You live in London, New York, Dubai or Singapore. Your French company, a SAS (société par actions simplifiée, the flexible French corporation most foreign founders choose) or a SARL (société à responsabilité limitée, the French limited liability company), needs cash urgently: a supplier must be paid, payroll is due at the end of the month, or a growth opportunity cannot wait for a bank. Your French bank hesitates because your file comes from abroad, and you wonder whether you can simply wire your own money to the company. The answer is yes, but the legal vehicle you choose for that transfer decides everything that follows: how fast the company receives the funds, whether you can recover them on demand, how the interest is taxed, and what happens if the other shareholders or a future dispute stand in your way. French law offers three well-tested routes to a foreign shareholder who funds a French company from abroad: the shareholder current account (compte courant d’associé), a formal capital increase, and intra-group treasury loans between companies linked by capital. Each route has its own paperwork, its own approval procedure, and its own traps. This article explains, for a business reader with no French legal background, how each route works, which French acronyms you will meet along the way (Kbis, greffe, INPI, BODACC, CGI, BOFiP), and how you get your money back while living outside France. Every decisive legal statement below is anchored to the exact French statute or court decision that supports it.

I. How a Foreign Shareholder Can Legally Fund a French Company From Abroad

A. Can a Foreign Founder Lend Money to a French Company Through a Shareholder Current Account

The shareholder current account, known in French as the compte courant d’associé, is the everyday tool by which a shareholder leaves money at the disposal of his or her company. In practice, you wire funds from your personal or foreign holding account to the French company’s bank account, the advance is recorded in the company’s books as a debt owed to you, and the company can use the cash immediately. Foreign founders use this route constantly because it is fast: unlike a capital increase, it requires no amendment of the articles of association (statuts), no filing with the company registry, and no waiting for a new Kbis. The Kbis is the official registration certificate of a French company, issued by the greffe, which is the registry office of the local commercial court (tribunal de commerce); banks, suppliers and administrations ask for a recent Kbis before doing business with you, and every structural change to the company ends with an updated Kbis. A shareholder advance changes nothing in the Kbis, which is precisely why it is the quickest way to meet an urgent need.

French law authorises this practice, but it frames it. The starting point is the banking monopoly: Article L.511-5 of the Monetary and Financial Code provides that “Il est interdit à toute personne autre qu’un établissement de crédit ou une société de financement d’effectuer des opérations de crédit à titre habituel”, which means that only a licensed credit institution may lend as a regular business. A shareholder who occasionally advances funds to his or her own company does not carry on a lending business, so the prohibition does not catch the ordinary compte courant d’associé. Between companies, the statute goes further and expressly shelters treasury operations: Article L.511-7 of the same Code allows a company to carry out treasury operations with companies with which it has, directly or indirectly, “des liens de capital conférant à l’une des entreprises liées un pouvoir de contrôle effectif sur les autres”, that is, capital links giving one of the linked companies effective control over the others. A foreign parent company funding its French subsidiary therefore sits inside an express statutory exception, while an individual shareholder funding his or her own company relies on the occasional, non-professional character of the advance. In both cases, the advance must be documented as a genuine loan, with a written agreement stating the amount, the interest rate if any, and the repayment terms.

Interest is allowed, and it must be put in writing. Article 1905 of the Civil Code states that “Il est permis de stipuler des intérêts pour simple prêt soit d’argent, soit de denrées, ou autres choses mobilières”, so a loan of money may bear interest. Article 1907 of the same Code adds three rules that foreign lenders sometimes discover too late: “L’intérêt est légal ou conventionnel. L’intérêt légal est fixé par la loi. L’intérêt conventionnel peut excéder celui de la loi, toutes les fois que la loi ne le prohibe pas. Le taux de l’intérêt conventionnel doit être fixé par écrit.” In plain terms, you may agree on a contractual rate, even above the statutory rate, but the rate is only enforceable if it is written down. A verbal understanding over a video call, or a bare wire transfer reference reading “shareholder loan”, will not support an interest claim if the relationship sours. The written agreement should also state whether interest capitalises, when it is payable, and what happens if the company repays early.

The direction of the money matters enormously, and this is where foreign directors make the costliest mistake. French law encourages shareholders to lend to the company, but it strictly forbids the reverse flow when the borrower is an individual manager. Article L.223-21 of the Commercial Code, for the SARL, provides that “A peine de nullité du contrat, il est interdit aux gérants ou associés autres que les personnes morales de contracter, sous quelque forme que ce soit, des emprunts auprès de la société, de se faire consentir par elle un découvert, en compte courant ou autrement, ainsi que de faire cautionner ou avaliser par elle leurs engagements envers les tiers.” The contract is void, not merely voidable. Article L.225-43 of the same Code imposes the identical prohibition in companies with a board of directors, covering directors, the chief executive and their family members. Note the decisive qualifier: the ban targets individuals (“autres que les personnes morales”). A foreign parent company that is itself a legal entity may borrow from or lend to the French subsidiary within the treasury exception, while an individual founder who is also gérant (manager) of the SARL or président of the SAS may never use the company as his or her personal overdraft. If you live abroad and run the French company day to day, keep the two directions rigorously separate: your advances to the company are welcome and documented, while any withdrawal beyond dividends regularly voted and paid exposes you to nullity of the transaction and, in a failure context, to personal liability proceedings.

Shareholder advances are also subject to the French procedure for related-party agreements, and the applicable text depends on the vehicle you chose at incorporation. If you hesitated at that stage between the available structures, the firm’s comparison of how a foreign founder chooses between a SAS, a SARL, a branch and a subsidiary remains the reference for that first decision. In a SARL, Article L.223-19 of the Commercial Code requires the manager or the statutory auditor to present “un rapport sur les conventions intervenues directement ou par personnes interposées entre la société et l’un de ses gérants ou associés”, and the shareholders vote on that report, with the blunt safeguard that “Le gérant ou l’associé intéressé ne peut prendre part au vote et ses parts ne sont pas prises en compte pour le calcul du quorum et de la majorité.” In a SAS, Article L.227-10 of the same Code requires the statutory auditor or, where none has been appointed, the president to present to the shareholders “un rapport sur les conventions intervenues directement ou par personne interposée entre la société et son président, l’un de ses dirigeants, l’un de ses actionnaires disposant d’une fraction des droits de vote supérieure à 10 % ou, s’il s’agit d’une société actionnaire, la société la contrôlant au sens de l’article L. 233-3.” Shareholders then vote on the report. An unapproved agreement is not automatically void in a SAS — the statute says such agreements still produce effects, with “à charge pour la personne intéressée et éventuellement pour le président et les autres dirigeants d’en supporter les conséquences dommageables pour la société” — but the interested party bears the damage, so approval remains the only safe path. In a single-member company, the formality is reduced to an entry in the register of decisions, yet it must still be made. Foreign founders sometimes skip this step because they own one hundred percent of the company and see the vote as theatre; auditors, tax inspectors and future buyers do not share that view, and a missing report is the first document a challenger asks for.

B. When Should a Foreign Shareholder Increase Capital or Use an Intra-Group Loan Instead

A shareholder current account is a debt, repayable in principle on demand, and there are moments when debt is the wrong answer. If the French company has lost half of its share capital, if a bank conditions a loan on stronger equity, or if a future fundraising requires a clean balance sheet, the foreign shareholder should consider putting money in as equity rather than as a loan. A cash capital increase (augmentation de capital en numéraire) permanently strengthens the company’s equity: the funds cannot be reclaimed the way a current-account advance can, but they reassure creditors, restore the balance-sheet ratios that French law watches, and avoid the interest-deduction ceilings that cap the tax benefit of shareholder loans. The choice between debt and equity is therefore a business decision with legal consequences in both directions: debt keeps your money recoverable but fragile in a dispute, while equity locks it in but protects the company and your position as shareholder.

The capital-increase procedure is heavier than a simple wire, and foreign shareholders should plan for several weeks. In a SAS, the shareholders meet in an extraordinary meeting (or vote by written consultation if the articles allow it), cancel or maintain the preferential subscription right of existing shareholders, approve the issue price, and record the subscriptions. The new funds must be deposited with a bank or a notary, which issues a deposit certificate (certificat du dépositaire). Since 1 January 2023, all company formalities in France pass through the INPI single window, known as the guichet unique, the online portal run by the INPI (Institut national de la propriété industrielle, the French intellectual-property and business-formalities office); the file is submitted there, checked, then routed to the competent greffe, and the updated Kbis evidences the new capital. The transaction is then announced in the BODACC (Bulletin officiel des annonces civiles et commerciales, the official gazette where company creations, capital changes and insolvency openings are published). Each of these steps leaves a trace, and each trace has a cost in time and publication fees, which is why founders keep the current account for emergencies and reserve capital increases for structural funding. A practical warning for groups: if the French company is held through a foreign holding company, the holding’s own corporate approvals for subscribing to the increase must be collected in advance, translated where the French depository requires it, and checked against exchange-control or foreign-investment reporting duties in the investor’s home country.

Between these two poles sits a third route that multinational groups use constantly: the intra-group treasury loan. Where the lender is not you as an individual but your foreign operating company or holding company, and where that company controls the French subsidiary through capital links, Article L.511-7 of the Monetary and Financial Code expressly permits treasury operations between companies bound by “des liens de capital conférant à l’une des entreprises liées un pouvoir de contrôle effectif sur les autres” This covers upstream loans from the French subsidiary to the foreign parent as well as downstream loans from the parent to the subsidiary, provided the relationship genuinely confers effective control and the terms are arm’s length. The documentation standard is higher than for an individual’s advance: groups are expected to sign a real intra-group loan agreement, set a market interest rate supported by comparables or by the rate the French borrower could have obtained from an independent bank, define covenants and events of default, and record the loan consistently in both companies’ books. Transfer-pricing documentation may also be required when the amounts are significant, because the French tax administration can challenge rates that shift profit artificially across the border. For a founder who owns the French company directly as an individual, this route is unavailable until a holding structure exists; for a founder who already operates through a foreign company, it is often cleaner than a personal advance, because it keeps personal and corporate assets separate and it speaks the language banks and auditors expect.

A short Paris note is useful here, because most foreign founders register their French company in Paris or elsewhere in the Île-de-France region. The procedure is national — the INPI single window, the same Commercial Code, the same tax ceilings — but the practical interlocutors sit locally: the greffe of the Paris commercial court for a company seated in Paris, the Paris tax offices for the corporate filings, and, where the company leases premises, the Paris commercial-lease market with its own rent levels and renewal rules. Nothing in the funding analysis changes because the seat is in Paris, yet files move faster when the shareholder identifies the competent greffe and the competent tax service before wiring funds, rather than discovering afterwards that a filing went to the wrong office. Where premises matter to the project, the firm’s analysis of signing and renewing a Paris office lease from abroad completes this funding picture on the occupancy side.

II. How a Foreign Shareholder Recovers the Money and Defends the Claim From Abroad

A. When Can a Shareholder Living Abroad Demand Repayment of the Current Account

The central question for any lender-shareholder is timing: can you ask for your money back whenever you want, or did your own paperwork postpone that right? French practice starts from a simple default rule, constantly invoked before the courts: shareholder advances are repayable on demand, at any time, unless the parties agreed otherwise. The Court of Appeal of Poitiers restated this starting point in a judgment of 14 January 2025 (RG 24/00832), in a dispute between former business partners over the repayment of two shareholder current accounts in a SAS operating as a property dealer. The claimants argued that they could “bénéficier de plein de droit du principe selon lequel les avances en compte courant sont remboursables à tout moment”, that is, benefit as of right from the principle that current-account advances are repayable at any time. The court’s answer is the passage every foreign shareholder should read before wiring funds: “La cour constate ainsi que selon leur simple lecture littérale, les dispositions statutaires susdites excluent, limitent ou encadrent le droit, par un associé, de voir rembourser à tout moment son compte courant créditeur, en soumettant la demande y afférente à une décision collective des associés.” In that case, Article 12 of the company’s articles required a collective decision of the shareholders, taken in ordinary form, to set the conditions for withdrawal or repayment, and the court held that “L’absence d’une décision collective, exigée par les statuts aux fins de remboursement du compte courant d’associé, constitue ainsi une première contestation sérieuse.” Repayment was refused in interim proceedings, not because the principle of repayment on demand was wrong, but because the shareholders’ own articles had conditioned it. The full reasoning is published at the official record of the Poitiers judgment of 14 January 2025, RG 24/00832. The lesson for a founder living abroad is direct: the default rule favours you, but your articles of association and any blocking agreement (convention de blocage) can delay or condition repayment, and courts enforce what you signed.

Blocking agreements deserve a clear explanation because banks often require them. When a French bank lends to the company, it frequently asks the main shareholder to “block” his or her current account, meaning the shareholder promises not to demand repayment before the bank loan is repaid, or before a fixed date. The promise is usually signed in a separate letter or in the shareholder-loan agreement itself, sometimes coupled with a subordination clause (the shareholder is repaid only after the bank). A blocked account strengthens the company’s equity-like resources in the bank’s eyes, but it temporarily neutralises the very advantage of the current account: immediate availability of your money. Before signing, a foreign shareholder should negotiate four points: the exact duration or the event that releases the block, whether interest continues to accrue during the block, whether partial repayments remain possible, and what happens if the company distributes dividends while the account stays blocked. An unlimited block with no release event is a trap; a block tied to the bank loan’s maturity, with interest running and a clear release letter at the end, is a normal financing tool. Never sign a blocking letter presented at the bank counter without keeping a countersigned copy and without checking that the person signing for the company had authority to accept the corresponding commitment.

If the company, or the co-shareholders who control it, refuse repayment once it is due, the foreign shareholder is not without remedies, and distance does not remove them. The first step is a formal demand letter (mise en demeure) sent by a means that proves receipt, quantifying principal, contractual interest and the date from which interest runs. The demand letter starts the clock on late interest and demonstrates good faith in any later proceedings. If the debt is not seriously disputable — a documented advance, a credit balance in the approved accounts, no valid blocking clause — French procedure offers an emergency route before the president of the commercial court, the juge des référés, who can order interim payment of an undisputed provision while the merits are examined later. The Poitiers case itself travelled that road: the claimants sought provisional payment of 145,295.90 euros and 200,061.69 euros plus statutory interest, and lost only because the articles’ collective-decision requirement created a serious dispute, a “contestation sérieuse”, which is precisely what bars interim relief. Where the file is clean, the same route succeeds every week in French commercial courts. On the merits, the shareholder sues for repayment of the loan, and French courts can, where the debtor company’s situation genuinely requires it, grant staggered payment: Article 1343-5 of the Civil Code provides that “Le juge peut, compte tenu de la situation du débiteur et en considération des besoins du créancier, reporter ou échelonner, dans la limite de deux années, le paiement des sommes dues.” A shareholder who sues from abroad should therefore expect that a court may spread repayment over up to two years rather than ordering immediate payment in a single sum, and should factor that horizon into settlement talks. Proceedings can be conducted through a French lawyer with a power of attorney, hearings attended by video where the court allows it, and enforcement pursued against the company’s French assets, so relocation abroad never means abandoning the claim.

B. How Is the Interest Taxed and What Paperwork Keeps the Tax Administration Away

Interest paid on a shareholder advance is not a free supplement to the loan; it is income for the lender and, within limits, a deductible charge for the company, and both sides of that equation are policed. For the French company, Article 39 of the General Tax Code (CGI, Code général des impôts, the French tax code) opens with the principle that “Le bénéfice net est établi sous déduction de toutes charges”, so interest is in principle deductible like any business expense. The same article then caps the deduction for interest paid on shareholder advances by reference to a maximum rate published quarterly by the tax administration, a ceiling practitioners call the taux maximal d’intérêts déductibles. The administration’s doctrine database, the BOFiP (Bulletin officiel des finances publiques, the official online commentary where the tax administration publishes its interpretation of tax law), gives the calculation method and the rate for each quarter. Interest above the ceiling is not lost morally, but it is added back to taxable profit: the company pays corporate income tax on it as if the excess had never been an expense. For loans between related companies, Article 212 of the General Tax Code adds a second filter, stating that “Les intérêts afférents aux sommes laissées ou mises à disposition d’une entreprise par une entreprise qui est son associée ou par une entreprise liée, directement ou indirectement, au sens du 12 de l’article 39, sont déductibles” only within the limits it sets, by reference either to the Article 39 rate or to the rate the borrowing company could have obtained from independent banks in comparable conditions. A foreign parent that funds its French subsidiary at an inflated rate, or at a symbolic zero rate that later looks like a disguised subsidy, invites a reassessment on both fronts: non-deductible excess on the French side and transfer-pricing adjustment on the spread. The safe method is to set the rate at or below the published ceiling, to keep the bank-comparable evidence in the file, and to apply the same rate consistently in both companies’ books.

For the lender, interest received is taxable income, and residence abroad adds a withholding layer that must be checked before the first payment. Article 120 of the General Tax Code classifies the relevant investment income as revenue for French tax purposes, opening with “Sont considérés comme revenus au sens du présent article”, and interest paid by a French company to a lender who lives outside France may suffer French withholding tax at source, subject to reduction or elimination under the double-tax treaty between France and the lender’s country of residence. Treaty relief is never automatic: it typically requires the lender to certify foreign residence on the appropriate form before payment, so that the French paying company applies the reduced treaty rate, or to claim a refund afterwards with proof of residence and beneficial ownership. A foreign founder who receives interest on a French current account without any withholding analysis may discover the issue years later during an audit, with late-payment interest added. The file should therefore contain, from the first interest payment, the lender’s certificate of tax residence, the treaty article relied upon, and the calculation of any withholding actually levied and declared. Where the lender is a foreign company rather than an individual, the same discipline applies, with the additional question of whether the interest is effectively connected to a French permanent establishment, a point on which the treaty and the facts of local activity decide.

Keeping the file clean from abroad is largely a matter of routine, and routines survive distance when they are written down. Every advance should generate four documents: the signed loan or current-account agreement with the written rate, the bank proof of the incoming wire identifying the lender, the board or shareholder approval covering the related-party procedure, and the bookkeeping entry in the company’s accounts showing the credit balance in your name. At year-end, the statutory auditor, where one exists, reviews these balances for the report on related-party agreements, and the approved annual accounts disclose the position. Shareholders based abroad usually assemble this file before any transfer, keep countersigned copies of every blocking or subordination letter, and diary the dates: the release date of any block, the interest-payment dates, and the limitation horizon for any claim. The line used for foreign-company files of this kind is +33 6 46 60 58 22. The URSSAF (Unions de recouvrement des cotisations de sécurité sociale et d’allocations familiales, the French social-security collection agency) has no direct role in shareholder loans, but founders sometimes confuse a current-account repayment with salary or dividends, and that confusion is expensive: salary triggers payroll charges and dividend distributions require regularly voted profits, while a current-account repayment returns your own loan and follows none of those circuits. Labelling each transfer correctly in the wire reference and in the books prevents a repayment from being recharacterised later as disguised remuneration.

Conclusion

A foreign shareholder who funds a French company from abroad chooses, in practice, between speed and solidity. The shareholder current account is the fastest route: a documented advance, a written interest rate, approval under the related-party procedure, and the money is available without touching the articles, the greffe or the Kbis. The capital increase is the solid route: slower, filed through the INPI single window and published in the BODACC, but permanent and reassuring to banks. The intra-group treasury loan is the group route, expressly sheltered by the Monetary and Financial Code where capital links confer effective control, provided the rate is arm’s length and the documentation would survive a transfer-pricing review. Recovery follows the paperwork: advances are repayable on demand unless the articles or a blocking agreement say otherwise, courts enforce the block the parties signed, and a judge who orders payment may still stagger it over up to two years. Interest must be written to exist, deductible only within the statutory ceiling, and taxable in the lender’s hands with treaty relief to be secured before payment, not after an audit. None of this requires living in France; all of it requires writing things down before the wire leaves your account.