Setting up a company in France

Setting up a company in France costs €4500 + VAT.

What do you need to know before opening a company in France?

If you want to start a business in France, you must have a residence permit or be an EU national. You may need qualifications or diplomas recognised by the French authorities. You will then need to study the market, draw up budget forecasts and financial plans and, if necessary, look for funding.

Why start a business in France?

France is a very business-friendly country, with one of the largest markets in Europe and access to the European single market. Paris, the capital of France, is a major European financial centre. France also has a talented workforce, innovative business leaders, high-quality transport infrastructure and strong intellectual property protection. France is an industrial powerhouse and, despite a decline in overall output, manufacturing remains one of the largest sectors of the economy. The country is home to leading car manufacturers (Peugeot and Renault) and the world’s leading aircraft manufacturer (Airbus).

A business-friendly environment and a highly educated workforce make it an attractive place to do business. France is also one of the most visited countries in the world and its cultural influence is widely recognised.

 

Currently, different types of business forms can be set up in France:

– French public limited company (société anonyme - SA)

To form a French limited company, you need at least seven shareholders. The founders may be natural or legal persons. The initial share capital is €37,000 to set up a company in France. The capital is divided into shares and the liability of shareholders is limited to the size of their contribution.

– French limited liability company (société a responsabilité limitée - SARL)

This type of company may be set up in France by at least two shareholders and a maximum of 100 natural or legal persons. No minimum share capital is required. This structure is generally recommended for small and medium-sized companies established in France. Establishment of this form of company requires an annual meeting to approve the annual accounts.

– Simplified joint stock company (SAS)

Similar to a limited company, but more flexible and requiring only two shareholders to be incorporated in France. The chairman or president must be appointed by the shareholders. The introduction of this form of business requires an annual meeting to approve the annual accounts. Foreigners are advised to set up a SAS-type company as the director of the SARL must be resident in France.

How is a company set up in France?

Registering a company in France is more convenient than ever – once selected, we offer our services to clients remotely, with professionals sending all the documents. The registration itself usually takes 1-2 weeks.

The prospective entrepreneur will receive a questionnaire and a list of documents to fill in. We will liaise with the notary and, if necessary, ask you for further details.

SARLs and SASs – minimum share capital is €1, but banks require more than this to open an account.

Another popular type of company in France is a branch. However, this type of company is entirely dependent on the parent company, which must establish it by its own decision and file it with the French Companies Registry. Branches must carry out the same activities as parent companies and are a good choice for foreign companies wishing to operate in France for a longer period of time. The parent company has full control over the branch and is responsible for the liabilities of the French structure. Compared to a subsidiary, setting up a French branch is simpler and cheaper. Another advantage of a branch is that only income earned in France is taxable in France.

Setting up a company in France involves several types of taxes:

25

Corporate tax rate is 25%.

20

VAT rate is 20%.

30

Dividend income is subject to a flat tax of 30%.

Advantages:

The French government will continue to support the manufacturing sector to increase its competitiveness, with a stronger focus on technology and innovation and a strong entrepreneurial culture in the country. In addition to being one of Europe’s largest economies, France is also the sixth largest in the world. It has a large internal market and is a key bridge to the rest of Europe’s single market. Thanks to excellent infrastructure, well-developed telecommunications and technology, and access to one of the largest capital markets in the region, the French government has expanded its policies in recent years to continue to attract foreign interest and investment.

Thanks to excellent infrastructure, well-developed telecommunications and technology, and access to one of the largest capital markets in the region, the French government has expanded its policies in recent years to continue to attract foreign interest and investment.

LCPC aims to provide you and your business with high quality assistance. Setting up a company is one of the first steps in building your business, and we will help you along the way!

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