Company Formation in France

Advantages of Company Formation in France

Company formation in France offers numerous advantages, which can significantly simplify the often complex process of starting a business, depending on the type of activity and goals of the entrepreneurs.

First, France has well-developed sectors including services, agriculture, finance, industry, energy, and transportation. The government actively encourages investment, providing strong support for business development.

Second, France imposes minimal requirements for the share capital of the most common company type—limited liability company (SARL). Since 2003, the minimum capital requirement was abolished, and today EUR 1 is generally sufficient.

Third, France is actively modernizing its tax legislation, gradually reducing corporate tax rates, which provides advantages for business owners.

Fourth, France has modern corporate law. To simplify business formation, a simplified joint-stock company (SAS) is available, allowing entrepreneurs to establish a public company with minimal requirements.

Fifth, the registration process is straightforward, well-regulated, and does not require complex actions.

Sixth, as an EU member, France offers all EU benefits, from compliance with EU directives to broader European business policies and strategies.

Legal Forms of Companies in France

For company formation in France there are most commonly chosen the next company forms:

• Limited Liability Company (Société à responsabilité limitée – SARL)

Shareholders (minimum two) are liable only up to their contribution. This form is popular for small and medium-sized businesses. A single-shareholder SARL is called an EURL (Entreprise unipersonnelle à responsabilité limitée).

• Public Limited Company (Société Anonyme – SA)

Suitable for medium and large companies with no limit on shareholders. Requires a Board of Directors and annual audit. Minimum share capital is EUR 37,000. At least seven shareholders are required, with at least one being an individual. Shares can be freely transferred.

• Simplified Joint-Stock Company (Société par actions simplifiée – SAS)

Similar to SA but with fewer requirements regarding number of participants and minimum share capital. The share capital should be sufficient to cover long-term expenses, determined by the Articles of Association. SAS companies are increasingly popular among foreign investors.

Comparison of Common Company Forms in France

• Commercial Partnership (Société en nom collectif – SNC)

Partners, not shareholders, run this company. At least two partners are required, who are personally liable for company debts. No minimum share capital is required.

Company Formation in France: the Procedure

Registration is overseen by the Centre de Formalités des Entreprises (CFE) and the company registry. The French company registry is the Registre du commerce et des sociétés (RCS), accessible via Infogreffe.

To start registration, basic identification documents of the participants are required (contact our managers for details), along with:

1. 2–3 preferred company names;
2. Company structure (directors, shareholders, beneficiaries);
3. Type of business activity.

The registration process includes:

1. Verification and reservation of company name (usually 1 day).
2. Preparation and submission of a temporary bank account application for share capital. Recommended amount is around EUR 5,000, though the minimum is EUR 1. Access to funds is granted after registration certificate submission. Funds can be returned if registration is not completed.
3. Alternatively, registration can proceed without depositing share capital, which speeds up the process.
4. Publication of a company opening notice in official journals.
5. Preparation and submission of forms to the registration center, including notarized Articles of Association, usually in French.
6. Company registration (approx. 5–10 business days).
7. Preparation of corporate documents and company seal (2–4 days).
8. Certification and apostille of documents if needed (certification 1–2 days, apostille 1–5 days).

Company Formation in France: Key Features to Consider

• Every company must obtain a KBIS extract from the Registre du commerce et des sociétés (RCS). This official document contains essential information about the company and certifies its legal existence. Banks require this extract to grant access to the company’s share capital. The KBIS extract confirms the company’s legal existence, registered address, business activity, management bodies, and more. Anyone can request and obtain a KBIS extract.
• When registering a company and depositing share capital, be aware of strict bank requirements. While the minimum share capital for most company types is symbolic (EUR 1), depositing capital can enhance the company’s credibility with banks and partners. To open a corporate account successfully, it is recommended to deposit around EUR 4,000 – EUR 6,000, which can later be used for company expenses. French banks are strict, so compliance with their requirements is crucial.

Corporate Taxation in France

Corporate tax in France depends on the company’s residency. A company is considered a French resident if it is incorporated in France or controlled and managed from France.

• Corporate Income Tax (impôt sur les sociétés – IS): The corporate tax rate in France (as of 2025) is 25%, with a reduced rate of 15% on the first EUR 42 500 of profit for SMEs (small and medium sized enterprises).
• Value Added Tax (VAT): Standard rate 20%. Reduced rates apply to medicines, public transport, hotel and catering services, sports and cultural tickets, food, books, and newspapers.
• Dividend Tax: Dividends paid by a French‑resident company to non‑resident individuals are subject to a 12.8% withholding tax, and to non‑resident companies at 25%, unless a treaty provides otherwise. Dividends paid to an EU parent company by a French subsidiary are exempt.
• Digital Services Tax: Introduced in 2019 at 3% for large enterprises with global revenue over EUR 750 million and French digital revenue over EUR 25 million. Applies to:
  1. Online advertising
  2. Sale of user data for advertising
  3. Online intermediation platforms

Filing and Reporting in France

All companies incorporated or operating in France must submit annual financial statements. The report must fully reflect the company’s performance over the fiscal year. By default, the fiscal year aligns with the calendar year, but it can be changed. The reporting period is 12 months.

Companies generally have around six months to submit the report, with the deadline usually falling between May and June.

Audit is required only for large companies or when established thresholds are exceeded (check with our specialists). Companies of the SA and SAS types must conduct an audit annually, whereas for SARL it is necessary only if the turnover exceeds the allowed limits.

Conclusion

In France, there is a clear trend toward simplifying the process of establishing and running a business, making company formation in France easier each year. Plans by the Ministry of Economy and Finance to reduce tax rates make the country even more attractive to entrepreneurs, providing a favorable and business-friendly environment with broad opportunities for growth.