Opening a company is a big leap forward for many would-be entrepreneurs, but the jump doesn’t need to be so daunting if you’re armed with the right information. Opening companies in France is what we do every day, so you can trust our information to be up-to-date and correct, as we really know our French business! So, for those that want to get on the road to starting a business in France, we’ve compiled a helpful list of the 8 steps you’ll need to take to put you on the French map.
Basics to starting a business in France
Anyone can set up a business in France. You do NOT need to be a resident or be an EU citizen to become a French business owner. It can help, but if you live and work outside the EU, you can still open a company in France by simply registering a business address in France. That could mean opening a virtual office or finding actual premises for your business. You certainly don’t have to buy a house or change your citizenship!
Step 1: Writing a French Business Plan
You should always start by creating a business plan. Whether you're planning to open a small business in France or dreaming of a bigger slice of the French market, a business plan allows you to clarify your mission statement and vision for your business, and means you can show investors – and more importantly the French business bank account manager – exactly how your business will run. (It goes without saying that this business plan will need to be translated into French.)
You will need to consider who your market and customers will be in France, how much money you or your partners will be investing, what business experience you have and how much money you are likely to make and spend during the next few years.
For more information on how to structure a good plan, click here on our article on how to write the best French business plan written by Paris entrepreneur Dawn Bournand.
Step 2: Choose the By-laws & Structure of Your French Company
Next, you’ll need to choose the type of company structure for your business. It's important to do your homework here as you'll need to find the structure that fits with the type of business you have and the amount of turnover your business does.
The most common structures in France are:
- EURL - owned by a single person and run as a limited liability single shareholder company.
- SARL – which is the equivalent of a French limited company, or Ltd or LLC company.
- SAS – which is a Simplified Stock Company; this type of company is ideal for foreign investors who do not want to become resident in France.
- Branch – if you want to extend your existing business and register it as a branch in France.
If you want some great in-depth information about what exactly each of these types of structures are, please consult our article: What's the difference between a SARL, SAS, SA, EURL, Micro-Entreprise & Auto-Entrepreneur?
Then you have to register your by-laws, either with an affordable registered company formation agent or with a lawyer (although lawyers are generally much more expensive!) This includes being specific about your business – what products you’ll sell or what services you want to provide.
In France, businesses are split into different categories:
- Commercial or industrial – retail such as shops and factories; food such as cafés or restaurants; consulting and services; import and export;
- Trades/artisan, - art and crafts, building and manual trades and certain types of manufacturing;
- Independent or freelance professional – working independently and providing a service for individuals or companies;
These categories have their own registration centres based in the area you wish to set up:
- the Centre de Formalités des Entreprises (CFE)
- the Chambre des Métiers et de l’Artisanat (CMA)
- the Chambre d’Agriculture (CA)
It’s important to have a clear idea of what your business is and have some vision for what your business hopes to become in the future because every time you branch out into something new with your business, you’ll have to inform the CFE, CMA or CA.
If you belong to certain professions such as therapists, accountants, builders, doctors, dentists, vets, lawyers – basically anything that requires certain qualifications before you can work with people – you’ll need to make sure you are registered under the French professional organisation in order that you qualify for the right insurance.
Step 3: Set up a French Business Bank Account
Next, you’ll need a business bank account. It is possible to open bank accounts remotely now (especially due to travel restrictions since the global pandemic), so once you’ve arranged your bank account introductions with a bank manager, you need to be prepared to go through your business plan and answer any questions about your company.
French bank account managers can be very exacting about who they allow to open an account due to stringent laws to prevent money laundering. This is where your business plan comes in very handy as it puts an account manager’s mind at ease if he can see all the facts in figures laid out.
For more information on how to open a bank account easily without any fuss, see our useful article: Business Banking in France - What NOT to Do.
Step 4: Deposit Capital in Your French Bank Account
For a EURL, SARL or SAS, the minimum share capital has been reduced to €1 but banks require more than this figure to set up an account.
The traditional share capital was 7,500 euros but a minimum amount could be deposited of around 4,000 euros. Please bear in mind that this is "working capital" and can be taken out of the account for use at any time.
Your share capital will be unblocked as soon as the banker receives the Kbis – the certificate of your new company - which normally takes about two weeks. If you end up not going through with the company formation, then your capital will be returned to you immediately.
Step 5: Legal Publicity of Your New French Business
Next comes a quaint French rule of announcing the opening of your company in the press. You have to publish an announcement in an authorized newspaper such as Le Parisien or Les Echos or a business publication so that your company is formally and publicly introduced into the business world.
Step 6: Incorporation of Your French Business
There are various documents and evidence you’ll need to get together to incorporate your French company. You will need a completed application form, a certified copy of each director/shareholders passport, and two utility bills that are less than three months old to prove addresses (cell phone bills are not accepted.)
These documents will then need to be sent to various administrations including the National Institute of Statistics and Economic Studies (INSEE), which will register your company with the national business directory. Your documents will also need to go to the tax office - the Centre des Impôts – and the commercial court called the Greffe du Tribunal de Commerce.
To make sure you’re paying the right pension and labour payments, the social security office (URSSAF) will need to be informed as well as the Caisses Sociales and Inspection du Travail if you are employing or recruiting staff and the Centre des Formalités des Entreprises or Chambres des Métiers.
Once your documents have gone to all the right government departments, your application will receive all the official stamps that formalises your French company incorporation.
As you can see there are quite a few stages to go through, but if you have the help of a French company formation agent then all these can be done very easily without the need for going backwards and forwards to government departments or speaking to officials in a foreign language. Then with the time you have freed up, you can take advantange of any small business opportunities in France to put your stamp on the market.
In terms of timescales, incorporation usually takes up to two weeks from the time the bank account is opened (as long as all the paperwork is in order) and VAT registration takes up to two weeks.
Step 7: Registering A Business in France
When you receive the ‘Extrait Kbis’ (the certificate of incorporation) you will be provided with a unique 14-digit registered number comprised of a SIRET and SIREN number which is your company ID number that must be written on all official documents, invoices and websites. These are the most important numbers you need when registering a business in France.
The SIRET is your 9-digit SIREN number plus a 5-digit code specific to your company. You will also have an APE (Activite Principale de l’Entreprise) or NAF code which identifies the main activity of your business.
Once the Kbis arrives, your bank manager can activate your business bank account and your share capital will be unblocked. You will also receive a welcome letter from the tax office with a VAT number and tax officer contact details. Your VAT number starts with the letters FR plus a 2-digit code followed by your SIREN.
If you wish to import and export goods internationally, you will need to apply for a EORI number with the French Customs Authorities. For more information take a look at our article: The EORI number explained: what it is and why you need it to trade
Step 8: Find An Accountant in France
French tax law and accountancy can be especially complicated when you’re from a foreign country. Instead of getting into difficulties, the best way to save yourself from trouble from the French tax man, is to appoint a professional French accountant called an ‘expert comptable’. They will be a regulated professional who is legally obliged to keep you up to date with all the tax laws and is held legally responsible for the good standing of your accounts. He can also help you with VAT returns and payrolls.
The next steps
If all this has piqued your interest into starting a business in France, then the next step is for you to download our free in-depth 11-page guide which is featured at the end of this article. Alternatively, you can take a look at our video guide to Starting a Business in France which will lead you through all of the steps in a clear and concise manner so you have absolutely everything you need to get your new French business off the ground from registering a business address, opening a bank account, tax planning or advice, or finding an accountant.
We also have lots of how-to guides about starting up different businesses in France including:
- How to open a restaurant in France
- How to start a holiday cottage or gîte business in France
- How to start a clothes shop in France
- How to start a wine business in France
- How to start a web design business in France
- How to start a life coaching business in France
And of course you are welcome to email us through our contact page or call us on 0033 (0)1 53 57 49 10 if you’d like to open your French company the easy way by letting us organise all the paperwork, translations and do all the hard work for you.