CAN A FOREIGNER CREATE A BUSINESS IN FRANCE?

Many people doubt whether a foreigner in allowed to create a business in France. As a person of foreign nationality (non-European national) wishing to exercise a commercial, industrial, artisanal activity or another self-employed profession in France, you must have a temporary residence permit (also called a residence permit) authorizing the exercise of an activity. Before setting up a business in France, you must take steps to obtain a visa. Once in the territory, you must apply for a residence permit:

• You can request a temporary residence permit mention Entrepreneur/liberal profession
• You can request a multi-year residence permit mention Talent passport: Entrepreneur

Option n°1: the entrepreneur / liberal residence permit

More specifically, it is a temporary residence permit bearing the words “entrepreneur / liberal profession”. Its validity period is 12 months, renewable under conditions. You can create a business in France in such a capacity.

You must contact the French consulate in your country of origin and apply for long-stay visa equivalent to a residence permit (VLS-TS) marked “Entrepreneur / Liberal profession”. It is advisable to start your procedures at the earliest 3 months before your date of arrival on French territory. Be careful, your mandatory formalities do not stop there! Once in France, you will have to validate your VLS-TS on the dedicated platform of the Ministry of the Interior, within 3 months of your arrival in France.

This residence permit is specifically dedicated to foreign nationals who wish to create their own business (commercial, artisanal or liberal) in France.

You are concerned if you do not have a residence permit giving right to the creation of a self-employed business or in the case of a student or employee residence permit.

What are the eligibility criteria?

To obtain it, you must meet the following criteria:

• Your project is real, serious, and economically viable. A business plan you may be asked.
• You must prove sufficient means of existence with resources corresponding at least to the minimum wage.
• Your activity is compatible with safety, health and public peace.
• You must not have been convicted or banned from practicing.

When and how to apply?

You must contact the French consulate in your country of origin and apply forlong-stay visa equivalent to a residence permit (VLS-TS) marked “Entrepreneur / Liberal profession”. It is advisable to start your procedures at the earliest 3 months before your date of arrival on French territory. Be careful, your mandatory formalities do not stop there! Once in France, you will have to validate your VLS-TS on the dedicated platform of the Ministry of the Interior, within 3 months of your arrival in France.

Option n°2: the “Business Creator” talent passport

This residence permit is open to foreigners graduates and / or qualified. It only concerns you if you plan to create a commercial, craft or industrial activity. Liberal activities are therefore excluded. This is an effective path to create a business in France.

What are the eligibility criteria?

To apply, you must meet the following 4 conditions:

• You have a diploma at least equivalent to a master or 5 years comparable professional experience
• You justify a project real and serious of business creation.You must have obtained a certificate recognizing this on demarches-simplifiees.fr
• You can justify having invested at least30 000 € in your business project (personal resources or loan)
• You have sufficient financial resources : these must be at least equivalent to the minimum wage. 

When and how to apply?

You have tos end your request to the French Consulate in your country of residence.

• If approved and if your stay is less than 12 months, the consulate will issue you avisa long-stay valid as a residence permit (VLS/TS) bearing the mention “talent passport”. Once you arrive in France, you then have 3 months to validate your VLS-TS. Your request therefore takes place in 2 stages!
• If approved and if the duration of your stay is equal to or greater than one year, the consulate will issue you avisa long-term stay bearing the mention “talent passport” for a period of 3 months. When you arrive in France, you will then need to apply for a longer residence permit. The Prefecture of your place of residence will process your application and determine the validity period of your talent passport.

The different legal statuses of your business

EURL, SARL, SA… People wishing to set up their own business are quickly faced with a crucial choice: which legal form to choose? The responsibilities, the share capital or the tax regime relating to it differ greatly from one status to another. Here is an overview of the main different possible legal statuses.

The different legal statuses for your company

• Sole proprietorship (IE)
• Sole proprietorship with limited liability (EURL)
• Limited liability company (SARL)
• Simplified joint-stock company (SAS) or single-member simplified joint-stock company (SASU)

Sole Proprietorship (IE): a flexible shape without minimal input

Sole proprietorship is the form chosen by the vast majority of business creators. The sole proprietorship is a flexible legal form. The the micro-enterprise scheme belongs to this category.

• Partner(s): The individual entrepreneur only (natural person)
• Liability of the partner or partners: The sole proprietorships created since May 15, 2022 benefit from a liability limited to goods useful for their professional activity.
• The sole proprietorships created before May 15, 2022 also benefit from this limited liability for allreceivables incurred as of May 15, 2022.
• Leaders) : The individual entrepreneur, who has full powers
• Responsibility of the director(s) : Civil and criminal liability
• Capital social : None
• Social regime: Scheme for self-employed workers
• Taxation of profits: Income tax (industrial and commercial profits, non-commercial profits or agricultural profits).

Sole proprietorship with limited liability (EURL): a status for sole partner

It is a limited liability company (SARL) with only one partner. These two legal forms therefore share many characteristics.

• Partner(s): Only one (natural or legal person)
• Liability of the partner or partners: Limited to its contributions, except for mismanagement if the partner is also the manager of the company
• Leaders): One or more managers (natural persons), of which the partner may (or may not) be a member
• Responsibility of the director(s): Civil and criminal liability
• Capital social : Free, depending on the size and needs of the company
• Social regime: If the manager is also the sole shareholder, he is considered as a non-salaried worker. Otherwise, the manager is deemed to be an employee
• Taxation of profits: Income tax of the sole shareholder if it is a natural person (with the possibility of choosing corporate tax). If the partner is a legal person, corporation tax.

Limited liability company (SARL):
create a company with a flexible minimum contribution

The limited liability company (SARL) includes at least two partners. This legal form is the most common for companies. On the other hand, it cannot be chosen for the legal, judicial or health professions (excluding pharmacists).

• Partner(s): From two to 100 (natural or legal persons)
• Liability of the partner or partners: Limited to their contribution, except for mismanagement if the partners are also managers of the company
• Leaders): One or more managers (natural persons), who may or may not be partners
• Responsibility of the director(s) : Civil and criminal liability
• Capital social : Free, depending on the size and needs of the company
• Social regime: A majority manager is considered as a self-employed worker, an egalitarian or minority manager is assimilated as an employee.
• Taxation of profits : Corporation tax, with the possibility of opting for income tax in certain cases (“family” LLCs or certain LLCs less than five years old).

Simplified joint-stock company (SAS) or single-person simplified joint-stock company (SASU):
flexible status and liability limited to contributions

This type of company allows great flexibility in terms of capital and the transmission of shares. On the other hand, SAS or SASU cannot be chosen for the legal, judicial or health professions.

• Partner(s): At least one partner (natural or legal person). When it has only one partner, it is a one-person simplified joint-stock company (SASU)
• Liability of the partner or partners: Limited to their contribution
• Leaders) : A president (natural or legal person), but with the obligation of a legal representative (who can be the president). The rules of organization of the company are set freely in the articles of association
• Responsibility of the director(s) : Civil and criminal liability
• Capital social : Free, depending on the size and needs of the company
• Social regime : The president of an SAS is assimilated as an employee
• Taxation of profits : Corporation tax, possibility of choosing income tax in certain cases.

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