The 5 key steps to set up a company in France

20 May 2021
Estimated reading time : 4 minutes
The 5 key steps to set up a company in France
20 May 2021
Estimated reading time : 4 minutes

Some common misconceptions are hard to shake. However, for several years now, the French government has been striving to make setting up companies in France easier.

According to a World Bank study, it now takes only 4 days to create a business in France. France ranks first in the European Union, ahead of its British and German rivals.

In France, only 5 procedures are required to start a business… compared to 7 on average in Europe!

Are you ready to take the jump?

Complete these 5 administrative formalities and start your business in no time!

Download our guide "5 key steps to set up a company in France”

Select your business structure

The choice of business structure is crucial, since it defines your business’s scope of activity and degree of independence from the parent company.

It looks at:

  • Strategic challenges: to what extent do you want to control the business in the new location? What is the economic potential of the destination?
  • Commercial challenges: will you produce and/or sell all or part of your range in the target area?
  • Legal constraint: what will be the most suitable legal structure for your business?

In principle, this is a decision that is made fairly early in the location project based on strategic objectives but also on several criteria that you assessed during your location study location study .

Logically, the siting procedures should be included in the location specifications that you share with your local partners.

Depending on your objectives and constraints, 3 solutions are possible:

  • Liaison Office: A liaison office can provide a short-term solution as a
    representative for the parent company. Its scope is limited and it cannot engage in commercial activity.
  • Branch: A long-term, straight-forward solution. A branch is a commercial entity that manages its own business while operating as an agency reporting to the company’s headquarters abroad.
  • Subsidiary: A subsidiary is a company subject to French law and offers
    the most comprehensive legal form. It can be set up as an SAS (simplified joint stock company), an SARL (limited liability company) or an SA (corporation).

Choose your legal status

The choice of legal status is an issue for all companies that want to operate in a new country. In France, there are many and varied legal statuses to enable companies to choose the structure best suited to their needs.

To find the one most suitable for you, several criteria must be taken into consideration, in particular the nature and scope of your project as well as the tax implications of each status.

The three most common legal statuses

Limited liability company (SARL)
This type of company is suitable for new companies such as a family business or one involving 2 or 3 shareholders.

Simplified Limited Company (SAS)
The flexibility of the SAS makes it suitable for larger projects, providing for investors and the distribution of dividends.

Corporation (SA)
An SA is suitable for large-scale entrepreneurial projects.

More information on legal status in our complete pdf guide!

Other legal formats to consider for your move

For example, general partnerships (SNC) or professional partnerships and economic interest groups (GIE)
These two legal structures may be of interest for subsidiaries.

The Societas Europaea (SE)
It offers a unique status defined by EU law which is common
to all member countries.

Deposit the share capital in a bank account

The share capital is the original value of the company. It can come from a contribution in cash or in kind.

Depositing the share capital is mandatory before signing the articles of association. The amount contributed is deposited with a draft of the articles of association in a blocked account in the name of the company with:

  • a bank
  • Caisse des Dépôts et Consignations (CDC), the state bank for official deposits
  • a notary public

The deposit is made in the form of a check, transfer or cash, by the partners or shareholders. In return, they receive shares in the company. The blocked sums are then released once the company’s registration is approved.

The minimum amount of the contribution depends on the legal status chosen.

Draw up the legal notice

The publication of a legal notice is a mandatory formality when creating a company.  Its purpose is to inform all potentially interested parties about the installation of a company (local residents, customers, etc.).

This is the last formality before the registration of the company. The notice must be published before the filing of the registration documents at the clerk’s office.

The following information must be included in your legal notice:

  • legal status
  • company name
  • company purpose
  • share capital
  • duration of the company
  • head office
  • type of act
  • date of the act

The logo and business name must also be included if they are mentioned in your articles of association. Finally, some other information is mandatory (identity of the manager, of the auditor, etc.) depending on the legal status you choose.

> Discover in our pdf guide, a concrete example of legal notice.

Register your future company

Processes for declaring and registering a company in France have been simplified.

They can be made:

  • online
  • at the relevant Commercial Court Registry

Once the procedures have been completed, the manager of the company will receive a certificate of incorporation known as an “extrait Kbis” formalizing the company’s existence.

 

Preparing to set up your company in France?

Now that you know all the formalities required to set up your company in France, all you have to do is choose your host region.

Discover 5 major advantages of the Hauts-de-France region for your project!