How to incorporate a Limited Company/ Societe a Responsabilite Limitee (Sàrl) in France
Select a name for your company, names can be in any language however, typically, foreign names should be avoided, adding the word France after the company name is usually perceived to mean you are a non-French company.
France is very liberal about which company names are allowed. All départements in France have a register of company names and most company names are allowed so long as it is not used by another company in the same département and so long as the name is not against public policy; an important distinction between France and other jurisdictions is that common names, such as Hôtel de la Gare Sàrl, will be repeated several times throughout the country.
Some local commercial courts may approve a name for incorporation, but may not register the approved names on the central register that we use, we will check your chosen company name with the Register of the Commercial Courts and the Institut National de la Propriété Industrielle free of charge and, once approved, we can reserve your Sàrl name for up to ten days.
Once the Sàrl name has been established, these are the steps in setting up your new company:
- Due diligence and drafting of the company documents
- Company’s incorporation at the court
- Upon receipt of the Certificate of Incorporation (Kbis) the bank account is activated
- Liaising with tax office to activate the VAT number
All companies incorporated in France have to register for VAT, we can register your company for VAT as part of the incorporation service.
What you need to incorporate a Limited Company/ Sàrl in France
To begin incorporation of your French Sàrl we will require the following:
- Your company name
- The full name, date of birth, address and nationality of all directors
- The full name and address of all shareholders
- Details of the marital status of any shareholders, including names of spouses
Documents you are required to provide:
- Proof of identity (passport, national identity card, photographic driving licence) certified copies
- Proof of residential address (gas/electricity bill or credit/debit card bank statement dated within the last three months) certified copies
- A company in France must have a Registered Office where official correspondence is sent this can be provided
- Alternative Address
- A written agreement by the owner of the property authorising the specific use of the address for the Registered Office of the company must be supplied to the French company registrar.
Shares and Share Capital
- Once the formation is completed and the company registration certificate is issued then the percentage shareholdings of each of the shareholders can be decided. It is not necessary that the shareholders be French, or that they reside in France.
- A Sàrl usually adopts a closed structure, meaning that share transfers only occur between existing shareholders or with the unanimous permission thereof.
- The minimum fixed share capital of a French Sàrl is rounded up to an amount which is easily divisible. The share capital requirement is only €1.
- The minimum number of shareholders in a Sàrl is one and they may be either an individual or corporate body. For each shareholder we shall need the following information:
- Corporation - full registered name, trading name, registered office address, company registration number, name and title of legal representative of the company
- Individual - name, home address, profession, date and place of birth, nationality, marital status and spouse details
Information on Directors
- A Director of a French company is not generally held to be an employee in that particular capacity, instead he is held to be solely an officer of the company.
- The Manager of a company is called a Directeur. In legal terms the French word ‘Directeur’ is not a translation of ‘Director’ but instead refers to a member of the board of a company. The importance of this linguistic distinction flows from the fact that because he is an ‘Administrateur’ and, as such, is solely an officer of the company and does not have a contract of employment with the company. Consequently the Directeurs and Administrateurs in general, do not benefit from the extremely protective provisions allowed for the employees of a company by French Employment Law.
- An Administrateur is generally able to be dismissed from his position without notice or compensation. In many cases, an Administrateur or Directeur of a French company might also have a contract of employment, but this would be considered, by French Law, to be totally separate from his role as an officer of the company. Such a contract of employment would relate to a specific function outside of the role of Directeur such as his duties as a Financial Manager, Sales Manager or Personnel Manager; this agreement would give the employee the full protection of French Employment Law provisions.
- The legal representative of a Sàrl company is called a Gérant; which is the equivalent of a director in other countries. You do not need to live in France to be a gérant of your company. If you wish to appoint a gérant who is not a resident of an EU or OECD member state, this person needs to hold a merchant's license or 'carte de commerçant'. These can be obtained through a French consulate in your chosen director's place of residence. This application is passed through the civil administration's regional office (the ‘préfecture’) in which your company is registered. We also need details of any criminal convictions or bankruptcies; which may be incompatible with holding the office of gérant.
What it costs to set up a Limited Company/ Sàrl in France
Setting up a French Sàrl will cost £3060; this includes all duties, taxes and professional fees.
What you receive after setting up your new business
- Original Certificate of Incorporation
- Original share certificates
- Original government receipt as evidence of payment of annual company registration and license fees
5 Advantages of Registering a Limited Company/ Sàrl in France
- Foreign directors of French companies benefit from French Social Security provisions. A foreign director of a French company is often automatically registered for French Social Security on incorporation, or on appointment; paying the contributions due for a self-employed person. Persons paying contributions in other EU countries, who are not residing in France, will not have to pay French Social Security to receive the same provision.
- Incorporating a Sàrl requires minimal capital investment. The share capital requirement is only €1.
- A Sàrl requires minimal infrastructure. A minimum of one director and one shareholder is required to incorporate a limited company in France; these can be the same person, can be of any nationality and need not be resident in France. Corporate shareholders are permitted
- French Sàrls do not require an annual general meeting of shareholders, if there are less than 25 shareholders.
- Under new regulations, the appointment of a French Chartered Accountant is now compulsory as only French CPA can do Annual Accounts and eReturns for VAT.
- All non EU residents are now required to apply for the government authorisation if they want to open a Sàrl in France; this includes applying for an Extract of Criminal Record which needs to be officially translated into French by a certified translator.
- The 'carte de commerçant étranger' is compulsory for those who hold directorships in a French company regardless of whether they reside in France or not. You can appoint anyone as gérant who are in the following categories:
- French citizens
- Those from a country which is a member of the OECD
- Those with long term or permanent residency in France with a ‘visa de long séjour’