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French company formation
There are several types of business entities available for France business setup, the most common business type in France being the joint stock company, particularly fit for starting a small business in France. Foreign entrepreneurs can also set up their business in France as a limited liability company, a public limited company, a branch office or a representative office.
Common Company Legal Structure
Société à Responsibilité Limitée (SARL)
The (SARL) company is one of the most used company type in France. It is equivalent to the Limited Liability Company (LLC). The minimum share capital required to establish an SARL is €1
Société Anonyme – SA
A Public Limited Company (PLC), known as a Société Anonyme (SA), is designed for large companies in France. The minimum share capital required to establish an SA is €37,000.
Entreprise Individuelle – EI
A DAC has a 2 document constitution consisting of a memorandum and articles of association. A DAC must have a main objects clause included in its constitution which will restrict the activities of the company
Branch office
​A foreign company may also establish an external company in France. The parent company is fully liable for the actions and obligations of the branch.
​Branches have similar incorporation requirements to regular private companies​ but No share capital is required to establish a branch in France
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Limited Partnership (LP)
These partnerships have at least one general partner who runs the business and is personally liable for any business debts. The partnership also has at least one limited partner whose input is purely financial and who is only liable up to the amount they’ve contributed.
Société par Actions Simplifiée – SAS
The (SAS) is a type of joint-stock company that is favoured for its flexibility. Similar to an SARL, an SAS can be incorporated with one director and one shareholder, but allows for an unlimited number of shareholders. The company is required to appoint a president. The minimum share capital required to establish an SAS is €1
Incorporation process in France
When launching a business in France certain steps must be adhered to throughout the company formation process. For foreign entrepreneurs, particularly those unfamiliar with local laws, seeking legal assistance and representation is highly recommended. The company formation services offered by Yan Incorporation will be extremely beneficial.
Steps for company formation in France
Step 1:
Choosing legal forms
The first step in starting a company in France is to choose the right legal structure. The most common business structures for foreigners are mentioned above
Step 2:
Choosing a company name
Before setting up a company in France the National Institute of Industrial Property (INPI) will issue a certificate confirming that the names chosen for the company are valid and available for its use.
The certificate stating the availability of a name will be issued for 3 months (renewable for 3 extra months), a period in which the company must be incorporated.
Step 3:
Draft the articles of association and decide how the company will be managed
The Articles of Association (Statuts) are the foundational documents of your company, outlining the business’s purpose, management structure, and operational rules. Key elements to include are:
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Company Name and Registered Office: The official address of your business in France.
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Capital Structure: Details of the share capital, including the number and value of shares.
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Management Structure: Roles of directors and officers, their appointment process, and their powers.
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Decision-Making Processes: Procedures for making decisions, including voting rights and general meetings.
Drafting the Articles of Association can be complex, particularly for structures like SAS or SA, which offer more flexibility. It’s advisable to consult a legal professional or notary to ensure the document meets all legal requirements.
Step 4:
Open bank account
Opening a business bank account in France is essential for depositing the initial share capital and managing your company’s finances. Here’s how to navigate this process as a foreigner:
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Choose a Bank: Select a bank that caters to international clients, such as BNP Paribas, Société Générale, or HSBC France. Some banks may offer specialized services for non-residents.
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Submit Required Documents: You’ll need to provide:
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Valid passport.
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Proof of address in your home country.
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Proof of a business address in France (can be obtained through a virtual office service if needed).
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A business plan, particularly if seeking additional financial services or loans.
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Deposit Share Capital: The required amount varies based on your business structure (e.g., €1 for an SARL or SAS, €37,000 for an SA). The bank will issue a certificate of deposit, which is required for company registration.
Step 5:
Draft the articles of association and decide how the company will be managed
In the articles of association, the founding partners decide the essential matters of the company i.e. founding capital, shareholders, company address, object, duration, internal management, directors and shareholders meetings, etc, it is fundamental that the articles of association are adapted to the company needs.
Standard model articles of association are available to both SL and SA companies and can be drafted and registered in the English language when accompanied by a Spanish translation.
Step 6:
Sign the incorporation deed of the company before a notary public
To validly setting up a company in France, a deed of incorporation must be signed before a notary public. This deed of incorporation will include the articles of association which would have been previously drafted by the founding shareholders.
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In case of a third company being the shareholder whoever represents it must grant a UBO declaration (Ultimate Beneficiary Owner) before the notary public in which they identify the ultimate beneficiary owners who hold or control, directly or indirectly, more than 25% of the company shares, majority of voting rights, or controls the company by other means.​
Step 7:
Register the company with the Spanish tax office (VAT number obtention)
As part of the registration process, the entity will also automatically receive a tax number and a VAT number if required. Our Client will not need to travel at any point during this process
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The French tax authorities will assign an EU VAT number, which begins with the letters ‘FR’ followed by a 2-digit code and your SIREN number. This VAT number will be valid throughout the EU
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Branch Office Registration in France
Within the spectrum of legal entities available to operate or invest in France, a branch office is a valid option to access the market with full guarantees. Mixed up often for subsidiary companies, branches are not a separated legal entity to its parent company but an extension to it.
Differences between a branch office and a subsidiary company can be seen below:
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No require founding capital
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No legal capacity in its own
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No local management, decisions are taken by parent company.
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The parent company is liable for all actions or omissions of its branch
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​Branches have similar incorporation requirements to regular private companies​
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Get in touch with us
Contact us today to receive a quotation for our company formation in France. We are here to assist you every step of the way.
Contact
Email: info@yanincorporation.com
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