You live in London, New York, Singapore or Dubai and France is your next market. You need to invoice French clients, open a French business bank account, hire a first employee in Paris or Lyon, and sign contracts that French counterparties trust. The first question your French lawyer will ask sounds simple and decides everything that follows: through which legal vehicle will you operate, a SAS, the société par actions simplifiée, the flexible French joint-stock company run by a president, a SARL, the société à responsabilité limitée, the close-knit limited liability company run by a gérant, a branch, the succursale, the direct extension of your foreign company with no legal personality of its own, or a subsidiary, the filiale, a fully French company owned by your foreign parent? Get this choice wrong and you pay for years: a foreign parent held directly liable for French debts, a director affiliated to the wrong social security regime and overcharged by URSSAF, the social security collection body that chases unpaid contributions with formal notices, a bank that refuses the account because the file does not match the vehicle, or an exit that costs twice what a better structure would have cost. This guide walks the four vehicles in order. First, the SAS against the SARL, the two French companies a foreign founder normally shortlists, who runs each one, who signs for it, who can be removed and what the director costs in social charges. Second, the branch against the subsidiary, when the foreign parent stays directly on the hook, when France taxes the profits at the standard corporate rate, and how each vehicle hires, bills with VAT and closes down. Every acronym is explained, every decisive rule is quoted from the official text, and every step is written for an owner who acts from abroad.

I. Should a foreign founder pick a SAS or a SARL: freedom of the articles against protection of the statute

A. SAS or SARL for a foreign owner: who runs the company, who signs for it, and who can be removed without warning

Both the SAS and the SARL shield their owners the same way at the starting line. A SAS, provides that “Une société par actions simplifiée peut être instituée par une ou plusieurs personnes qui ne supportent les pertes qu’à concurrence de leur apport”, meaning it can be formed by one or more persons whose losses stop at their contributions, as Article L227-1 of the Commercial Code states. A SARL mirrors the promise: “La société à responsabilité limitée est instituée par une ou plusieurs personnes qui ne supportent les pertes qu’à concurrence de leurs apports”, as Article L223-1 of the Commercial Code provides. Formed with a single shareholder, each becomes its one-member version, the SASU, the société par actions simplifiée unipersonnelle, or the EURL, the entreprise unipersonnelle à responsabilité limitée, and the sole shareholder exercises the powers of the collective meeting alone. Limited liability, however, is where the resemblance ends, and for a foreign founder the differences that matter sit in three places: who manages, who binds the company against third parties, and who can be dismissed on what terms.

The SAS runs on contractual freedom. Its articles of association, the statuts, the private constitution of the company that the shareholders draft and file, decide almost everything, because “Les statuts fixent les conditions dans lesquelles la société est dirigée”, the articles set the conditions under which the company is managed, as Article L227-5 of the Commercial Code provides in a single sentence that carries the whole SAS philosophy. The shareholders invent the governance they need: a lone president, a president plus one or more general managers, a board, committees, veto rights for the foreign parent, reserved matters, casting votes. The SARL runs on statute instead. It “est gérée par une ou plusieurs personnes physiques”, it is managed by one or more natural persons, as Article L223-18 of the Commercial Code states, and those gérants are appointed by the shareholders, need not be shareholders themselves, and exercise powers framed by the code rather than invented by the contract. A foreign group that wants bespoke control, investor seats, differentiated shares and a chairman-style president usually feels at home in a SAS. A family business or a two-partner venture that wants a tested, rigid, court-proof frame usually sleeps better in a SARL.

Facing outsiders, the SAS speaks through one voice. “La société est représentée à l’égard des tiers par un président désigné dans les conditions prévues par les statuts. 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”, meaning the company is represented against third parties by a president appointed as the articles provide, and the president holds the widest powers to act in all circumstances in the name of the company within the limit of the corporate purpose, as Article L227-6 of the Commercial Code provides. In dealings with third parties the company remains bound even by presidential acts beyond the corporate purpose unless it proves the third party knew or could not have been unaware of the excess, so banks, landlords and suppliers can rely on the president signature with rare exceptions. The SARL gérant holds broad powers too, but the code polices internal limits more visibly and the shareholders meeting keeps a stronger statutory role. For a foreign owner signing from abroad through a local president, the SAS rule is a commercial asset, counterparties trust the signature, and a personal risk, a president who exceeds internal caps can still bind the company, so the caps must be drafted, published where possible and backed by real reporting, not left as gentlemen agreements in emails.

The sharpest trap for foreign owners sits in dismissal clauses, and two recent published rulings of the Cour de cassation, the supreme court for civil and commercial matters, settled the point in language every SAS founder should memorise. On 9 July 2025 the Commercial Chamber quashed a Paris appeal ruling that had let a unanimous shareholder vote override the articles on dismissal terms, holding that “les statuts de la société par actions simplifiée fixent les conditions dans lesquelles celle-ci est dirigée, notamment les modalités de révocation de ses dirigeants. Si une décision des associés peut compléter les statuts sur ce point, elle ne peut y déroger, quand bien même aurait-elle été prise à l’unanimité”, meaning the articles set how the SAS is managed, including how its officers are removed, a shareholder vote may complete the articles but can never contradict them, even unanimously, as Cass. com., 9 July 2025, No. 24-10.428, published in the Bulletin, ECLI:FR:CCASS:2025:CO00389 holds. The same solution had already been stated on 12 October 2022 for a general manager: “les statuts de la société par actions simplifiée fixent les conditions dans lesquelles la société est dirigée, notamment les modalités de révocation de son directeur général. Si les actes extra-statutaires peuvent compléter ces statuts, ils ne peuvent y déroger”, as Cass. com., 12 October 2022, No. 21-15.382, published in the Bulletin holds. In practice a foreign parent that appoints a Paris president by board minute with golden-parachute wording, while the filed articles say dismissal is free and immediate, owns a worthless minute. The articles win every time, so dismissal terms, notice, severance and just-cause requirements belong inside the statuts themselves, amended and re-filed before the dispute, never in side letters.

One SAS boundary never moves, whatever the articles say. Certain decisions must stay collective, because “Les statuts déterminent les décisions qui doivent être prises collectivement par les associés dans les formes et conditions qu’ils prévoient”, the articles decide which decisions shareholders take collectively and in what form, while capital increases, mergers, divisions, dissolution, transformation, appointment of auditors, approval of annual accounts and distribution of profits stay reserved to collective shareholder action, as Article L227-9 of the Commercial Code provides. A foreign sole shareholder cannot quietly approve accounts or vote dividends through a presidential decision alone, the collective minute must exist, signed and kept with the company registers, because the greffe, the registry office of the commercial court that keeps the RCS, the Registre du commerce et des sociétés, the Trade and Companies Register, the tax office and any future buyer will ask for it. The SARL is stricter still, with statutory majorities for amending the articles and transferring shares to outsiders, which protects a minority local partner but slows a foreign group that wants instant reorganisation. Our pillar guide to setting up a company in France as a foreign founder, bank account, Kbis, VAT and first hire maps the full formation chain, capital deposit certificate, registered office proof, filing at the Guichet unique, the single online gateway run by the INPI, the Institut national de la propriété industrielle, the French intellectual property and companies gateway, and delivery of the Kbis, the official identity card of a French company issued by the greffe, and this article builds on it for the vehicle choice itself.

B. SAS president or SARL gérant: what a foreign director really costs in social charges and what the bank demands before opening the account

The second fault line is the director personal status, and it hits the wallet every month. The paid president of a SAS belongs to the general salaried scheme as an assimilated employee, because the code lists “Les présidents et dirigeants des sociétés par actions simplifiées et des sociétés d’exercice libéral par actions simplifiées” among the persons compulsorily covered, as Article L311-3 of the Social Security Code provides. Concretely the SAS president pays roughly employee-style contributions on salary, gains health, pension and workplace-accident cover close to a true executive, and costs the company employer charges, while building no unemployment rights unless a genuine employment contract alongside the office survives URSSAF scrutiny, which it rarely does for a majority owner-manager. The majority gérant of a SARL belongs instead to the self-employed scheme, the travailleur non salarié, with lower headline contribution rates, no paid-leave or unemployment cover, and a pension arithmetic of its own, while a minority or non-shareholder gérant rejoins the assimilated-employee scheme. Foreign founders who compare a 4,000-euro net monthly target across vehicles without modelling the regime gap regularly misprice the hire by fifteen to twenty thousand euros a year, and URSSAF, the body that collects social contributions and issues the mise en demeure, the formal demand to pay, before the contrainte, the enforceable order, shows no mercy to owners who guessed. Our guide to French social charges for foreign directors, SAS president against SARL gérant works the numbers step by step, and our guide to answering a URSSAF formal demand and contesting enforcement from abroad explains the reply chain when contributions are already disputed.

The bank account is the third fault line, and foreign founders discover it the week they need to deposit the capital. French banks must verify the beneficial owners, the source of funds and the director identity before releasing the capital-deposit certificate, the attestation that unlocks registration, and files signed from abroad with a foreign passport, a foreign proof of address and articles in translation stall more often than local files. Our guide to the French right to an account when a bank refuses a foreign-owned company explains the Banque de France designation procedure, and our guide to the blocked capital-deposit certificate walks the unblocking sequence document by document. Two practical rules decide the outcome whatever the vehicle. First, match the signer to the vehicle from day one: the SAS president named in the articles or in a filed appointment act, or the SARL gérant named in the articles or the appointment minute, appears at the bank with the draft statuts, the ID, the registered-office lease or domiciliation contract and the shareholder list, because a mismatch between the person at the counter and the person in the filed papers freezes the file for weeks. Second, never start trading before the Kbis arrives. Commercial companies “jouissent de la personnalité morale à dater de leur immatriculation au registre du commerce et des sociétés”, they acquire legal personality only upon registration in the Trade and Companies Register, as Article L210-6 of the Commercial Code provides, so contracts signed beforehand bind the signers personally unless the newborn company formally takes them over after registration. A branch escapes this specific wait, as the next part shows, but it pays for the shortcut with the parent own liability.

II. Branch or subsidiary in France: when the foreign parent stays liable and when France taxes the profits

A. Succursale or filiale: a separate French person or the direct arm of the foreign company

Once the SAS-SARL choice is understood, the foreign group faces the upstream question: enter France with a company of its own, or stretch the existing foreign company onto French soil. A subsidiary, the filiale, is a French SAS or SARL whose shares belong to the foreign parent. It registers at the RCS, receives its own Kbis, owns its assets, hires its staff and answers for its debts on its own patrimony, while the parent risks in principle only the capital it invested, plus the well-known exceptions, wrongful trading support, de facto management and group cash-pooling abuses, that French courts use to climb back up to a parent that emptied or steered its child. A branch, the succursale, is the opposite bet. The Ministry of the Economy describes it plainly: it manages business distinct from the head office through its own premises and organisation, yet it has no legal autonomy, no legal personality of its own, and no separate patrimony, capital or assets apart from the parent company, it is run by a legal representative, most often with employee status, and it works as an agency attached to the head office without particular formalism in decision-making, as the official Bercy guide to setting up a foreign business in France explains. The French administration adds that installing a branch, although treated as a foreign investment, is dispensed from prior declaration and authorisation before the Treasury, and that as a permanent structure the branch still falls under the French tax regime, with double taxation avoided where a bilateral treaty exists. For the procedure itself, the Paris commercial court registry runs a dedicated desk for branches whose head office sits abroad, the the Paris greffe branch-registration desk, and filings now travel through the Guichet unique. The consequence a foreign board must internalise is blunt: every French lease, loan, employment contract and tax bill signed by the branch binds the foreign company itself, on all of its worldwide assets, with no corporate veil between Paris and the head office. Creditors need no veil-piercing theory against a branch, there is no veil to pierce.

Three decision factors sort serious candidates. First, exposure. A group testing the French market with one salesperson and a coworking desk, or performing a short contract, may accept branch exposure for speed. A group signing a nine-year commercial lease, borrowing from a French bank, hiring ten engineers or handling consumer risk should interpose a subsidiary, because the day the Paris operation owes six months of rent, back VAT and severance at once, the parent of a branch pays everything directly while the parent of a subsidiary negotiates from behind its shareholding. Second, credibility. French counterparties, landlords and banks read a Kbis for a SAS or SARL with share capital stated on it, while a branch extract shows a foreign head office and a local representative, which sophisticated buyers discount and some tenders exclude. Our guide to commercial-lease renewal and eviction for foreign companies shows how lease disputes punish thinly structured tenants. Third, governance cost. A branch decides fast, the head office instructs its representative and there is no shareholder meeting, no dividend vote, no French board pack. A subsidiary pays the yearly discipline of French company life, accounts approved collectively within six months of year-end, filings at the greffe, announcements in the BODACC, the Bulletin officiel des annonces civiles et commerciales, the official bulletin where company life events are published, and the full French company legal calendar of approvals, filings and payments. Groups that cannot staff that discipline from abroad, with an accountant, a registered-office address that forwards mail and a lawyer who diaries the dates, should either build that team first or accept branch simplicity with open eyes about liability. A halfway house exists, the liaison office, the bureau de liaison, which may only prospect and represent, never bill or sign, and which suits market research but collapses the moment the representative starts closing deals, at which point the tax office recharacterises the office as a permanent establishment and bills accordingly.

B. Corporate tax, VAT and exit: the 25 percent rate, the French VAT number, and closing a branch against dissolving a subsidiary

Tax does not follow the marketing brochure, it follows registration and activity. French companies are in principle liable for corporate tax, the IS, the impôt sur les sociétés, the French tax on company profits, because the code provides that “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”, companies of those forms are liable for corporate tax whatever their purpose, as Article 206 of the General Tax Code states, with the SAS taxed under the same corporate-tax treatment by reference to the joint-stock regime and small single-member structures able to elect transiently for partnership treatment under conditions the tax office checks strictly. The standard rate is now single and memorable: “Le taux normal de l’impôt est fixé à 25 %”, the standard rate of the tax is set at 25 percent, as Article 219 of the General Tax Code provides. A branch pays French corporate tax on the profits attributable to its French permanent establishment just as a subsidiary pays on its own profits, so the branch brings no rate advantage, only the absence of a dividend layer, since branch remittances to the head office are not dividends voted by a French meeting but internal transfers, treated under treaties and theParent-Subsidiary and branch-remittance rules that the group tax adviser must map before the first euro moves. Our guide to French corporate tax for foreign owners, IS at 25 percent, branch against subsidiary, and paying on time details the instalments, and our guide to the missed corporate-tax instalment, the acompte d’IS explains the penalty when a foreign owner forgets a quarterly date.

VAT follows the same territorial logic and punishes latecomers harder than income tax. A subsidiary that sells goods or services in France charges French VAT, files the CA3 periodic return and reclaims input VAT through its French VAT number, while a foreign company that was already billing French clients without that number must regularise old invoices, pay the VAT due and negotiate penalties, exactly as our guide to billing French clients without a French VAT number and our guide to French VAT-number registration from abroad explain step by step. Since 1 September 2026 the electronic-invoicing and transmission duties add a second layer, mapped in our guide to French e-invoicing and e-reporting for foreign companies, and every invoice must carry the mandatory mentions whose absence now draws fines, as our guide to mandatory invoice mentions, fines and late-payment interest details. The branch changes nothing here: it registers for VAT, files and pays like a subsidiary, and the head office that hoped a branch would keep it outside French VAT discovers the opposite, a visible French establishment is the easiest possible audit target. Impots.gouv.fr, the French tax administration portal, publishes the returns calendar and the online filing channels the foreign accountant uses, and the INPI Guichet unique centralises the company filings that keep the VAT file consistent with the RCS record, because a company whose Kbis address, whose VAT registration address and whose actual office disagree invites both the greffe and the tax office to knock.

Exit costs close the comparison and often reverse the entry instinct. Closing a branch means deregistering the French establishment, settling French tax, paying the French staff and creditors directly as the parent, and publishing the withdrawal, which is administrative but exposes the parent to every remaining euro. Dissolving and liquidating a subsidiary means a shareholder vote, a liquidator, creditor ranking, tax clearance and striking the Kbis, the longer dissolution-liquidation-Kbis-removal sequence from abroad, but the parent liability normally stops at the capital and the guarantees it actually signed. Buying instead of building changes the calculus again: acquiring the shares of an existing SAS imports its contracts, its staff and its hidden liabilities in one move, which is why our guide to buying SAS shares from abroad, transfer approval and hidden debts insists on warranties, and taking profits out mixes account approval, dividend votes and withholding tax, as our guide to taking profits out of a French company from abroad explains. Foreign founders should therefore choose the vehicle by exit as much as by entry: if the French venture may fail fast, the subsidiary contains the failure, and if the venture must impress French banks and landlords from day one, the capitalised subsidiary impresses more than the branch extract.

Conclusion

A foreign founder does not choose between four equivalent doors. The SAS offers tailor-made governance at the price of drafting discipline, because the articles decide everything and no side agreement can contradict them, as the 2022 and 2025 published rulings confirm. The SARL offers statutory protection at the price of rigidity, with a gérant framed by the code and shareholders guarded by mandatory majorities. The subsidiary offers a French shield at the price of yearly discipline, accounts, meetings, filings and publications kept current from abroad. The branch offers speed at the price of direct parental liability, with no veil between the Paris lease and the head office balance sheet. Around these four poles the monthly economics decide as much as the law: the assimilated-employee cost of a paid SAS president against the self-employed arithmetic of a majority SARL gérant, the 25 percent corporate rate applied to French profits in every vehicle, the French VAT number without which no serious billing survives, and the exit bill that a subsidiary contains and a branch transmits. Decide in this order: liability first, governance second, director cost third, tax and VAT fourth, exit fifth. Put the dismissal and control clauses inside the articles before the first appointment, align the bank signer with the filed papers, diary the six-month approval and filing chain from year one, and keep the Kbis, VAT and office addresses identical everywhere. Built that way from abroad, a French vehicle stops being a risk register and becomes what it should be, a selling, hiring and invoicing machine that French counterparties trust.

Need a quick opinion on your case

Choosing between a SAS, a SARL, a branch and a subsidiary turns on your articles, your control clauses, your director status and the line between testing the market and committing to it. Our firm offers a telephone consultation within 48 hours with a lawyer of the firm to review your project and set the vehicle, the governance and the filing calendar before you sign, hire or bill. Call +33 6 46 60 58 22 or write through our contact page with your draft articles or term sheet, your planned headcount and your first French contracts attached. We assist foreign founders in Paris and across Île-de-France as well as throughout France.