France is ready and waiting for you…
Are you seeking the perfect destination to form a company? France may just be the right place for you! Whether you are already familiar with France and hoping to move there, or you’re simply trying to find a country that can work in favorable ways for you to establish a business abroad. Aside from the croissants, romance and iconic monuments, France is an exceptional choice for business. We will tell you why and how to set up a company there.
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How Can Our French Partners help you?
If you’re considering opening a business in France, don’t go it alone. At Lexidy France, we have a team of experienced lawyers who specialize in helping businesses navigate the legal and regulatory landscape of France. With their guidance, you can avoid costly mistakes and ensure compliance with local laws while staying focused on growing your business. Contact our French Partners today to learn how to get the best-tailored help to unlock the full potential of the French market and achieve your business goals.
Here are the steps that lawyer can help you with:
Choosing the right legal structure: A lawyer can help you understand the different types of business structures available in France, such as a sole proprietorship, partnership, or limited liability company, and help you choose the one that best suits your needs.
Preparing and filing the necessary documents: Your lawyer can help you prepare and file all of the necessary legal documents, such as the articles of incorporation or partnership agreement, and ensure that they are completed correctly.
Registering your company: Your lawyer can assist you with the registration process by ensuring that all the necessary documentation is in order and submitting it to the appropriate authorities.
Complying with laws and regulations: A lawyer can help you understand and comply with all of the relevant laws and regulations that apply to your company, such as labor laws, taxes, and health and safety regulations.
Providing ongoing support: A lawyer can also provide ongoing support and guidance as you continue to grow and develop your company.
Steps to set up a company in France
You must open a business bank account and deposit a required amount. Although SARL, EURL and SA structures only require a 1 EUR minimum, you’ll need to deposit more than this in the account to start. Deposit 4,000 EUR and once your business is registered you will be able to withdrawal your money and use it as working capital.
Since the COVID pandemic, it has become possible to open an account remotely.
In France you are legally obligated to formally announce the opening of your new business. You should publish your announcement in an authorized newspaper or business publication. This formality is your company’s public introduction into the French business world.
The Centre des Formalités des Entreprises can help you understand the French business regulations and how to set up your business. The process differs slightly depending upon each business structure and category.
To incorporate your French company, have the following documents prepared:
- Completed application form
- Certified copy of passport (for each shareholder/director if applicable)
- Proof of residency
Next your documents will be sent to:
- The National Institute of Statistics and Economic Studies (INSEE), which will register your company with the national business directory.
- The Centre des Impôts, or tax office
- The Greffe du Tribunal de Commerce, commercial court
If you have employees, you will also need to inform the social security office to ensure you’re paying the right amount of pension and labor payments; along with the Caisses Sociales and Inspection du Travail and the Centre des Formalités des Entreprises or Chambres des Métiers.
Once you’ve opened your bank account and sent your documents to the appropriate registered offices, you will wait for your ‘Extrait Kbis’ (the certificate of incorporation). Along with this you’ll be assigned a SIREN number, a 14-digit unique code that serves as your company ID number. This will be written on all your official business documents, invoices and website. The activities of your business will be identified by an APE (Activite Principale de l’Entreprise) or NAF code.
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Why France is a good place to open a company?
France has one of the strongest economies in the European Union and the world. Setting up a business or forming a company in France allows you access to the robust French market and greater EU. This alone is advantageous in a multitude of ways. Along with the powerful economy, it is an exceptionally easy place for foreigners to open companies. In fact, the World Bank names France one of the easiest countries to do business in. This is due to the quick timeframe to form a company and the many types of incorporations available. Plus, there is no residency or citizenship requirement to open and operate a French company.
Notably, the French population is highly education and skilled, meaning you’ll have a strong talent pool to hire from. Also, as a popular place for tourism and travelers there is more potential to increase brand awareness in France.
Types of Companies in France
France has several company structures to fit all types of businesses and activities. This is a big attraction to foreign investors. Choosing the best option for you depends on several factors such as, your intentions for opening a business in France, your business plan, the amount of investment you have and whether you plan to live in France or not. Lexidy can help you determine the best route with all information considered.
Here is an overview of French company structures:
SARL (Societe Anonyme a Responsabilite Limitee): adequate to an LLC. The most common type of company and arguably the easiest to set up.
- 1 EUR minimum share capital
- 1 member to form
- shareholder(s) are liable only for their contribution of capital
SA (societe anonime): a joint stock company; great option for major businesses; commercial in form
- 37,000 EUR minimum share capital
- 2 shareholders to form; or 7 shareholders if listed on the stock exchange
- Board of Directors is required
- Must appoint a statutory auditor
SAS/SASU (societe par actions simplifiees): this is a simplified joint-stock corporation; Ideal for foreign investors who do not want to become resident in France; statutory freedom
- 1 EUR minimum share capital
- Typically 2 shareholders, but 1 works to form
- Must appoint a chairman
EURL (Enterprise Unipersonnelle a Responsabilite Limitee): one person company with limited liability; entrepreneurs personal assets are protected; great for small-scale projects
- 1 EUR minimum share capital
- 1 shareholder
- Management can be someone other than the sole shareholder
SNC (societe en nom collectif): is a commercial partnership; generally a family-run company
There is also the option to create a Branch Office or set up a Subsidiary company in France.
If you’re an individual looking to open a small business, there is another option for you. As a micro-entrepreneur the process is simplified. Open a micro-enterprise not as a legal business structure, but a tax status. The person operating the micro-enterprise must file as a self-employer Entreprise individuelle (EI). Tax wise this can be a great option for smaller businesses with a pay as you go approach. No need to open a business account, just a designated personal account will suffice. The downside is your personal assets won’t be protected as they would by establishing a SARL for instance.
Taxation for Companies in France
We highly recommend connecting with a French accountant. Some company structures even require this. Lexidy has you covered! A French accountant can help you navigate the foreign tax system and ensure you reap the benefits of double tax agreements which may exist between your home country and France. As well as tax deductions and exemptions. Accountants can support you in matters of VAT returns and payroll and general financial planning for your company.
Currently, the corporate tax rate is set at a rate of 28%. While the value added tax (VAT) is set at 20%, though specific produces may qualify for reduced rates.
Learn more about how to open a company in France
We are here to help — that’s what we’re best at. Our Lexidy — Paris office has French and English-speaking experts. We can advise on a wide range of legal matters, including but not limited to Corporate, Immigration, Tax, Compliance and Real Estate.
¨We will be with you each step of the journey.¨
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