A foreign company starting business in France usually hesitates between three options: incorporating a French subsidiary, registering a branch of the foreign company, or opening a liaison office. The right choice depends on the activity, the level of risk, the tax position and how the French operation will be managed.
Option 1: a French subsidiary (usually an SAS)
A subsidiary is a separate French legal entity owned by the foreign parent. The most common form is the société par actions simplifiée (SAS), or SASU when there is a single shareholder.
- Limited liability: the parent company’s risk is in principle limited to its contribution.
- Flexible governance: the articles of association freely organise management; the president may be an individual or a company, resident in France or abroad.
- No minimum share capital, although the capital should be consistent with the planned activity.
- French corporate tax on the subsidiary’s profits, with its own accounts and annual approval of accounts.
- Credibility with French customers, suppliers, banks and employees.
Option 2: a branch (succursale)
A branch is a French establishment of the foreign company, registered with the French trade and companies register, but without separate legal personality.
- The foreign company is directly liable for the branch’s commitments.
- The branch is generally taxed in France on the profits attributable to its French activity; specific tax rules may apply to branch profits depending on the country of the parent and applicable tax treaties.
- The foreign company’s documents must be filed, translated where required, and kept up to date.
Option 3: a liaison office
A liaison or representative office may only carry out preparatory or auxiliary activities (market research, information, contacts). It cannot enter into commercial transactions. It is a testing solution rather than a structure for doing business.
How to decide
- Will you sign contracts and invoice French customers? A subsidiary or a branch is required.
- Do you want to ring-fence liability? A subsidiary is usually preferred.
- Will you hire in France? A subsidiary makes employment, payroll and banking simpler in practice.
- What is the tax position? The choice should be confirmed with a tax adviser in both countries.
In practice, most foreign technology, service and commercial companies choose a French SAS.
Timeline and practical points
The timetable depends on document preparation (registry extracts, translations, apostilles), the registered office, the share-capital deposit and bank compliance checks. Banks carry out their own know-your-customer reviews, and no bank account can be guaranteed. Planning these dependencies early avoids most delays.
Fixed-fee support with France Company Launch
France Company Launch is the firm’s fixed-fee service for foreign companies. It starts with a €490 Entry Review: a meeting in English and a written decision memorandum comparing a subsidiary, a branch and a liaison office for your project. Incorporation and 90-day coordination packages are then offered at fixed fees agreed in writing before work begins.