The main steps to follow when starting a business in France as a foreigner

With a strong economy, a highly skilled workforce, and a business-friendly environment, France has many opportunities for entrepreneurs. To help you settle in our country, this page provides a comprehensive guide to the main steps involved in setting up a business in France as a foreigner.

France has long been known for its rich culture, beautiful scenery, and delicious cuisine. But in recent years, it has also become an attractive destination for foreign entrepreneurs. How do you open a business in France? Follow our guide and feel free to contact us if you need any further help.

Overview of the French business environment

Before starting your business in France, it is important to understand the local business environment. France has a mixed economy, with a combination of private enterprise and state intervention. The country is home to many successful multinational companies, as well as a thriving start-up scene.

France has long been a popular destination for foreign entrepreneurs looking to start or expand their business. The country has been in the top 3 in Europe for several years, and in 2022, France saw a record number of international investments within 1,725 projects.

One of the main reasons why France is such an attractive destination for foreign entrepreneurs is its strategic location. France shares borders with several European countries, making it a natural gateway to the wider European market. This, combined with the country’s excellent transport infrastructure, makes it easy for businesses to access customers and suppliers across the continent.

France is one of the largest economies in Europe and is home to many multinational companies. The country’s stable political climate, advanced legal system and strong public institutions make it an attractive destination for businesses looking to invest in a safe and reliable market. In addition, France has a highly skilled workforce and is home to some of the world’s leading universities and research centres. 

When it comes to the French business environment, the country is renowned for its strong entrepreneurial culture and innovative spirit. France is home to a thriving start-up scene, particularly in the technology and digital sectors, and a number of business incubators, accelerators and innovation hubs; all of which provide support and guidance to start-ups and entrepreneurs looking to grow their businesses. Would you like to join them in setting up your business in France? See the steps below to find out how.

Registering your business in France 

Once you have chosen the name and legal structure of your new company, you will need to register your business with the relevant authorities. To do this correctly, we strongly recommend that you seek the assistance of a legal firm. The main steps involved in registering your company in France are:

• Obtain a SIRET number: This is a unique 14-digit identification number allocated to all businesses in France and is issued by the National Institute for Statistics and Economic Studies (INSEE). You must provide information about your business, such as its name, address, legal form and activity. The SIRET number makes it possible to certify the legal existence of the company, and customers as service providers can therefore verify the reliability of the data.
• Register with the Chamber of Commerce: The Chamber of Commerce is a network of regional organisations that promote economic development. In France, all businesses are required to register with the Chamber of Commerce in their region within 15 days of starting business. This allows for access to a range of services including business advice, networking events and training opportunities.
• Obtain any necessary permits and licences: Depending on your business activity, you may need to obtain certain permits or licences from the relevant authorities. For example, if you are opening a restaurant, you will need a food hygiene certificate.

Open a bank account for your business in France

Opening a bank account is an essential step in setting up a business in France as a foreigner. It is important for your business to have a bank account in order to manage your finances, pay taxes, receive payments from customers and carry out transactions with suppliers. Specific requirements may vary depending on the bank and the type of business, but in general you will need the following:

• A valid form of identification, such as a passport or national identity card
• Proof of address, such as a utility bill or rental agreement
• Your business registration documents, including your SIRET number and Chamber of Commerce registration certificate
• Information about your business activities, including industry, turnover and number of employees
• Information on the legal structure of your business
• Your tax number and VAT number (if applicable)

Choosing the right bank for your business is an important decision that can have a significant impact on your financial management and operations. There are several factors to consider when choosing a bank, including the bank’s reputation, fees and charges, services and products, and accessibility.

How to open a business in France: hiring employees

Hiring employees is an important step for companies looking to establish a presence in France. First, you have to understand French labour laws, which are designed to protect employees and ensure fair treatment in the workplace. As such, employers in France must comply with a number of legal requirements, including minimum wage laws, maximum working hours and health and safety regulations.

The process of hiring employees in France involves several steps. First, the employer must make a written offer of employment to the applicant, setting out the terms and conditions of the employment contract. Once the offer is accepted, the employer must register the employee with the French social security system and obtain a health insurance certificate. Employers must also provide new employees with a copy of their employment contract, which outlines their rights and obligations under French labour law.

Employers in France must comply with payroll requirements, including withholding taxes and social security contributions from employees’ wages. They must also provide employees with various benefits, such as paid holidays, sick leave and maternity leave.

Termination of employment in France is obviously subject to rules and regulations protecting both parties. Employers must therefore follow specific procedures to terminate an employee’s contract, including providing written notice of termination and following the correct dismissal procedures.

Taxes and accounting for your company in France

In France, companies are subject to corporate income tax on their profits. However, there are various tax credits and deductions available for international companies, such as research and development tax credits and tax deductions for charitable donations. The standard VAT rate in France is currently set at 20%, with reduced rates of 10% and 5.5% applied to certain goods and services such as food, books and pharmaceuticals.

French law requires companies to keep accurate and up-to-date financial records, including profit and loss accounts, balance sheets and cash flow statements. Companies must also file annual accounts with the French authorities, which must be audited by an independent accountant. In addition, businesses in France must comply with accounting requirements, such as maintaining a chart of accounts and keeping records of invoices and receipts. Employers must also keep accurate records of employee salaries and benefits.

Business culture and networking in France

France has a unique business culture with a strong emphasis on formality and respect for hierarchy. Business meetings tend to be structured and formal, with a clear agenda and established protocols. French business people also tend to be more reserved and cautious in their communication, preferring indirect language and subtlety to directness and bluntness.

French is the official language of business in France, and knowledge of the language is essential for effective communication. However, many French people also speak English and it is becoming increasingly common for businesses to conduct meetings and negotiations in English. When communicating with French business people, it is important to be polite, formal and respectful.

Networking is an essential part of doing business in France, and there are many ways for entrepreneurs to connect with others in their industry. Professional associations and industry groups are popular venues for networking, and there are also many business events and trade fairs held throughout the year.

Are you looking for information on how to set up a business as a foreigner in France and do you still have questions? 

Contact us now for personalised support.