do you go about setting up your own business? What support do you need, from the initial idea or project study, through to the legal and administrative set-up of your business?
3.1 – Determining the right business format for your entrepreneurial activity
For foreign entrepreneurs wishing to set up a business in France, one of the first steps in the project is to choose the right type of company. A.S PARTNERS, chartered accountants, can advise you on this preliminary study. It will guide you and explain the accounting, administrative and tax consequences of each solution. We draw up the company’s articles of association (SA, SARL, SAS, etc.), if required. He prepares all employment contracts under French law.
3.2 – Assistance with French administrative formalities
Foreign entrepreneurs must complete all the formalities required to set up a business in France, in addition to those specific to their foreign status. If you’re looking for public assistance to launch a business in France, the formalities can be equally complex.
A.S PARTNERS supports foreign companies in the administrative management of their project, taking charge of formalities and relations with the authorities. A.S PARTNERS can also help with the formalization of partners’ contributions, the legal drafting of a shareholders’ agreement or a legal announcement.
3.3 – Formalities for registering a foreign company in France
Here are the administrative formalities involved in setting up a business in France, for which we provide support to foreign managers from A to Z: registration in the Sirene register with the CFE in the case of a subsidiary or branch (permanent establishment);registration in the RCS (Registre du commerce et des sociétés) for a commercial activity, or in the RM (Répertoire des métiers) for a craft activity;domiciliation of a foreign company in France, whatever form it takes (allocation of an administrative address); formalities for hiring employees in France for all types of status (office, branch, subsidiary); formalities with the CNFE (national center for foreign firms) when hiring employees in France by a foreign company with no permanent establishment; registration with the SIEE (foreign company tax department) for a foreign company with no permanent establishment and no employees.
To set up a business in France, we recommend that all foreign entrepreneurs, at every stage of the project, be supported by professionals based in France. Contact A.S PARTNERS, an international accounting firm specialized in this type of service for foreign companies.
