How to form a Corporation in France?

If you are willing to start a business in Europe, France might be a good pick. The forming process follows very simple steps and is probably similar to what you are used to. However, you will need assistance and a guideline from a law firm in order to be successful in your project.

A recent decree made it easier for an alien to create and expand his business in France. Indeed, the decree of May 9^th, 2007 suppressed the need of a foreign business owner card.

As a result, more than 30,000 corporations are created by foreigners every year in France.

2 different cases:

EU citizens: Because they are allowed to live and work anywhere in Europe without any visa, those people do not have to meet certain requirements that other people might have to. For instance, a German citizen could easily move to France in order to create his Corporation like any other French citizen would do. Among the different entities, he would be able to pick EIRL, SARL, EURL, SA, SAS etc…

Other citizens: For the investors outside of the European Union, the situation is different since they will have to obtain a visa before moving to France. Actually, the prospective business owner will have to obtain a “long term visa” or a “temporary visa” showing that his business plan makes sense. However, no visa will be required if he only wishes to have a commercial or industrial activity without the intent to live in France. In this case, he will be compelled to declare the nature of his activity to the department of State even before creating it.

Depending on your activity, several regulations might exist. That is why it is more than important to check whether or not your activity will require a permit or an authorization. Creating a Company without the right authorizations is a risk you cannot afford. Your lawyer will be here to assist you with this issue.

After preparing your business plan and reporting your project (alongside with your business plan) to the department of State, your lawyer will assist you in creating your legal entity.

Choosing a Corporation will induce that a new “person” will be created. Your legal entity (“personne morale”) will be distinguished from you, so that you might not be liable for its debts. The Company will have a name, a domicile and its own holdings. This will induce that you must not personally use the company assets without being charged with “misuse of company assets”.

Your entity will automatically be taxed as a company or in other cases you might elect this way of taxation as well.

Incorporation Process:

You will need to register your company with either the Repertoire national des enterprises (RNE) or Registre du Commerce et des Sociétés (RCS) or Repertoire des métiers (RM), depending on your statuts.

To do so, the only administration you will have to deal with will be the CFE (Centre de Formalités des Entreprises).

Once your company is registered, several ID numbers will be given to you:

SIREN number
SIRET number
APE Activity Code
ID number to mention when you have to deal with the administration

During this registration, the capital stock will be paid into escrow with a bank or with a notary.

Your Corporate Lawyer will also write the Operating Agreement (called “statuts”) stating the rights and duties of the stakeholders and members but also nominating the first managers. This Operating Agreement will have to be published to the Tax Administration in 4 original copies.

Finally, you will have to publish your intent to create a company in a legal newspaper.

Within 3 months of registering your business, it is mandatory to obtain your “employees retirement affiliation”, even though you don’t have any employees nor you plan to do so.

In any case, it is also a smart move to insure your business or your practice.

Creating a Corporation in France is not that difficult but you will need to be assisted by a Corporate lawyer who will advise you on how to create your entity, which tax classification to choose in order to minimize the tax impact, what authorizations you will eventually need, etc…

To do so, our team of lawyers is available to facilitate your establishment in France.

Sebastien Gaddini

New York Bar

Last update 07.19.2010

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