You live in London, New York, Dubai or Singapore and you want to sell, hire or invoice in France without moving there. Should you create a French SAS, a SARL, a full subsidiary of your foreign company, or simply register a branch, called a succursale in French? The answer decides who is liable for French debts, how you are taxed, whether you can open a bank account quickly, and how easily you can close the structure later. This guide explains the choice in plain English for a business reader, with every French acronym explained, and gives you the registration steps, the tax and hiring basics, and the remedies when the registry, the bank or the tax office says no.
French company law looks simple from abroad and turns out to be procedural. The commercial court registry, called the greffe du tribunal de commerce, does not negotiate. The single filing portal, called the guichet unique and run by the INPI, the Institut national de la propriete industrielle, rejects incomplete files. The company extracts, called extrait Kbis, prove that your company exists. The social security collection body, called URSSAF, and the official gazette for company filings, called BODACC, the Bulletin officiel des annonces civiles et commerciales, follow. Understanding the vehicle before you file saves months.
This article covers first the choice of vehicle and its liability logic, then the practical path from filing to Kbis, bank account, VAT number, known in France as numero de TVA intracommunautaire, and first hire. It cites the Commercial Code, the General Tax Code, the Monetary and Financial Code and the Labour Code as verified on Legifrance, and recent decisions of the Cour de cassation, the French supreme court for civil and commercial matters. It also links to the companion guides on forcing a French bank account open from abroad and on the annual legal calendar of a French company.
I. Which French vehicle should a foreign founder choose: SAS, SARL, subsidiary or branch?
A. How do SAS and SARL allocate power, liability and capital for a foreign owner?
The two standard French limited liability companies are the SAS, societe par actions simplifiee, and the SARL, societe a responsabilite limitee. Both shield shareholders from losses beyond their contributions, but they organise management in very different ways.
The SAS is defined by Article L227-1 of the Commercial Code: “Une société par actions simplifiée peut être instituée par une ou plusieurs personnes qui ne supportent les pertes qu’à concurrence de leur apport.” The English meaning is that one or more persons may form a simplified joint-stock company and bear losses only up to their contributions. When there is a single shareholder the company is called a SASU, societe par actions simplifiee unipersonnelle. The statutes, called statuts, can allocate with wide discretion voting rights, vetoes, preferred shares and management roles. That flexibility explains why foreign groups and startups almost always choose SAS for a French subsidiary.
The SARL is defined by Article L223-1 of the Commercial Code: “La société à responsabilité limitée est instituée par une ou plusieurs personnes qui ne supportent les pertes qu’à concurrence de leurs apports.” The meaning is identical on limited liability, with a single-member version called EURL, entreprise unipersonnelle a responsabilite limitee. The difference lies in rigidity. Managers, called gerants, are appointed and removed by shareholders under statutory majorities, transfers of shares to third parties require approval, called agrement, and preference shares with multiple votes are not available. For a family business or a joint venture where the foreign founder wants statutory protection against dilution, that rigidity can be an advantage. For a fast fundraising vehicle, it is usually a drawback.
Capital rules confirm the contrast. In a SARL, Article L223-7 of the Commercial Code provides: “Les parts sociales doivent être souscrites en totalité par les associés.” Shares must be fully subscribed. Cash contributions must be paid up by at least one fifth on formation, the balance within five years after registration. Contributions in kind must be fully paid up immediately. In a SAS the minimum capital is also unrestricted and can be one euro, but shares in cash must be paid up by at least one half on formation, the balance within five years. In both cases the funds must be deposited with a bank, a notary, called notaire, or the Caisse des depots before signature of the statutes, and the deposit certificate, called attestation de depot des fonds, is required for registration. Founders who act too early without care face personal liability, as explained below.
Management powers against third parties are also statutory. In a SAS, Article L227-6 of the Commercial Code provides: “Le président est investi des pouvoirs les plus étendus pour agir en toute circonstance au nom de la société dans la limite de l’objet social.” The president holds the broadest powers to act in all circumstances in the name of the company within the limit of the corporate purpose, called objet social. Limits written in the statutes, such as a cap on spending or a requirement for shareholder approval, bind directors internally but cannot be raised against a good-faith third party. The same logic applies to SARL managers within the corporate purpose. Foreign owners should therefore draft the objet social broadly enough to cover the real business, publish the identity of the president or gerant correctly, and avoid appointing a hidden manager, called gerant de fait, who acts without authority.
The Cour de cassation enforces the pre-registration period strictly. In three judgments of 29 November 2023, Commercial Chamber, appeals Nos. 22-21.623, 22-18.295 and 22-12.865, ECLI:FR:CCASS:2023:CO00757 and related cases, available at Cour de cassation through the Judilibre database, the Court recalled the rule now codified in Article L210-6 of the Commercial Code: “Les sociétés commerciales jouissent de la personnalité morale à dater de leur immatriculation au registre du commerce et des sociétés.” Commercial companies acquire legal personality only on registration with the trade and companies register, called registre du commerce et des societes or RCS. The Court added, in a passage that founders should read twice: “sont tenues solidairement et indéfiniment responsables des actes ainsi accomplis, à moins que la société, après avoir été régulièrement constituée et immatriculée, ne reprenne les engagements souscrits.” Persons who acted before registration remain jointly and indefinitely liable unless the company, once duly formed and registered, takes over the commitments. And: “Ces engagements sont alors réputés avoir été souscrits dès l’origine par la société.” Taken-over commitments are deemed to have been entered into by the company from the start.
The same judgments refine the formalism. Only commitments expressly entered into “au nom”, in the name of, or “pour le compte”, on behalf of, the company in formation can be taken over after registration. An act signed merely “par”, by, the future company is void and cannot be rescued by showing that everyone intended to act for it. For a foreign founder this is concrete. Every lease, service contract or purchase signed in Paris before the Kbis arrives must state that it is signed in the name of or on behalf of the SAS or SARL in formation, list the future registered office, and be annexed to the statutes or approved by a separate takeover decision after registration. Without that sentence, the founder stays personally liable and the company cannot simply ratify later.
A practical consequence follows for group structures. A French subsidiary, called filiale, whether SAS or SARL, is a separate French legal person owned by the foreign parent. Its losses normally stay in France. A French branch, called succursale, of a foreign company has no separate legal personality. It is the same foreign person acting in France through a local establishment, registered with the RCS but without its own capital. Creditors in France can pursue the foreign head office directly, and French courts can serve process at the branch address. A branch avoids issuing new shares and can be faster to open for a test phase, but banks, landlords and large customers often prefer a subsidiary with a Kbis showing French capital and a French president. Tax follows the same divide, as explained in Part II.
Intra-group flexibility also differs. A SAS subsidiary can issue different classes of shares, convertible bonds and warrants to the foreign parent and to French managers, with vesting and leaver clauses in the statutes or in a shareholders agreement, called pacte d’associes. A SARL subsidiary can do less. A branch cannot issue shares at all, cannot easily incentivise a French manager with equity, and cannot join a French tax consolidation in the same way. If the plan is to hire, raise funds or sell the French business within three years, a SAS subsidiary is usually the right container. If the plan is to perform one contract for six months with two secondees, a branch or even a posting without any local entity, with SIPSI declaration, may be lighter, but that posting logic belongs to a separate guide and triggers its own labour and social security filings.
B. When does a branch help and when does it expose the foreign head office?
A branch is useful when the foreign company wants a visible French address, a SIREN number, called Systeme d’identification du repertoire des entreprises, and the ability to hire and invoice French VAT without creating a new company. Registration still goes through the single portal defined by Article L123-33 of the Commercial Code on the guichet unique, with proof of the foreign company’s existence, translated and apostilled where needed, the appointment of a local representative, called representant en France, and a French address for the establishment. The branch receives its own SIRET number, called Systeme d’identification du repertoire des etablissements, for the premises, files its foreign parent accounts in France in many cases, and must keep French business records available for audit.
The exposure is direct. Because the branch has no legal personality separate from the head office, French contracts, employment claims, tax assessments and tort claims arising from the French activity can be enforced against the foreign company’s assets within the limits of private international law and treaties. Limitation clauses in the statutes of the parent do not shield the branch. Closing a branch still requires deregistration, employee information and consultation where thresholds are met, landlord settlement and tax clearance. Founders sometimes imagine that a branch can simply be abandoned. The registry, the tax office and URSSAF treat abandonment as continued activity until formal radiation, called radiation, is published.
The subsidiary route contains the risk. The parent loses only its equity and shareholder loans unless it gave guarantees, comfort letters, called lettres de confort, or managed the subsidiary as a shadow director. French courts can extend liability in insolvency for management fault or for confusion of assets, called confusion des patrimoines, but they require proof. Day-to-day French creditors contract with the SAS or SARL shown on the Kbis, not with the Delaware LLC, the English Ltd or the Dubai holding. That separation reassures French counterparties and makes it easier to open the bank account, to obtain supplier credit and to sell the shares later.
Governance from abroad must still be real. A non-resident president of a SAS or a non-resident gerant of a SARL can legally manage from abroad if the statutes allow remote decisions, but the company needs a French registered office, called siege social, which can be a commercial lease, called bail commercial, a derogatory short lease, called bail derogatoire, or a domiciliation contract with an approved provider, called entreprise de domiciliation. It must declare its beneficial owners, called beneficiaires effectifs, at the RCS. Article L561-46 of the Monetary and Financial Code provides that companies “déclarent au registre du commerce et des sociétés, par l’intermédiaire de l’organisme mentionné au deuxième alinéa de l’article L. 123-33 du code de commerce, les informations relatives aux bénéficiaires effectifs.” In practice the foreign individual holding more than twenty-five percent or exercising control must be identified with personal domicile and control terms. Failure to file blocks later steps and can lead to a court order with daily penalties, called astreinte, against the manager.
The choice can be summarised for a foreign board. Choose a SAS subsidiary when you plan to hire, to sign multi-year contracts, to protect the head office, to incentivise staff or to sell later. Choose a SARL subsidiary when you want a close company with statutory approval clauses and a simple manager regime, often for a family or a single-owner operational company. Choose a branch when you need speed for a defined mission, accept direct liability of the head office, and do not need French equity tools. In all three cases registration creates the person or the establishment, the Kbis proves it, and acts signed before that date must use the in-formation wording recalled above.
Remedies exist when the registry blocks you. If the guichet unique declares the file incomplete, complete it within the deadline and keep the receipt, called recepisse. If the greffe refuses registration on the ground that the name is unavailable, that the activity is regulated or that a document is missing, ask for a written reason, correct the exact point, and refile. If the refusal persists without legal basis, an action before the supervisory judge, called juge commis a la surveillance du registre, can order registration. Do not start trading durably without the Kbis. Insurance, called assurance, hiring and VAT charging all assume registration, and operating without it aggravates personal liability.
II. How do you register, fund, tax and staff the French structure from abroad?
A. How do you get the Kbis, the bank account, the VAT number and the tax status without flying to France?
Registration follows one pipeline. Draft the statutes in French, decide the corporate name, called denomination sociale, the registered office, the purpose, the capital and the manager, deposit the cash capital and obtain the deposit certificate, sign the statutes, publish a formation notice in a legal gazette, called journal d’annonces legales, then file everything on the guichet unique. The portal forwards to the greffe, to INSEE for SIREN and SIRET numbers, to the tax office and to URSSAF. When the file is regular and complete, the greffe registers the company and issues the Kbis. The whole chain can be done with a French lawyer under powers of attorney, called procurations, with apostilled identity documents and certified translations. The foreign founder does not need to be resident in France to be a shareholder, and since recent reforms no longer needs a prior residence permit to be a president or manager, although regulated activities, banking, defence, health and others still require approvals, called agrements.
Capital deposit is the first practical hurdle from abroad. French banks must verify identity, beneficial ownership and source of funds under anti-money-laundering rules before issuing the certificate. Some banks refuse non-resident files or impose long delays. The file should include the draft statutes, the foreign company’s registry extract with translation, the beneficial owner chart, proof of address and source-of-funds evidence. If every bank refuses a deposit account, a notary or the Caisse des depots can receive the funds. After registration, the funds are released to the company on presentation of the Kbis. The judgment of the Commercial Chamber of 18 December 2024, appeal No. 23-10.695, ECLI:FR:CCASS:2024:CO00770, available at Cour de cassation, illustrates how strictly French courts read company statutes on withdrawals and repayments. Founders should not treat deposited capital as immediately available petty cash. Any withdrawal before release requires the legal procedure for the chosen vehicle.
After the Kbis, open the operating account. A company with a Kbis, SIREN, statutes and beneficial owner filing can be refused by a bank for commercial reasons, but it is not left without remedy. Article L312-1 of the Monetary and Financial Code organises the right to an account, called droit au compte: “A droit à l’ouverture d’un compte de dépôt dans l’établissement de crédit de son choix, sous réserve d’être dépourvu d’un tel compte en France”. A person without such an account in France has the right to opening of a deposit account with the chosen bank. The company asks the Banque de France to designate a bank after one refusal documented in writing. The designated bank must provide basic services. In practice, apply to two or three banks in parallel, keep written refusals, and trigger the procedure quickly rather than waiting months. Online banks and payment institutions, called etablissements de paiement, can bridge the gap for transfers and direct debits, called prelevements, but payroll, called paie, and tax payments are simpler with a full French IBAN.
Tax status follows automatically but must be understood. Article 206 of the General Tax Code provides: “sont passibles de l’impôt sur les sociétés, quel que soit leur objet, les sociétés anonymes, les sociétés en commandite par actions, les sociétés à responsabilité limitée n’ayant pas opté pour le régime fiscal des sociétés de personnes dans les conditions prévues au IV de l’article 3 du décret n° 55-594 du 20 mai 1955 modifié”. SAS and SARL companies are liable to corporate income tax, called impot sur les societes or IS, whatever their activity, unless they validly opt for partnership taxation in narrow cases. The standard rate is twenty-five percent, with advance instalments, called acomptes, and a balance. A branch of a foreign company is also liable to IS on French-source profits attributable to the French establishment, with transfer pricing documentation where it deals with the head office. Choosing a branch does not avoid French corporate tax on French profits. It only changes how profits are computed and repatriated, since a branch has no dividends, only remittances, called remontees, while a subsidiary distributes dividends subject to withholding, called retenue a la source, unless a treaty or the EU parent-subsidiary regime applies.
VAT must be activated separately in the mind of the founder even though the SIREN is single. Article 256 of the General Tax Code provides: “Sont soumises à la taxe sur la valeur ajoutée les livraisons de biens et les prestations de services effectuées à titre onéreux par un assujetti agissant en tant que tel.” Supplies of goods and services for consideration by a taxable person acting as such are subject to VAT. A French SAS or SARL that sells in France charges French VAT, files returns, called declarations de TVA, and recovers input VAT, called TVA deductible, on its costs. A foreign company with only a French branch may need a French VAT number for the branch operations. A foreign company without any French establishment that sells goods located in France or certain services to French customers may still need to register for VAT in France through the foreign-operator desk, called guichet des operateurs etrangers, and to appoint a tax representative, called representant fiscal, if it is established outside the European Union. E-invoicing, called facturation electronique, and e-reporting add a further calendar that the companion VAT guide details.
Do not forget the parallel filings that make the company usable. Declare the beneficial owners at formation and update them within thirty days of any change. Register the company with URSSAF as employer even before the first hire if hiring is planned. Affix the SIREN and RCS mention, the share capital and the registered office on invoices, quotes, called devis, and the website legal notice, called mentions legales. File the parent company’s accounts for a branch where required. Insure professional liability, called responsabilite civile professionnelle, and office risks from the start date of the lease. Each of these steps can be done from abroad with scanned signatures and electronic filing, but each has its own deadline and its own fine.
When the administration says no, act in writing. If the tax office delays the VAT number, send the Kbis, the lease and a first invoice or contract proving activity, then refer to the SIE, the Service des impots des entreprises, with acknowledgement of receipt. If INSEE delays the SIREN, use the guichet unique receipt to prove filing and relaunch. If a bank delays the capital release after the Kbis, send the Kbis by recorded delivery and set a short deadline. Every challenge later, before the tax judge, the social security judge or the commercial court, starts with these letters, dates and receipts. Foreign founders who keep a clean paper trail from abroad win faster than those who rely on phone calls.
B. How do you hire the first French employee and control cost, overtime and dismissal risk?
Hiring the first employee in France surprises many foreign employers because the written contract is only the visible part. Registration, trial, working time, pay slips and proof rules matter more than the job title.
Every hire starts with the pre-hiring declaration, called declaration prealable a l’embauche or DPAE, filed with URSSAF before the first day. Article R1221-1 of the Labour Code provides: “La déclaration préalable à l’embauche comporte les mentions suivantes”. The declaration must contain the listed details of employer and employee, date and time of hiring, contract type and trial details for open-ended contracts. Without a timely DPAE the employer faces penalties for concealed work, called travail dissimule, and loses credibility in any later dispute. The employee must also be registered for health cover, enrolled with the occupational health service, called service de sante au travail, and, for executives and many staff, with supplementary pension, called retraite complementaire Agirc-Arrco, and provident cover, called prevoyance, under the applicable collective agreement, called convention collective.
The trial period, called periode d’essai, must be written and cannot be presumed. Article L1221-19 of the Labour Code provides: “Le contrat de travail à durée indéterminée peut comporter une période d’essai dont la durée maximale est”. An open-ended contract, called contrat a duree indeterminee or CDI, may include a trial whose maximum length is then set by staff category: two months for workers and employees, three months for supervisors and technicians, four months for executives, renewable once if the collective agreement and the contract allow it. During the trial each party can end the relationship with the short notice periods set by statute or agreement, without dismissal procedure, called procedure de licenciement, and without severance, called indemnite de licenciement. After the trial, ending a CDI requires a real and serious cause, called cause reelle et serieuse, a formal invitation, an interview, called entretien prealable, a notification letter, and minimum severance where the employee has eight months of service. The companion guide on failed trials details the letters and timelines.
Working time is the next shock. The statutory week is thirty-five hours, called duree legale hebdomadaire. Hours beyond that are overtime, called heures supplementaires, paid with uplifts, usually twenty-five percent for the first eight hours and fifty percent beyond, or compensated with time off, called repos compensateur, where an agreement allows it. The employer must control and prove working time with reliable records. Two recent rulings of the Social Chamber shape every dispute.
In Cass. Soc. 2 April 2025, appeal No. 24-11.686, decision No. 360 F-D, available at Cour de cassation, the Court recalled: “la charge de la preuve relative au nombre d’heures effectuées est partagée entre le salarié et l’employeur”. The burden of proof on the number of hours worked is shared between employee and employer. The employee must first present sufficiently precise elements on the unpaid hours claimed, to allow the employer, who controls working time, to respond with its own records. A labour court that simply states that the employee must prove overtime, without examining the employee’s schedule and without checking whether the employer justified the hours actually worked with control tools, violates that rule and its judgment is quashed, called cassation.
In Cass. Soc. 5 March 2025, appeal No. 23-20.522, decision No. 242 F-D, available at Cour de cassation, the Court applied the same test: “en cas de litige relatif à l’existence ou au nombre d’heures de travail accomplies, il appartient au salarié de présenter, à l’appui de sa demande, des éléments suffisamment précis quant aux heures non rémunérées qu’il prétend avoir accomplies afin de permettre à l’employeur, qui assure le contrôle des heures de travail effectuées, d’y répondre utilement en produisant ses propres éléments”. Where the dispute concerns the existence or number of hours worked, the employee must present sufficiently precise elements on the unpaid hours to allow the employer, who monitors hours worked, to usefully respond with its own evidence. For a foreign employer this means time sheets, badge logs, project tools and manager approvals must exist from day one. A startup that pays a flat salary, called forfait, without a valid overtime agreement and without records will pay arrears, paid leave on arrears and potentially damages for concealed overtime.
Pay and social charges complete the cost picture. Gross salary, called salaire brut, bears employer charges, called charges patronales, roughly forty to forty-five percent above gross depending on level and agreement, and employee charges, called charges salariales, withheld on the pay slip, called bulletin de paie. Net pay, called salaire net, is what the employee receives before income tax withholding, called prelevement a la source. URSSAF collects social contributions, the tax office collects withholding. Late DPAE, late pay slips or wrong collective agreement trigger reassessment, called redressement, with penalties, called majorations. The URSSAF audit guide explains how to challenge such assessments from abroad with a reasoned reply, called reponse aux observations, then an appeal to the amicable commission, called commission de recours amiable, and to the judicial court, called tribunal judiciaire.
For directors, distinguish employment from corporate office. A president of SAS or gerant of SARL holds a corporate mandate, called mandat social, not an employment contract, unless a separate genuine employment contract for distinct technical functions exists with a subordination link. Without that contract the director has no unfair dismissal protection, no overtime and no unemployment insurance, called assurance chomage, but pays social contributions under the scheme for managers. A foreign president living abroad must clarify tax residence, social security affiliation and visa status before taking pay. Paying yourself from the French company without that analysis creates the two most common reassessments: URSSAF reclassification of dividends or branch remittances as salary, and tax residence disputes on worldwide pay.
Practical steps from abroad are straightforward if sequenced. Choose the collective agreement by real activity, not by preference. Draft a French-language contract with English translation for information, with trial, working time, place of work, pay, variable targets and intellectual property assignment. File the DPAE before day one. Set up payroll with a French provider. Give the employee the required documents on arrival. Keep time records monthly. Calendar the trial end date with reminder ten days before. If the trial fails, end it in writing within the trial with the correct notice. If a CDI must be dismissed later, do not improvise a mutual separation, called rupture conventionnelle, or a dismissal without the interview and letter. Each shortcut costs more than the procedure it avoided.
Conclusion
For most foreign founders the SAS subsidiary remains the default: flexible statutes, limited liability, French Kbis and bank account, clear IS and VAT status, and a clean exit by share sale. The SARL subsidiary suits close companies that value statutory approval and a simple manager model. The branch suits a short, defined French mission where the head office accepts direct liability and needs no French equity. In every case, registration on the guichet unique creates rights, the Kbis proves them, the deposit certificate, the beneficial owner filing, the VAT number and the DPAE make them usable, and acts signed before registration must expressly be made in the name of or on behalf of the company in formation to be taken over later. Overtime must be tracked from the first week, trial dates must be calendared, and every refusal from a registry, a bank or an administration must be answered in writing with receipts. Built this way from abroad, the French structure invoices, hires and pays tax without exposing the foreign head office beyond what the chosen vehicle intended.