Company registration in France

Until recently, France was considered an extremely bureaucratic country for starting and doing business. But after a series of successful reforms in France, conditions were created for the inflow of foreign capital, which the local public authorities have emphasized. Now it is much easier to enter the market, and this decision makes it possible to do business from the territory of a very prestigious jurisdiction. In addition to company registration in Paris, one should also pay attention to many other developed cities of this country: Marseille, Lyon, and Strasbourg.

Advantages of registering a company in France

The decision to open a company in France can provide access to the following benefits:

• the opportunity to operate in a country with a highly developed economy (2nd in Europe and the top 10 economies of the world);
• openness to foreign capital, innovation, and new technologies;
• availability of qualified workforce;
• state support of business, such as tax and other benefits, simplified procedure for obtaining residence permits for business people;
• high standard of living and means of doing business;
• availability of a large number of double taxation treaties.

Forms of doing business and legal presence in France

You can enter the French market through one of these forms:

• A limited liability company (SARL, the equivalent of an LLC) is a legal entity that can be founded even by a single member of any residency. The liability of the participants of this company is always limited solely to their contributions to the company. This company has no minimum share capital requirement, but its size must correspond to the types of activities the legal entity plans to engage in.
• A Joint Stock Company (SA) is suitable for medium and large businesses to attract external capital in large volumes. The company can be founded by at least seven legal and natural participants. The liability of company participants is limited solely by the value of their shares. The minimum share capital for this company is 37,000 euros, 50% of which must be paid at the time of registration. The shares of this company can be freely disposed of to third parties and listed on the stock exchange.
• A branch is an option suitable for a foreign company to enter the local market in a simplified manner and with minimal investment. Registration is required. The branch will not receive the status of a legal entity, and the parent company will be fully responsible for the results of its activities.
• A representative office is also suitable for a foreign company, as it allows operating legally in France without the right to conduct business. A representative office is established to promote products/services and to research local markets. Its activities, as in the case of a branch, are entirely the parent company’s responsibility.

How to register a business in France

The process of registering a company in France covers the following approximate steps:

1. Selection of the most optimal organizational-legal form.
2. Selection and reservation of a unique name for the future company.
3. Form a list of activities the company plans to engage in France.
4. Collection of information about the founders, including the parent company, beneficiaries, and company managers. This information will be entered into the Commercial Register and must be updated. Physical persons must provide copies of passports, as well as documents that confirm the residence address of each of them.
5. Drafting and execution of constituent and registration documents, including notarization.
6. ormation of the registration package and sending it to the Centre de Formalités des Entreprises for consideration. Entry of information about the new company in the French Commercial Register.
7. Registration for the payment of taxes and mandatory social charges.
8. Opening of corporate bank accounts.
9. Application for a license/permit (for certain regulated activities).

Legislation and regulatory environment

French law belongs to the continental law system and is entirely based on European standards. This means that foreign business people are free to pursue their business objectives in France but must conduct their activities strictly with compliance requirements. As a result, the local environment is favorable for starting and doing business. Furthermore, the presence of benefits and preferences greatly simplifies business conduct. Contact the lawyers at Prinancial for information about the industry in which you operate.

France’s tax system

The decision to open a company in France should be considered along with the following information about the country’s tax system:

• Corporate tax – 25%
• PIT – 45% (+ additional charges)
• VAT (turnover tax) – 20%
• Withholding tax (for non-residents) – (1) for legal entities: (i) dividends – 25% (ii) interest – 0% (iii) royalties – 25% (2) for individuals: (i) dividends – 12.8% (ii) interest – 0% (iii) royalties – 25%
• Capital Gains Tax – (1) corporate – see corporate tax (2) individual – 30% (+ additional charges possible).

How Prifinance lawyers can assist

If you have set your sights on registering a business in France, Prifinance lawyers are ready to assist you in every way possible. The specialists already have more than 11 000 successfully implemented projects connected with companies’ registration worldwide. Moreover, experts can apply this experience to launch and support another business project. Let us know the details.