Commercial domiciliation: everything you need to know

What is commercial domiciliation?

When you start your business, you need to choose an address for your company's registered office.

Domiciliation of a company: a legal obligation

Domiciliation is a legal obligation for companies: by law, all businesses must declare the address of their registered office and justify its use (Art. L. 123-10 et seq. of the French Commercial Code).

Domiciliation enables the entrepreneur to assign an administrative and legal address to his company, and thus determine the applicable law in the event of a dispute. It also defines the destination address for the company's mail and all its legal documents (invoices, contracts, declarations, etc.).

There are several options for domiciling your company:

• at your personal address: you can register your company at your personal address: this address can be used for administrative purposes only or also as your place of work;
• in commercial premises: it is possible to rent dedicated commercial premises and sign a commercial or professional lease;
• in a coworking space: a coworking space allows several companies to share a professional room;
• in a business incubator: a business incubator is an accommodation and support structure for young entrepreneurs;
• with a domiciliation company: domiciliation companies provide companies with a domiciliation address, as well as additional services such as administrative management.

How commercial domiciliation works

Commercial domiciliation is a service provided by a specialized company, known as a domiciliation company, which offers business addresses to other companies (corporate clients). Not only does it give you a prestigious address, it also enables you to benefit from interesting services. 

It applies to all companies, regardless of their legal form:

• multi-person companies (with several partners): SAS, SARL, SA ;
• single-member companies (with a single shareholder) : SASU, EURL;
• non-trading companies ;
• sole proprietorships ;
• micro-businesses.

Commercial domiciliation enables entrepreneurs to set up their company headquarters in a location suited to their activity, while benefiting from attractive rates.

Using the services of a domiciliation company like SeDomicilier is the ideal solution: simply choose a prestigious address from among those offered by the platform and sign your domiciliation contract directly online!

Why choose commercial domiciliation?

Commercial domiciliation is an advantageous option for entrepreneurs, since domiciliation companies offer formulas tailored to the needs of each company. They enable you to domicile your company at a prestigious address, different from your personal address, and thusenhance your image with your customers and partners.

What's more, depending on the package you choose, you can benefit from personalized support and additional services (mail management and forwarding, switchboard, legal support, etc.).

What are the advantages and disadvantages of commercial domiciliation?

Let's take a look at the advantages and disadvantages of commercial domiciliation.

Advantages of commercial domiciliation

This choice of domiciliation has many advantages:

• separating personal and professional life;
• benefit from a prestigious address;
• benefit from personalized support and additional services.

Separating personal and professional life

Being able to separate your private address from your business address is useful for two reasons: to protect your personal address and to avoid regulatory problems.

• Protect your personal address

When the address of your company's registered office is the same as your home address, it can be difficult to keep your private and professional lives separate.

Worse still, you're not safe from a disgruntled customer knocking on your door.

Confusing your home address with your business address also means that everyone needs to know exactly where you live. How can this be done? By typing your name into Google and finding your contact details via your company name. Your address is public, not just available to your customers or suppliers.

Commercial domiciliation allows you to protect your personal address.

• Not dependent on a landlord or condominium corporation

When you're a tenant living in a building you don't own, you're far from the only one in charge.

When it comes to domiciling your company in your own home, it's important to check your lease contract and co-ownership regulations. Both may contain a clause prohibiting the domiciliation of a company.

A prestigious address

The address of your business address is essential, as it represents the image of your company to your customers and partners.

The advantage of commercial domiciliation is the possibility of benefiting from a prestigious address at an advantageous rate. For just a few dozen euros a month, a company can obtain a prestigious address. In the majority of major French cities (Paris, Lyon, Marseille, etc.), domiciliation offers you the opportunity to locate your company in strategic business districts and benefit from unique visibility.

Benefit from additional services

Another advantage of commercial domiciliation is thepersonalized support and additional services offered by domiciliation companies.

Additional options include :

• mail management (reception, digitization and forwarding of mail) ;
• office rentals ;
• rental of meeting rooms ;
• switchboard ;
• drawing up quotations and invoices, etc.

The aim of a domiciliation company is not simply to provide a head office address. On the contrary, it can offer additional services to make day-to-day business easier.

These services enable entrepreneurs to delegate certain administrative tasks, allowing them to concentrate on developing their business.

Disadvantages of commercial domiciliation

However, commercial domiciliation can have a number of disadvantages:

• a sometimes high cost ;
• a minimum duration ;
• frequency of travel.

Cost of commercial domiciliation

Domiciliation companies offer competitive rates. It's even possible to be domiciled at a prestigious address for just a few dozen euros a month. However, don't forget to take into account additional services (mail management, switchboard, meeting rooms, etc.), which entail an additional cost.

That's why it's essential to find out about the rates charged by domiciliation companies, and any optional extras that may be added.

Minimum duration of 3 months

With a domiciliation company, there is no maximum duration, but a minimum duration of 3 months imposed by law. More specifically, article R. 123-168 of the French Commercial Code stipulates that the domiciliation contract "is concluded for a period of at least three months, renewable by tacit agreement, unless notice of termination is given".

Frequent travel

Domiciliation with a specialized company can mean frequent travel. Indeed, if the address you choose is far from your place of business or home, and if you haven't signed up for mail forwarding or scanning, travel can quickly become time-consuming.

What regulations apply to commercial domiciliation?

Commercial domiciliation is regulated by law on several points:

• the duration of the direct debit contract ;
• the mutual obligations of the parties ;
• signing a direct debit contract.

Duration of commercial domiciliation

As previously mentioned, the law stipulates that commercial domiciliation must be governed by a domiciliation contract, which must be concluded for a minimum period of 3 months, renewable by tacit agreement (unless notice of termination is given). It is therefore impossible to derogate from this rule, even if the parties are free to increase the duration of the contract.

Mutual obligations of the parties

Both the domiciliation company and the domiciled company have obligations to meet.

Obligations of the domiciliation company

In order to operate, the domiciliation company must comply with the following obligations:

• hold prefectoral approval (issued by the prefecture of the company's head office);
• provide the domiciled company, for the duration of the domiciliation contract, with premises in which it can effectively carry out its business;
• provide the relevant tax and social security authorities with a list of companies domiciled with us and those that have terminated their domiciliation contract.

Obligations of the domiciled company

The domiciled company must also comply with certain obligations:

• use the premises effectively and exclusively;
• inform the domiciliation company of anychanges to the company (legal form, corporate purpose, name, etc.);
• authorize the domiciliation company to receive mail on its behalf;
• declare the domiciliation contract to the Trade and Companies Register (RCS);
• comply with all the provisions of the domiciliation contract.

Conclusion of a domiciliation contract

Commercial domiciliation must be governed by a contract between the domiciliary company and the domiciled company.

To be valid, the contract must include certain mandatory information:

• the corporate name of the parties ;
• a description of the premises available to you;
• the services you have subscribed to ;
• obligations of the parties ;
• contract duration ;
• conditions for terminating the contract ;
• the annual cost to the domiciled company ;
• the amount of the security deposit ;
• the court competent to settle a dispute ;
• the address of the parties' registered office ;
• the date and place of signature of the contract for each party;
• signatures of the parties.

How much does a domiciliation company cost?

The cost of a business address depends on several parameters:

• the legal form of your company (micro-business, trading company, sole proprietorship, etc.);
• your company's location (Paris or province, business district, prestigious address, etc.);
• accessibility of the address (close to a train or metro station, in the Paris suburbs, etc.);
• selected services (mail forwarding, office and meeting room rental, switchboard, etc.).

Domiciliating your business through a domiciliation company costs from €11 per month with SeDomicilier for micro-businesses, and from €14 per month for companies.

Which domiciliation companies to choose?

There are a large number of domiciliation companies in France. To choose the right domiciliation company, you need to respect a few simple criteria: 

• the rate applied by the domiciliation company ;
• services offered ;
• minimum length of commitment ;
• contract termination conditions.

You should always bear in mind that you are required by law to holdshareholders' meetings, and that these should normally be held at the company's head office. 

The price charged by the domiciliation company is an important criterion, as the cost can vary by as much as double depending on the domiciliation company chosen and the options subscribed to. In addition, the services offered will enable you to tailor the package to your company's needs.

The duration of the commitment is also a key criterion. Before signing a direct debit contract, you should check the minimum duration of the commitment.

Finally, take a close look at the contract's cancellation conditions.

Cancellation may be conditional on sending a registered letter within a certain period before the contract renewal date.

How do you domicile your business using the services of a domiciliation company?

If you would like to use the services of a domiciliation company, simply follow the steps below:

• Choose a domiciliation company based on your needs and the services offered by the company;
• sign a domiciliation contract with the specialized company, for a minimum of 3 months, taking care to read all the terms of the contract carefully;
• register your company.

If there is a change in the life of your company, you must inform the domiciliation company of this change.

What are the consequences of not having a direct debit?

Domiciliating a company is a legal obligation. Failure to do so can have serious consequences if companies do not comply with these regulations:

• Rejection of registration: in the absence of a registered office, the company cannot be registered in the Trade and Companies Register (RCS) or the Trades Register (RM), and registration is rejected;
• refusal of administrative documents: in the absence of a registered office, the company is not registered and administrative documents (notably the Kbis extract) cannot be issued;
• legal penalties: failure to comply with regulations governing domiciliation exposes the company to heavy penalties, ranging from a simple fine to liquidation of the company and criminal sanctions (up to 3 years' imprisonment and a 45,000 euro fine);
• inability to carry on business: an unregistered company is not authorized to issue invoices or open a business bank account, making any commercial activity illegal.

Conclusion

Commercial domiciliation is an ideal solution. For just a few dozen euros, you can choose a prestigious address to dazzle your customers and partners.

But before entering into a domiciliation contract, it's essential to check that the domiciliation company is registered with the RCS (Registre du Commerce et des Sociétés), that it has prefectoral approval, and that it has Google reviews. There's nothing worse than contracting with a company that starts charging you hidden fees.