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Introduction

Setting up a company in France is always an interesting phase, especially if you consider the polity as a strategic point for entering the European trading field. The polity is not only a large and developed trading field, it is also an imperative hub for innovation, trade and industry in Europe. It has everything you need for a successful start, be it a highly skilled workforce or access to a large consumer market.

To register a legal entity in France, it is worth comprehending that the polity opens up a lot of opportunities for financiers. Of course, bureaucratic sequences may seem a bit cumbersome, but in fact, if you arrange in advance, many parts become quite manageable. For example, already at the stage of registering a French enterprise, you can use online platforms, which saves time and effort. This simplifies the sequence even for those who are far beyond the polity. In this regard, the polity is much more flexible than many other European countries.

Corporate forms of business in France

It all starts with opting for the right legal form for your venture. It may seem like a small thing, but it is worth taking the time to understand which form is best for your trade purpose.

1

LLC (Société à Responsabilité Limitée - SARL)

This is a form of enterprise that meets the needs of SMEs, since it is an LLC. The base prerequisites for its creation are quite flexible and beneficial for organisation founders, primely those who do not want to immediately lure a large number of financiers. When starting an enterprise in this state, a non-occupant should note the main prerequisite - to have at least one founder, and they can be shown by both individuals and corporate entities. No base authorized capital is vital for enrollment, which seems quite democratic for the beginning.

Equally, despite the low base investment, SARL gives the financier a certain degree of protection, limiting liability only to the quota of capital speculation in the enterprise. This format makes it possible not only to minimize perils, but also to oversee the firm without the need to lure external financiers, which is the optimal solution for beginning financiers. Also, the oversight of a French firm in the form of SARL is allowed both by one person and by several, which provides flexibility in making oversight decisions.

In the SME sector, the SARL is often the best choice because it mandates limited liability but does not burden the proprietors with complex reporting or corporate model prerequisites. When considering trade forms, simplicity and independence are the top priorities. All that is needed to start a business in France are a few administrative phases and start-up money, which, as already mentioned, can be symbolic.

Also, French statute mandates for this type of scheme to be undertaken with minimal levy consequences, which is also imperative for small endeavours. Unlike other countries where small endeavours often face bureaucratic red tape and reporting difficulties, in the polity a financier who has chosen the SARL form does not face unnecessary formalities and can focus on the growth of their firm.

What is primarily convenient is that SARLs do not necessitate a large staff, making them an attractive option for startups. Also, it is always imperative to remember that  to boost trust from associates or clients, it is imperative to assert transparency in accounting and regular abidance with pecuniary reports, which, although not difficult, necessitates attention.

2

implified Joint Stock Company (SAS): your reliable partner in French business

Among the renowned forms for startups in France this is SAS. Unlike other forms of business, SAS gives much more room for maneuver in oversight, organization of work and determination of internal ordinances.

SAS in France mandates you to define in the charter almost all the conditions of the firm's work - from who will oversee the trade to how exactly key issues are resolved. This mandates you to customize the style of work of a French trade without having to adapt to strict licit prerequisites, as is the case with more traditional forms. For example, you can decide who makes decisions and how, and who will be responsible for oversight.

Another nice thing is the base capital from 1 euro. Yes, that’s right. And although in practice most ventures invest more, this flexibility gives freedom in making decisions at the start.

The only imperative detail to remember is the sponsorship obligations. Half of the sponsorships must be released immediately, and only after five years can the sequence be fulfilled. It is imperative to know that if you sponsor property, such as equipment or machinery, an independent valuation of these resources will be vital if their value exceeds 30,000 euros.

The oversight sequence of a French firm also leaves a lot of room for creativity. SAS always appoints a firm president who will be responsible for external relations and management. It is imperative to understand that he will not only represent the firm, but also be responsible for prospective oversight errors. This is an imperative point, because in the event of something happening, it is the president who is responsible for the firm's schemes.

In terms of levies, the firm will remunerate corporate tax (IS). The basic rate is 25%, but for small ventures with an annual turnover of up to 10 million euros, a declined rate is supplied - 15% on the first part of the profit up to 42,500 euros. This is a pretty nice bonus for young ventures that are starting to gain momentum.

SAS also offers the option of opting for an alternative excise system, called member-level levy (IR), if certain conditions are met, such as fewer than 50 employees and an annual turnover of less than €10 million. This mandates levies to be shifted from the firm to individual partakers, which may be more convenient contingent on your structure.

Many financiers often ask about social protection for the enterprise president. In SAS, the president is considered an employee and is supplied with the same social guarantees as an ordinary employee, with the exception of unemployment insurance. Of course, there is an additional option - you can take out voluntary unemployment insurance, which is also worth considering.

The sequence of transferring shares in SAS is also quite flexible. In principle, shares can be freely transferred, but the firm's articles of association may include additional conditions, such as the right of first refusal for other participants. This does not hinder the development of the trade, but it is imperative to discuss such points in advance to avoid misunderstandings in the future.

Among the main points to emphasize is the need to contact specialists when drafting the charter. The flexibility of this form necessitates attention, and correctly written terms of work can significantly simplify the oversight of the firm for many years.

Business Registration in France - This is not just a formality. This is a phase that necessitates a serious approach, but if everything is done correctly, the way forward will open up with much fewer obstacles.

3

Everything you need to know about the French general partnership (SNC)

There are several things to consider during enrollment that immediately catch your attention. Among them is the possibility to opt for the SNC (Société en Nom Collectif) form, which means "general partnership". This is not the renowned form, but it has imperative merits for a certain type of trade. First of all, it lures those who value flexibility in organization and oversight.

The peculiarity of SNC in the polity is that it necessitates a minimum of two participants. These can be equally individuals and licit entities, but each participant bears unlimited liability for the firm's obligations. This is an imperative point, because if the firm encounters pecuniary difficulties, the associates may be obliged to answer for the trade's debts with their personal property. Also, this approach sometimes facilitates easier obtaining of loans, because creditors see that all partakers of the firm are directly interested in its successful functioning.

One interesting point is that SNC has a fairly loose charter and terms of reference, which gives associates more room to maneuver. Oversight of the firm can be delegated to one or more participants, or to external overseers, contingent on how it is written in the charter. The associates decide who will be in charge of day-to-day oversight and who will be in charge of more strategic issues.

The base quota for its formation is only 1 euro. Of course, to seriously develop a venture in the polity, you are unlikely to limit yourself to such modest amounts. Capital is usually formed through monetary speculations and tangible resources, such as equipment or real estate. But it is imperative to remember that the contribution in the form of knowledge and experience (the so-called contribution to the industry) is not considered part of the capital, although it can be imperative for the functioning of the firm.

By the way, the SNC excise system is focused on levy of revenues, as in the case of sole proprietors.Therefore, each partner remunerates levies on the share of revenues that he receives from the firm. In the case of overseers, their income is also charged, and this is contingent on whether you have chosen to levy your firm through corporate tax or through individual levies.

When it comes to conveying shares in a French firm, it is not as simple as in some other forms. All participants must unanimously agree to the sale or transfer of shares, and such a transaction must be formalized in writing. Moreover, enrolling the transaction necessitates paying levies - for example, when selling a share in a firm, you will have to remunerate a fee.

So, if you want to start a business in France with associates, an SNC can be an flexible form that mandates you to arrange the oversight at your discretion, but also necessitates attention to licit and pecuniary issues.

Main distinctions between SARL, SAS and SNC in France:

Parameter

SNC (Single-member corporation)

SAS (Simplified Joint Stock Company)

SARL (Limited Liability Company)

Number of founders

From 2 to unlimited

From 1 to unlimited

From 1 to 100

Supervisor

One or more managers (gerants)

President (possibly several CEOs)

One or more managers (gerants)

Volume of the authorized capital

Possibility of boosting capital beyond the current quota

Possibility of boosting capital beyond the current quota

Possibility of boosting capital beyond the current quota

Pecuniary solvency prerequisites for enrollment

There are no capital commitments

At least 50% of funds must be deposited at the time of enrollment

At least 1/5 of the funds must be deposited at the time of enrollment

Pecuniary responsibility

Unlimited and joint

is determined only by the volume of contributions

determined only by the size of the deposits

Levy of income

Income Tax (IR), with the preference of opting for Income Tax (IS)

Income Tax (IS), with the preference of opting for Income Tax (IR)

Income Tax (IS), with the preference of opting for Income Tax (IR)

Levy of the manager

Guerant-founder: tax on income (IR) in categories BIC, BNC or income from real estate. Guerant-non-founder: tax on income in category of wages

Income tax in the category of salaries

Income tax in the category of salaries

Social status of the manager

Gerant-founder: self-employed (TNS). Gerant-non-founder: equal to an employee

Equated to an employee (assimilated worker)

If the gerant has the majority of votes - self-employed (TNS), in other cases equal to an employee

Types of securities

Shares

Stock

Shares

Transfer of shares

Consent of all participants is mandated

Free transfer (with the possibility of including approval conditions)

Consent of participants is vital

State duty on transfer of shares

3% of the transaction quota after deducting 23,000 euros

0.1% of the transaction quota

3% of the transaction quota after deducting 23,000 euros

4

Sole proprietorship (EI): imperative parts for starting a business in France

It comprises a sequence that combines both bureaucratic rigor and elements of flexibility that consent you to adapt your trade to your individual needs. In many cases, opting for EI status in the polity turns out to be a very practical solution, primely if you plan to run your trade alone. The main merit of this option is the minimal prerequisites for the constituent indentures. Unlike more complex forms, such as joint-stock companies, there is no need to develop a charter or sponsor start-up capital.

The simplicity of the design does not mean a lack of subtleties. For example, an imperative point is the personal liability of the trade proprietor. Since EI does not create a separate licit entity, the trade is effectively tied to its proprietor. Therefore, all resources, including property that is not used for trade (for example, housing or savings), remain protected from the firm's debts. Also, it is worth considering that excise or social obligations can lead to the withdrawal of funds from personal accounts.

For financiers who decide to perform under the micro-business model, the excise system also presents an interesting choice. The main levy for most is the personal income levy. Also, it is prospective to switch to the corporate tax system if the firm becomes more complex and generates EURL (sole proprietorship limited company). This can be useful for those who are planning serious growth and need to protect resources such as property or equipment from personal debt.

Social sponsorships are another thing to consider. They are calculated based on trade income and are about 45% of the revenues received. This, of course, greatly contingent on the firm's pecuniary performance, but it is imperative that if income is minimal or absent, sponsorships must still be paid - at least minimally. It is imperative to plan your budget in advance taking these obligations into account  to avoid unpleasant surprises.

It is also worth remembering about the transfer of a French business in the future. If there is a need to transfer a venture, this can be done not only through a sale, but also, for example, through a gift. It is also prospective to transfer the venture to family members or third parties. Also, it is worth remembering that the transfer of assets may entail additional costs, including the enrollment of the transaction. Such nuances make asset transfer planning an imperative part of a long-term strategy.

Overall, the sequence of setting up a business in France is fairly easy to get started, but necessitates some care and preparation to avoid complications with levies and social security sponsorships. Remember that every detail matters, whether it is opting for an excise regime or comprehending how personal resource protection will work.

5

Merits of a sole proprietorship limited liability company in France (EURL)

Among the popular types of company registration in France is EURL (Entreprise Unipersonnelle à Responsabilité Limitée). This is something like a sole proprietorship with limited liability, consenting the proprietor not only to oversee the trade, but also to limit the perils of his personal property.

First of all, it is worth noting that EURL in the polity does not necessitate a base capital upon establishment. This can be very convenient for those who want to start with a small speculation. Although not mandatory, if you plan to sponsor resources (such as equipment or intellectual property), you will need to have this valued by the valuation commissioner. This is a mandatory phase if the quota of resources to be sponsored exceeds 30,000 euros or they represent a large part of the capital’s sum of the firm.

What is imperative is the limited liability system. Therefore, if something goes wrong, the proprietor's liability is constrained to the quota of his speculation in the firm. Also, if the founder is also the oversight team (for example, the CEO), his liability can be extended in case of bad decisions, primely if it concerns pecuniary transactions or bankruptcy of the firm.

Speaking about the oversight team, it is worth clarifying that in the case of EURL, it is always a person, not a licit entity. The CEO can be either the proprietor himself or an outside candidate. But there is an imperative detail: if the organisation founder decides to transfer oversight to a third party, it is not that simple. You will have to carefully select a suitable candidate who comprehends the specifics of working in the French licit environment.

The sequence of registering a French business is quite formal. You need to draw up the company's articles of association, which essentially defines the internal ordinances and commitments of the participants. Also, although there is no mandatory base capital prerequisite, an initial contribution is compulsory. In the case of money, this necessitates contributing at least 20% of the agreed quota upon enrollment, the rest - within five years.

By the way, if you decide to transfer or sell the firm one day, it is also not difficult. You can transfer shares to both heirs and third parties. The only formality is that you will need to draw up an act on the transfer of shares and enroll the changes with the overseers.

An equally imperative point is the levy and social security of the oversight group. contingent on who is the proprietor and overseer (an individual or a licit entity), excise rates and sponsorships may vary. For example, if the proprietor is an individual, it is unlikely that it will be prospective to avoid social sponsorships at the manager level, which will have an impact on net profit.

Setting up a company in France is not just about formalities. It is about comprehending the culture of trading in this polity, respect for bureaucratic sequences that, although they may seem burdensome, are actually aimed at creating a stable licit and economic environment.

6

Managing a Sole proprietorship limited by shares (SASU) in France

When you decide to launch a firm in the polity, among the renowned choices for sole proprietors is the SASU (Société par Actions Simplifiée Unipersonnelle) form. It is a kind of hybrid: Also, it mandates you to be the sole proprietor of the endeavour, on the other, it gives you freedom in the oversight and organization of the firm. On the surface, it may look simple, but there are a few things you should know before taking the initial phase.

Among the merits of SASU is the ability to customize everything according to your personal preferences. It is not a standard model with rigid frameworks, as in other forms, for example, in SARL. Here, you, as the sole financier, determine who will be the overseer - this can be either yourself or someone from outside, for example, a supervisory specialist. For example, if you do not want to personally run the endeavour and deal with day-to-day oversight, you can always appoint an external president of the firm.

What is imperative to consider when enrolling in a SASU? The cost of capital – there is some flexibility here. The base quota is only 1 euro. But this does not mean that you have to limit yourself to money. You can sponsor property to the capital – for example, equipment, machinery or even intellectual property, if it has a value. Also, if you plan to sponsor intangible resources (for example, know-how or trademarks), you may need a specialist assessment.

Now about the process. The SASU registration sequence itself in the polity is relatively simple: you submit indentures to the directory, and also draw up the charter, in which you specify how the firm will be overseen. It is imperative to remember that SASU supplies a lot of freedom, but this also makes the sequence of preparing the charter quite specific. If you do not want to face problems in the future, it is better to consult a lawyer who will help you draw up all the indentures correctly.

When it comes to levy, that's a different story. In general, SASU is subject to corporate tax (IS) at a rate of 25%, but for small companies there is a reduction to 15% for revenues up to €42,500. So for startups that don't plan on high turnover right away, this could be a good option. Equally, there is the option to opt for the personal income tax system if your firm meets a number of criteria, such as turnover and number of employees.

Also, The dividend tax in SASU is also different: it is 30%, of which 12.8% is income tax, and 17.2% is social sponsorships. By the way, if you plan to work without a salary and receive only dividends, it is worth remembering that this will not be taken into account in your social security. That is, if you want to have health insurance or other social guarantees, it is better to think about salary payments.

From an organizational point of view, it is also imperative to comprehend that in SASU, a sole partner can easily transfer his shares to another person or pass them on by inheritance. Also, when moving from SASU to a more complex form – SAS – changes to the charter will be vital, since the emergence of new financiers necessitates a different organizational model.

Although for many, registering a company in France is a complicated sequence with bureaucratic obstacles, in reality, everything is quite clear. The primary thing is to comprehend the nuances in advance and not forget about licit assistance, primely when it comes to the charter and levy. This is an excellent form for those who want to be flexible and independent in managing their endeavour, without losing confidence in licit protection.

Comparison of EI, EURL, SASU:

Parameters

EI (Individual Entrepreneur)

SASU

EURL

Number of partners

No partners

1

1

Supervisor

Entrepreneur

President

Manager

Capital size

No mandated capital

Free capital

Free capital

Levy system

Income Tax (IR) can be selected SI

Income Tax (IS), IR may be selected

Income Tax (IR), SI can be selected

Social security of the manager

Self-employed system

Assimilated employee

Assimilated employee

Corporate securities

No securities

Stock

Shares (stocks)

Transfer of the company

Free transfer

Free transfer, agreed transfer possible

Free transfer, agreed transfer possible

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7

SA (Société Anonyme)

The SA is a large-scale company formed in France, suitable for the creation of partnerships with high standards for structure and capital-intensive initial speculation. Compared to other forms, the SA implies more complex prerequisites, primely when it comes to establishing an endeavour. For example, to register an LLC in France, the base capital is 37,000 euros, which in itself immediately distinguishes this format as suitable for larger projects and enterprises.

As for financiers, SA in the polity must have at least two - this is a mandatory prerequisite. This approach makes the firm more open to external financiers, which is primely imperative if it is planned to lure significant funds or work with public trading fields. The model of French share capital mandates for flexible oversight of shares, which is convenient for attracting new financiers or changing the composition of the proprietors.

An interesting point worth noting is that to open a joint-stock company in France, not only financiers are vital, but also directors. Therefore, the firm must have at least one director (or more, contingent on the organizational model). Moreover, directors can be both local and transnational, which opens up additional opportunities for attracting experienced overseers or consultants from other countries.

Unlike simpler forms of venture, when setting up an SA in France, you are faced with stricter reporting prerequisites. It is mandatory to audit the firm, which is linked to the need to abide with high standards of transparency. Therefore, all pecuniary schemes of the firm must be carefully documented and subject to regular audits by independent auditors. For many financiers, this can be an additional burden, primely at the start, but it is also a signal to associates and financiers about a high degree of trust and responsibility.

The French SA reporting system in France includes mandatory pecuniary reporting to financiers, as well as regular public reports, which makes this form of firm more complex to oversee, but equally boosts its attractiveness to financiers. Also, SA supplies the opportunity to enter the stock market, which is a significant plus for endeavours arranging expansion or raising capital through public offerings.

Thus, if a firm is aiming to scale and lure large speculations, SA is a suitable choice, despite the resource-intensive nature and reporting prerequisites.

Comparison of company forms SA, SARL and SAS :

Parameter

SA 

SARL 

SAS 

Number of partners

Min. 2 (min. 7 if the company is listed on the stock exchange)

From 2 people to 100 people.

Min. 2 (for SASU - 1 founder)

Supervisor

President and CEO

Managers

President and CEO (flexibility of oversight model)

base capital

€37,000

From €1 (more recommended for stability)

From €1 (more recommended for stability)

Prospective types of deposits

Currency, nature and industry

Currency and nature

Currency, nature and industry

Payment of contributions upon creation

Not less than 1/2 of the capital quota upon creation

Not less than 1/2 of the capital quota upon creation

Not less than 1/5 of the capital quota upon creation

Levy of profits

Corporate Tax (IS), possibly IR if conditions are met

Corporate Tax (IS), possibly IR if conditions are met

Corporate Tax (IS), possibly IR if conditions are met

Social security of the director

Assimilated employee

Assimilated employee

Sole proprietor (TNS) if he/she oversees the majority of the firm; otherwise, an employee

Securities

Stock

Shares

Stock

Possibility of trading on the stock exchange

No

No

Yes

Transfer of securities

Free (may be subject to approval)

Free (may be subject to approval)

Authorization of participants

Enrollment fee

0.1% of the transfer cost

3% of the sale price after deducting €23,000

0.1% of the transfer cost

8

SCA in France: an alternative form of business organization

Société en Commandite par Actions (SCA) in the polity is an unusual but quite interesting form of trading in the polity. It combines the features of two other forms: société en commandite simple (SCS) and SA. The prime feature is the ability to lure financiers with limited liability and equally maintain oversight for a small circle of people.

There are two types of participants: active and passive. Active ones are the team associates. They oversee the firm and are liable for its debts with all their property. And passive ones are team financiers. They supply money, monitor how things are going, but do not interfere in oversight. Their liability is constrained to the value of invested funds. You cannot just take and become an overseer if you are passive. Even signing undertakings with suppliers is prohibited. But you can participate in meetings and be aware of what is happening.

Now about the money. To open an SCA in France, you need at least €37,000. If you plan to go public, you will need €225,000. You can invest in money or property – for example, equipment, real estate or patents. Although active associates do not seem to participate in the capital, they can buy shares and become financiers equally.

As for income levy, the standard option is the corporate income tax (IS). This is 25% of annual income. But for startups and small endeavours, there is a preferential option - 15% up to €42,500 in income. If you want to compensate for the corporate income tax (IR), this is also prospective, but a number of conditions must be met. For example, the firm must be newly established (up to 5 years old), small (less than 50 employees) and perform in the commercial or manufacturing sector.

SCA is convenient because it mandates you to raise capital by issuing shares, but does not consent financiers to influence oversight. Oversight is usually undertaken by one or more people appointed when the firm is created. They are controlled by a board of financiers, who check the accounting and monitor order.

9

Simple partnership (SCS): specifics and ordinances

First of all, it is worth noting that in the polity, a venture is not simply created, but goes through several phases, each of which has its own specifics and necessitates abidance with certain ordinances. SCS registration in France is a sequence that necessitates attention and comprehending of local nuances.

One interesting option for setting up a business in France is the limited partnership (SCS). This type of French venture can be quite attractive if you want to balance liability and speculation. There are two types of associates in an SCS: general partners, who oversee the firm and are personally liable for the firm’s debts; limited partners, who are essentially financiers whose liability is constrained to the quota of their speculation. This approach works well for those who want to lure financiers while keeping oversight in-house.

The peculiarity of SCS in the polity is the possibility to flexibly oversee the firm's capital. Its size is not regulated by strict prerequisites, and the base value is only 1 euro. This gives freedom at the initial stage, when money can be directed not only in cash, but also through other resources, such as equipment or intellectual property. Also, the payment of sponsorships can be postponed, which mandates "distributing" the burden on the trade contingent on its needs.

However, despite the freedom in capital matters, it is imperative to remember that the associates' liability varies. General partners are liable without limitation, meaning that they can be held liable for the organisation's obligations using their personal resources. Limited partners, on the other hand, are protected: their liability is constrained only to the quota they have invested in the organisations. This is an imperative distinction to keep in mind when deciding on the composition of associates.

In terms of oversight, SCS has a feature that makes it convenient for different types of endeavours. General associates are overseers, but if it is written in the charter, an external manager can be appointed. This flexibility mandates the oversight model to be adapted to the needs of a specific project. The charter can also regulate which decisions can be made without the consent of the associates, which adds an additional level of control.

It is also imperative to consider the excise burden. General associates are vital to remunerate personal income tax on their share of the organization's revenues. While limited associates may be charged under the corporate income tax system, which usually supplies more favorable conditions from a tax perspective. This is an imperative point for those who plan to minimize their tax liabilities and will lure financiers.

It is also worth remembering that in the polity, as in many other countries, trade is faced with bureaucratic phases. Entering an organization into the state register of France necessitates the preparation of many indentures, including the organization's charter, agreements with associates and information on capital. Equally, even after enrollment, you will have to deal with a number of formalities, such as bookkeeping, reporting and interaction with tax overseers.

Another point worth noting is that if among the general associates dies, the organisations may be dissolved unless the charter supplies for its continuation. However, if the trade continues to exist, the heirs may be included as limited associates. This may be a useful option for those who want to continue the trade through inheritance.

Ultimately, registering an organization in France is not only a licit sequence, but also a strategic choice. It is imperative to comprehend how to opt for the right form of proprietorship, the perils and opportunities this form supplies, as well as how to establish effective oversight and excise optimization. Each stage necessitates attention, but with the right approach and good preparation, the polity can be a great place to trade.

Comparison table: SA, SCA and SCS

Parameter

SCA (Limited Joint Stock Company)

SCS (Simple Limited Partnership)

SA (Joint Stock Company)

Number of participants

Minimum 4 (1 limited + 3 limited partners)

Minimum 2 (1 limited + 1 limited partner)

Minimum 2 (or 7 if shares are listed on the stock exchange)

Control

Manager(s) + Supervisory Board

Manager(s) + (Supervisory Board - optional)

President + Team of overseers or Directorate

Authorized capital

37,000 €

Not installed

37,000 €

Payment of capital contributions

Not less than 1/2 when created

No obligations

Not less than 1/2 when created

Levy of profits

Income Tax (IS), with the option of opting for Income Tax (IR)

IS for limited partners, IR for limited partners

Income Tax (IS), IR option possible

Social regime of the manager

TNS (self-employed) - if the manager is a limited partner, Assimilated employee - if not a limited partner

Self-employed (TNS)

Assimilated employee

Types of shares

Stocks and shares

Only shares

Stock

Transfer of shares

Unanimity of participants for shares, unlimited transfer of shares

Unanimity of the participants

Free transfer (opt-in clause possible)

10

GIE in France as a tool for joint action

Registering a Groupement d'intérêt économique (GIE) in France is one form that may be of interest to those seeking flexibility in organizing the joint schemes of several ventures. This licit entity supplies businessmen with the opportunity to combine their efforts while maintaining their independence.

Unlike standard ventures, where all participants usually work under a single oversight, in GIE everyone retains their independence. This is ideal if you need to pool resources for joint advertising campaigns, purchase materials, or even create common services such as accounting or IT support. An example would be a situation where several small endeavours decide to cooperate  to decline the costs of purchasing raw materials or jointly promote their products on the trading field.

It is worth remembering, however, that this is not exactly an organisation in the traditional sense. Although the GIE in the polity does not have a profit objective, partakers can receive income that they retain for future use. For example, if the GIE finds a favorable agreement for its partakers, the funds can be used to improve the work of the partakers – for example, to purchase new equipment or expand marketing schemes.

As for liability, this is one of those topics that may surprise you. GIE partakers are jointly and unlimitedly liable for the organization’s debts. Therefore, if the GIE is in debt, creditors can turn to any member to remunerate off the debt. It is imperative to think about this in advance to avoid unpleasant surprises in the future.

The organizational model of the GIE is quite flexible, and often the decisive role is played by the undertaking itself, which is signed by the participants. It may supply for the creation of mandatory meetings, the definition of voting ordinances and the sequence for making decisions. This mandates all parties to comprehend exactly how issues will be resolved and who will take responsibility in case of failure.

Another interesting point concerns levies. Although the GIE itself is not charged, each participant will remunerate levies on their share of the revenues generated through this mechanism. This is imperative to consider when arranging finances, as revenues will have to be divided at the participant level as well.

The status of the participants also plays a significant role. GIE is open to a wide range of organisations – from individual financiers to large associations or even municipalities, if they are involved in economic schemes. This supplies an opportunity to build a wide network of associates and strengthen your trade by taking leverage of the benefits of cooperation.

Thus, enrolling a GIE in the polity is not only a chance to use shared resources effectively, but also a need to comprehend that every responsibility and every phase must be carefully weighed, because the consequences may be more serious than they seem at first glance.

Company Registration Process in France

Starting a business in France necessitates attention to detail. The first thing to comprehend is that without a long-term visa and a residence permit, everything else is pointless. A visa is issued at the consulate or through the France-visa online service. After arriving in the polity, within three months you must apply for a residence permit, attaching indentures including proof of organisations enrollment.

For individuals, the main documents are the Identity Card, or ID card, which can be French or from the European Union, and a passport. It is noteworthy that even expired indentures can be accepted if they meet certain conditions: for example, an identity card issued after January 2, 2004, can be considered valid for up to 15 years after its expiration. However, with passports the situation is more clear-cut – it must be valid.

If we are talking about a resident, a residence permit is supplied, which clearly states the right to perform in the polity. If it expires, an additional indenture will be vital - a receipt for filing an application for extension. It is imperative to be careful here: such details sometimes complicate the sequence, primely when communicating with various municipal services.

Since the beginning of 2023, the polity has switched to a centralized enrollment system through a single window overseen by INPI. The platform mandates not only to register a business in France, but also to submit requests for changes or closure. The sequence is fulfilled by receiving a Kbis extract - an indenture that officially confirms the existence of the organisations. It must be valid and issued no more than three months ago, which indicates the relevance of the data. Without it, it is impossible to open a bank account or conclude undertakings.

The merits of enrolling a company in France

Among the first merits worth noting is the ability to complete the sequence online. For many financiers, this is the moment that can be decisive. Compared to other countries where setting up a trade necessitates a personal presence, the polity offers much more flexible conditions. Enrolling a firm online mandates you to not only save time, but also avoid a lot of bureaucratic formalities that often necessitate trips to authorities.

The entire sequence is simplified to such an extent that the application can be submitted online, filling out all the necessary forms directly from the computer. The application for organisation enrollment is submitted through specialized government portals, which, in turn, eliminates the need to visit various overseers. This approach makes the polity quite convenient for transnational financiers who want to enter the European trading field without unnecessary costs.

In practice, remote organisation enrollment in the polity mandates you to avoid wasting time on travel or waiting in lines. This is convenient not only for those outside the polity, but also for local financiers who do not need to waste time personally contacting excise or commercial registers. When all the information can be filled in online and applications submitted, all that remains is to focus on other parts of the trade, such as marketing or product development.

Of course, it is worth considering that  to successfully enroll a firm on the Internet, it is necessary to properly arrange the indentures, translate them into French and certify them with a notary. But the very idea that all this can be done without unnecessary bureaucracy makes the sequence much simpler and less expensive. Technologies supply real freedom and consent to open a company in France without leaving your home.

The merit of remote enrollment is especially noticeable when it is necessary to register a firm in another jurisdiction, where everything can take several weeks or even months. In this regard, the polity really offers among the most convenient systems, combining simplicity and efficiency.

Fiscal tariffs in France

The French excise system is fairly frameworks, and levies have a significant impact on how you do trade. Here's what the excise situation looks like for endeavours in the jurisdiction, including corporate levies, VAT, and fiscal payment obligations.

CIT

The official corporate income levy rate in the polity is 25%. This is a relatively standard rate for most endeavours, but there is a system of incentives for start-ups and small endeavours. For example, for ventures with an annual income of up to 10 million units of the European currency, there is a rate declined to 15% on the first 38,120 € of profit. This is a fairly significant benefit for the small and medium sector, which stimulates their growth and development.

There are also excise credits and deductions for innovative ventures that are engaged in research and development (R&D), which can decline the excise burden. Support programs for start-ups, technology and innovation ventures also supply additional excise incentives, making the polity attractive to technology financiers and research enterprises.

VAT

VAT in France is among the main levies paid on the sale of goods and services. The standard VAT rate in the polity is 20%. This is quite a high rate, but it is compensated by a system of various declined rates for certain categories of goods and services. For example:

  • 5.5% is the rate for food products, some medicines, books, and some cultural events.
  • 10% – rate for public catering, transport, hotel services and some construction services.
  • 2.1% – rate for medical goods and services.

These different VAT rates help to stimulate consumption in certain sectors of the pecuniary field, such as culture, medicine and catering.

Levies on payments

The French tax system also regulates payments such as royalties, dividends and interest to foreign ventures. In some cases, transnational agreements may supply relief, and the levy of interest paid to foreign creditors or debt holders is generally 0%. Residents of the polity are exempt from levy of such payments.

Let's look at the main points.

Dividends:For foreign ventures receiving dividends from French subsidiaries, the dividend excise rate is 25%. However, this rate may be declined contingent on the existence of double levy agreements between the polity and the recipient polity. In some cases, the rate may be declined to 15% or even 5% if the agreement supplies for such conditions.

Royalty: The royalty excise rate for foreign ventures is 25%, but again this rate may be declined under double levy agreements. This is imperative to consider when arranging transnational transactions.

Percentages: In some cases, transnational agreements may supply relief and levy on interest paid to foreign creditors or debt holders is generally 0%.

These levies on payments are imperative for ventures that do trade transnationally because payments in the form of dividends, royalties and interest can become a significant part of cash flows.

Enrollment Recommendations

When it comes to registering a business in France, it is easy to come across nuances that are sometimes not obvious at first glance. An imperative point is to consult with experts. Each region has its own bureaucratic peculiarities, and they may not always be intuitively clear. A good lawyer or accountant who is familiar with local statutes and sequences can save a lot of time and avoid costly mistakes. For example, in the polity, where the excise system can be quite complex, proper paperwork and opting for the optimal form of venture are of great importance for minimizing excise perils.

Without qualified assistance, this can delay the sequence of enrollment and trade creation. And here it is imperative to consider that often the lack of local knowledge can lead not only to momentary difficulties, but also to additional costs.

There are other things that can be missed when trying to register on your own. For example, it is imperative to think in advance about what type of excise regime will be more beneficial for the firm, how to properly register trade accounts to avoid blocking funds in the future, and how to opt for a legal address. Inexperience in these matters is fraught with not only a loss of time, but also resources.

Thus, without the support of experts, the sequence of creating a venture in another polity can become much more labor-intensive and risky than it seems at first glance. Expert consultants who know all the local statutes and trading field features can help you quickly navigate and assert proper venture oversight from the onset.

Final word

Enrolling a venture in another polity, especially in Europe, necessitates attention and comprehension of many key parts. Key stages such as opting for a licit form, creating a venture, drawing up and translating indentures, enrolling a legal address and opening an account – all this necessitates clear planning. In some countries, you should thoroughly comprehend levy issues, which can subsequently affect the pecuniary efficiency and development of the venture. Do not forget about the importance of consulting with experts who will help you go through all the stages without mistakes and unnecessary costs.

If the enrollment sequence seems complicated or you have questions, it is recommended to seek advice. A team of experienced specialists will help you avoid pitfalls, save time and resources, and supply support at every stage of venture creation.