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France Company Registration

Complete guide on France company registration with complete process, documentation, and tax details. Register your company today with our industry experts.

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One of the most densely populated countries of the European continent with high purchasing parity as per the population the French Republic has to offer a dynamic medium of trade and a flexible channel to exercise the business operations in its geographical boundary. 

france company registration

Be it a national resident or a foreign entrepreneur from any international location Business France welcomes each and every prospectus with warmth. 

The economy offers a vivid and wide range of skilled human forces with an ample amount of experience which helps to enhance one particular business. 

The Republic of France offers subsidies, incentivizes and appreciates the idea of both existing businesses and new start-ups. 

Why To Register a Company In France?

  • The process of establishing a business in France is fairly simple when contrasted with other countries in the EU. When compared to the EU, France is the only country to favor private sector investment over setting up a business by itself.
  • The French government provides a variety of perks and incentives to help companies to grow. For the protection of intellectual property, the nation is a signatory to accords like the TRIPS Agreement, which provides substantial protection for foreign intellectual property rights.
  • The nation provides adequate infrastructure and services for initiatives including energy, roadways, railways, ports, and other things.
  • With an educated and highly skilled workforce, the cost of manufacturing the goods lowers. Because of this, it is the most popular place for investors and entrepreneurs to launch a new firm.

Procedure for Company Registration in France

Procedure for Company Registration in France

A person who is attempting to complete the process of company registration in France must adhere to the following procedure:

1. Select an Appropriate Structure

In the first place, the person who is applying for company registration in France must select the appropriate structure for their business. It is based on the specific business needs of the entrepreneur. If the applicant plans to establish an entrepreneurial business then it’s best to select French LLC.

2. Check the Name on the Website of (the French Patent and Trademark Office) (INPI) and Commercial Court Registry-

The applicant must then confirm an original name in the following step. The name of the business should not conflict with any other names already existing French Companies already have and should not be offensive.
3. Create a Business Bank Account to deposit the company’s share capital
Later the applicant will need to establish a corporate account with a bank. There are a variety of banks, including BNP Paribas HSBC as well as Societe Generale which offer banking services for businesses. It is suggested to compare the services offered by all banks before selecting one.

4. Register at Centre de Formalités des Entreprises

When opening a corporate bank account, the bank account holder will need to sign up at the Centre de Formalités des Entreprises to obtain a company registration in France. All other requirements related to taxation and business will also be handled by this institution.

5. Release The Legal Notice of incorporation JAL Announces Legalese

The next step is that the applicant needs to make a legal announcement of establishment in the regional newspaper JAL Announces Legales. This procedure is required for a formal and public announcement of this company’s business to the business community.

6. Receiving the Identification Number

Once you have received the documentation, once the Centre de  Formalités des Entreprises receives the documents, these details will be made available for the Register National des Enterprise. Following this, the business will be issued the SIRET (System Informatique for the Repertoire of Enterprises) SIRET, SIRENE, and NAF (Nomenclature of Activities in France) numbers.

Eligibility Criteria for French Company Formation

Eligibility Criteria for French Company incorporation

The following eligibility criteria have been met for company registration in France:

1. Objects Clause

The object clause in the memorandum should state the purposes for which the company was created.

2. Information on Key Executives

The most important information regarding the executives should be disclosed while applying to register a company in France. Details about the shareholders’ names, the registration address, as well as other details would fall under this category. In addition to this, further shareholder-related information should be disclosed. This would comprise data pertaining to the visa.

3. Information on Directors

Information about the directors of the company has to be made available.

4. Minimum Capital

The minimum capital requirement will be determined by the shareholders of the AOA and could be as small as EUR1.

However, if the business is a French Public Limited Company, the minimum capital requirement is EUR37,000. A one-fifth portion of the capital authorized is due at registration time.

Documents Required for Company Registration in France

A firm must have the following paperwork in order to be registered in France:

  • The identification documents of the company’s shareholders have to be notarized and translated.
  • Information about the managers of the company, as well as their identification documents and appointment letters.
  • Appointment of Manager Document.
  • Information on the Founders of the Company includes their address, visa information, passports, as well as other information pertinent to the company.
  • Application Form for Registration and Fees.
  • Memorandum of Association and Articles of Association which must be notarized.
  • Board Resolution( If required)
  • Charter of the SARL
  • A declaration that the manager has no criminal convictions.
  • Forms for applications made available through the Trade Registrar.
  • The decision to launch the company was published in the National Gazette.

Corporate Tax in France

Every France company registration is required to contribute corporate tax. The following taxes will be applicable:

  • Corporate Tax in France is 33.33 percent. 
  • VAT charges in France is 20 percent. The VAT tax is an indirect tax that is imposed on all French company registration.
  • A withholding Tax is imposed on all dividends distributed in France. A, 25 percent of withholding tax is imposed on every business that distributes dividends. The new tax rate for withholding is effective from 1 January 2022.
  • Businesses must file their corporate tax returns before 30 April.
  • Businesses that invest in sectors of priority are exempted from tax obligations. These exemptions are valid for seven years.

Benefits of Company Registration in France

Benefits of Company Registration in France

The following advantages can be accrued to investors thinking of France Company Registration:

1. One of the Biggest Economies in the EU 

France is the second-largest marketplace for consumers in the EU and has 65 million buyers in the country up to the sum of a trillion per year. With 83 million visitors annually, the tourist sector is booming. France is the second biggest exporter of Food and Beverages and the foremost important exporter of pharmaceuticals.

2. Intellectual Property Protection 

France has ratified agreements like the TRIPS Agreement, which greatly protects the intellectual property rights of foreign nationals. All businesses that operate in France can use a common patent registration process that gives greater protection for patents in France company registration. This also provides international patent protection.

France is positioned as the 12th most effective country to register patents worldwide by the World Economic Forum. The French government has a strict policy of examining instances of IP infringements, and they charge a penalty of up to 7500 euros if anyone violates the rules.

3. Low-Interest Loans for Public Sector 

Public Sector France does provide loans with a low rate of interest. The low-interest loan could be up to EUR1.5 million for funding research and development projects of companies with:

  • Under 250 workers, 
  • Have less than EUR 50 million in annual revenues, and 
  • Have been operating for at least three years.

For non-listed resident businesses, options for equity investments are permitted. Credit insurance is provided to all companies in France for a nominal cost.

4. Tax Incentives Offered by the Government

There are a variety of tax incentives and other programs offered by the French Government. The interest rates on business loans for entrepreneurs from all over the world can be as low as 2 percent. When the investments are in one of the areas that are designated as a priority by the French Government, these businesses will be exempted from paying corporate taxes for seven years. 

Although the tax rate for corporate entities can be up to 34 percent in France and the net tax rate could be reduced to 9 percent if the investment is made in particular areas. Additionally, the government offers other social security benefits.

5. Excellent place to go in search for FDI

France has emerged as the most desirable place to invest Foreign Direct Investment, moving ahead of the United Kingdom. France has received more than a thousand FDI projects in 2020, and the highest investment is being made in the area of IT and software projects.

6. Good Infrastructure 

The country has adequate infrastructure facilities in the areas of transportation, energy ports, railway projects, and many other projects.

Types of Business Entities for France Company Registration

Anyone who wants to go through the procedure of France company Registration will need to select the appropriate business structure. 

The following are the various business structures in France that entrepreneurs can adopt:

French LLC

This type of entity is often referred to as SARL which is equivalent to a private limited company in France. This kind of business model is extremely popular with entrepreneurs operating small or medium-sized enterprises due to less availability of resources, including minimum capital requirements and easy incorporation procedures.

To operate this type of business the minimum requirement is only one director (who is not an entity of a corporation), and one shareholder. The minimum amount of capital for shares required is EUR 1. The minimum amount is set by the shareholders. The incorporation process of an LLC is a simple procedure. 

There are no restrictions on residency conditions for directors and shareholders in an LLC. They are not able to access the right to capital markets and their shares may be listed on the exchange for stocks.

There is a maximum of 100 shares that are permitted to be shareholders and only one type of stock is allowed to be issued. It is not possible to impose personal responsibility on shareholders. The manager is empowered to represent the company in court against third entities.

The bylaws of the company and the shareholder’s resolutions are the resolutions for meetings. Each year, the annual shareholder meeting must be held in order for the company’s financial statements to be approved.

Partnership

A partnership is an agreement between partners to share in the company’s profits. In a partnership-based company, the obligations, as well as assets belonging to the business are distributed between the partners.

There are a variety of partnership arrangements that can be created in France which are the equivalents of general partnerships (SNCs), Limited Liability Partnerships (SCSs), Civil Companies, Civil Real Estate Companies (SCIs), Economic Interest Groups (GEI), SCA, etc.

Simplified Joint Stock Company

This kind of business is suitable to establish holding companies registration due to its enormous flexibility for shareholders to design the company to meet their preferences. The company’s manager is an individual or a legal entity.

Shareholders have the power to decide the rights associated with their shares at any time. It must appoint an auditor upon the fulfillment of certain criteria. SAS is not able to conduct public offerings, which means that its shares can’t be listed on the exchanges.

There isn’t a specific organizational structure that applies to SAS other than the appointment of one company president who has the greatest authority in the business and exercises the most powerful powers when representing the company to other individuals.

The Company is identical to that of the French LLC. For this kind of company, it is required to have one shareholder, and one director and the minimum capital needed is EUR1. The total number of shareholders that may register with SAS is unrestricted.

Directors of companies can be appointed to run this kind of business. They must hold an annual shareholder’s meeting to approve their financial statements within six months after the close of the financial year that ended the year before. The management decision-making process must be made in France.

French Public Limited Company

This kind of company is typically intended for larger corporations since it permits the business to sell shares to the public market, as they require a substantial amount of capital. It’s a complicated procedure and is not recommended for incorporation on the first occasion in France.

The formation of a French private limited corporation will need a minimum share capital for a creation similar to an open-ended private limited corporation. The required amount for forming the French Public Limited Company is 37,000 euros. It must have at least 2 (and seven if it is traded publicly) shareholders no limit has been set on the number of shareholders.

The structure of management for a SARL is comprised of:

  1. A Board of Directors that has 3-18 members or
  2. An Executive Board that has five members, with an oversight board of 3-18 members.

If the capitalization of an SA is not more than EUR 150,000 A single individual has been authorized to exercise the authority from the Directorate. The business must provide the necessary capital. A certified auditor is required to oversee the audits.

There isn’t any personal obligation for the shareholder against the obligations and debts that the business has to meet. The common charter documents comprise bylaws, shareholder’s meeting resolutions, shares transfer registers, shareholder’s accounts, etc.

European Stock Corporation

A merger between at least two EU corporations can be formed into a European Stock Corporation. The minimal capital needed to establish this type of business can be EUR 120,000.

Branch Office

An office branch is an ongoing establishment that is not a separate legal entity from the parent business. The offices are created at the company registration in France. The majority of the control over the branch office comes from foreign shareholders. The parent firm is liable for all obligations of the branch offices. There is no required minimum capital investment to open a branch office.

Representative Office

The representative office (bureau of representation) serves as an additional office for an overseas parent company in France that plans to establish a presence in France. It is not an independent entity from the parent company.

The function of the official representative is to monitor the regional French market to identify business opportunities and conduct market research promotions and marketing activities, with no trading intention.

The representative office isn’t permitted to trade or contract for the company that is a parent. It’s only a point of contact that allows potential customers and associates to get details about the parent foreign business through the office.

The creation of an official representative is the initial step towards the formation of a subsidiary or branch office within France. The representative office must select a representative that must be a resident of France to oversee the activities of the Representative Office in France.

The documents needed include an official certificate of Incorporation, Articles of Association of the parent company, a board resolution for the establishment of an official representative in France passports, and other identity documents of the person who registers for the representative office in France.

Conclusion

Branch companies are most often used to make investments in France in a long-term manner and keep a watch on the day-to-day operations because the branch has no separate legal identity. A liaison office can be used for investors from abroad who are working with France temporarily.
For any queries, reach out to our experts at ODINT Consulting. 

FAQ’s

The most suitable type of business for the registration of a company in France is a French LLC. This type of business structure offers the advantages that come with the limitation of liability. In addition, professionals utilize the company to launch an entrepreneurial venture.

Generally, it takes around two weeks to establish a business in France.

The answer is yes, French businesses do not need resident directors. Directors can be of any nationality.

The registration procedure in France is completely carried out on the internet.

The French Public Limited Company (SA) has 3 directors and at least 7 shareholders. The shareholders need not be French nationals.

A Simplified Joint Stock Company or a French LLC may have an initial capitalization of 1 EUR. A minimum of 37,000 euros are needed to establish a SA, or French Public Limited Company (SA).

French businesses are permitted to employ foreign citizens. However, they are required to abide by the rules outlined in the French Labor Code and Immigration.

VAT and corporation tax are due from French businesses. The VAT rate is 20%, and the corporation tax rate is 34%. All businesses must be registered by the VAT and corporate tax regulations.

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