It's possible to set up a business in France once you've established yourself abroad. The trick is knowing how to get started.
How do you set up in France and establish your new head office?
When a foreign company wishes to set up in France, it may decide, before establishing a subsidiary, to start by setting up a branch or liaison office. Whatever the decision, the establishment must follow a number of formalities in order to comply with the law.
Whether the move is temporary or permanent, the foreign company is legally obliged to register a head office in France. The steps involved can be long, complicated and risky when it comes to acquiring real estate or signing a commercial lease. These steps are not necessarily the wisest if the company's aim is simply to test the French market, especially if there are no plans to hire employees in France in the first instance.
Following this domiciliation stage, the foreign company must register with the Centre de Formalités des Entreprises and the Registre du Commerce et des Sociétés.
Let's now take a look at the different ways of setting up business in France, with a focus on branches and liaison offices.
Definition of a branch: legally speaking, a branch is an establishment belonging to a group. It is generally subject to the same obligations as companies of French origin. The branch has no legal personality of its own, and no assets of its own, but enjoys a degree of autonomy in its management and direction. The law authorizes it to trade with third parties, but its activities are directly linked to the parent company. Its profits and losses are therefore taxed in the name of the parent company. The parent company does not have to file annual accounts or appoint an auditor. Unlike a subsidiary, which is highly autonomous, a branch has a more flexible, less restrictive structure. It is an effective way of expanding the original company's market abroad without over-committing oneself.
Definition of a liaison office: a liaison office is the least binding solution for a company wishing to study the French market. It is not authorized to carry out any commercial activity. On the other hand, it can begin any other type of activity, such as market research, prospecting or developing its network of contacts. They can then change their status at a later date, if they so wish. As a liaison office, registration with the RCS is not in itself compulsory, but it is highly recommended, as it enables you to obtain a Kbis certificate, which is very useful when dealing with third parties such as banks or suppliers.
A liaison office is a very good way to get started, as its structure gives the company a concrete idea of a potential future business in the country, while remaining very limited in terms of commercial activity.
When a foreign companysets up an establishment or a subsidiary in France, it has no choice but to register with the Répertoire des Entreprises et des Établissements, by requesting a creation file from the CFE (Centre de Formalités des Entreprises) on which it depends. This is usually at the Chamber of Commerce in the departmental capital. Depending on its activity, the company will have to follow the formalities for setting up a business, like any other French company, choosing the status that best suits it.
As explained above, if the option of setting up a subsidiary seems too daunting, the foreign company may decide to make a lighter start by creating a branch or liaison office. While these alternatives may seem more convenient, they are no less tricky, as certain steps still need to be taken.
After finding a registered office address and registering with the CFE, the establishment must register with the Registre du Commerce et des Sociétés (RCS), with URSSAF if it has employees in France, and with the tax authorities if it does not.
Setting up business in France can be very expensive. Buying a property can be very complicated and risky if you're not sure you're going to stay in France. Renting, too, can be expensive and full of administrative complications. Domiciliating your business via an online domiciliation company is a good solution to these problems. A monthly subscription to a domiciliation company is a much faster and more economical option, if you prefer to take the time to find premises or keep your main residenceabroad. The process is really simple, and takes just a few minutes.
Domiciliation with an online company also has many other advantages. First and foremost, it's an easy, low-cost solution, but it also has the capacity to offer you services that will make your day-to-day life easier. In fact, SeDomicilier.fr offers you additional services such as handling your switchboard, processing, scanning and forwarding your mail, and even renting premises or meeting rooms. All this, plus a prestigious French address, can only be a good start to your new business activities in a new country.
Written by our expert Daphné Savoye
June 30, 2017
