Fiscal representative or agent: when a foreign company must appoint one

Quick answer. A foreign company carrying out operations subject to VAT in France, without being established there, must register for French VAT. If it is established outside the European Union and in a country without a tax-collection assistance agreement with France, it must appoint an accredited fiscal representative (Article 289 A of the tax code), jointly and severally liable for the VAT. If it is established in the Union, or in a third country having concluded an assistance agreement (including the UK), it registers directly and may, if it wishes, appoint a fiscal agent — a mere intermediary for the formalities, without joint liability.

Cross-border e-commerce, digital services, sales of goods with stock in France: many foreign companies carry out operations subject to French VAT without having an establishment there. They must then register for VAT and, depending on their country of establishment, appoint a representative or a fiscal agent. The distinction between the two is essential, as it carries very different liability consequences. It is a topic adjacent to keeping the accounts of a foreign company in France, but distinct.

As soon as a company not established in France carries out operations subject to VAT there (sale of goods located in France, certain services, imports followed by local sales, stock in France) or has reporting obligations there, it must obtain a French VAT number and file returns. The question of the representative or agent then arises depending on its place of establishment.

A company established outside the European Union, in a country that has not concluded a tax-collection assistance agreement with France, must appoint an accredited fiscal representative (Article 289 A of the tax code).

• Its role. The representative carries out the VAT reporting and payment formalities on behalf of the foreign company.
• Its liability. Crucial point: the fiscal representative is jointly and severally liable for the VAT owed by the company it represents. That is why it is accredited by the administration and commits its own financial liability.
• Its purpose. This joint liability is the guarantee the administration requires when the company is established in a country with which it cannot cooperate to collect the tax.

A company established in the European Union, or in a third country having concluded an assistance agreement with France, does not have to appoint a fiscal representative: it registers directly for French VAT. It may, if it wishes, appoint a fiscal agent.

• Its role. The agent carries out the reporting formalities in the name and on behalf of the foreign company.
• Its liability. Unlike the representative, the agent acts under the exclusive liability of the foreign company, which remains solely liable for the VAT. The agent is not jointly liable.
• Its purpose. It relieves the company of the formalities, without committing its own financial liability.

In addition to EU Member States, companies established in third countries that have concluded a mutual collection assistance agreement with France are exempt from a fiscal representative. This list, set by order, notably includes Argentina, Australia, Azerbaijan, Georgia, India, Iceland, Mexico, Moldova, Norway, South Korea, Saint-Barthélemy and the United Kingdom. For these countries, registration is done directly, and an agent suffices. This is notably the case for British companies after Brexit, as we discuss regarding selling to the UK.

The British company after Brexit. The UK is among the countries with an assistance agreement with France: a British company registers directly for French VAT, without a fiscal representative, and may use an agent.

The online seller with stock in France. Holding stock in France for local sales makes the operations subject to French VAT and triggers the registration obligation, with a representative or agent depending on the country.

The confusion with permanent establishment. Registering for VAT in France does not mean having a permanent establishment for corporate-tax purposes: these are two distinct notions, to be analysed separately, as for the choice between subsidiary and branch.

• The country of establishment decides. Outside the EU without an agreement = representative mandatory; EU or "agreement" country = direct registration and optional agent.
• Liability differs entirely. The representative is jointly liable; the agent is not.
• Check the list of "agreement" countries. It is set by order and evolves: the UK is part of it since Brexit.
• Don't confuse VAT and permanent establishment. VAT registration does not, on its own, create a permanent establishment.
• Anticipate the invoice mention. The French VAT number and the right mention condition the regularity of the operations.

Recently, a company established in a third country asked us about its obligations for sales of goods stocked in France. It thought a simple administrative provider would suffice. The analysis showed that, its country having no collection assistance agreement with France, it had to appoint an accredited fiscal representative, jointly liable for the VAT — not a mere agent. We clarified the framework, identified the right vehicle and secured the registration, avoiding the risk of a regularisation and penalties.

Our conviction, as accountants registered with the Ordre, is that the representative / agent distinction is often misunderstood, although it is decisive. Appointing an agent when a representative is required exposes the company to an irregular registration; conversely, imposing a representative on an EU company is pointless. The first step is always to identify the country of establishment and the existence of an assistance agreement, alongside tax advice and reporting management.

Hayot Expertise advice. If your foreign company carries out operations subject to VAT in France, start with your country of establishment. Established in the Union or in a country with an assistance agreement with France (including the UK)? Direct registration, optional agent. Established in a third country without an agreement? Accredited fiscal representative mandatory, jointly liable. Check the list of countries, don't confuse VAT registration and permanent establishment, and get support: a poorly framed registration is paid for in regularisations.