Introduction
A foreign company looking to operate in France can choose between opening a branch (succursale) or incorporating a subsidiary (filiale). Each has distinct legal, fiscal, and operational implications. This guide by Hayot-expertise.fr helps you make the right choice and complete the process correctly.
Branch vs Subsidiary
| Criterion | Branch | Subsidiary (SAS/SARL) |
|---|---|---|
| Legal personality | None | Yes |
| Share capital needed | No | From €1 |
| Parent liability | Direct and unlimited | Limited to investment |
| Profit transfer | Direct (no withholding) | Dividends (possible withholding) |
| Setup cost | Lower | Higher |
| Setup time | 2–3 weeks | 3–5 weeks |
| Credibility | Lower | Higher |
Choose a branch for testing the French market, short-term operations, or tightly integrated group activities.
Choose a subsidiary for long-term presence, limited liability, or when a French legal identity strengthens commercial credibility.
Branch Registration Requirements
Required documents (all foreign documents must be apostilled and certified translated into French):
- ▸Foreign company registry extract (< 3 months old)
- ▸Company bylaws (certified translation)
- ▸Board resolution authorizing the French branch
- ▸Identity document of the permanent representative
- ▸French domiciliation evidence (lease or domiciliation contract)
A permanent representative based in France must be appointed — a key legal requirement.
Timeline and Costs
- ▸Registration time: 2–3 weeks
- ▸Guichet Unique fees: ~€70–100
- ▸Certified translations: €200–800
- ▸Advisory fees: €800–2,500
Tax Obligations
The branch constitutes a permanent establishment (PE) in France and is subject to:
- ▸Corporate tax: 15% on first €100,000 profit, 25% above
- ▸VAT: full French VAT compliance required
- ▸Annual accounts: must be filed at the commercial court (both branch accounts and parent company accounts)
Key advantage: Profit transfers from the branch to the foreign parent are generally not subject to French withholding tax (unlike dividends from a subsidiary), depending on the applicable tax treaty.
FAQ
Can a branch hire employees in France? Yes, subject to full French labor law.
Does a branch need a French bank account? Not legally required, but strongly recommended.
How long to close a branch? 4–8 weeks (simpler than dissolving a subsidiary).
Contact Hayot Expertise
We handle the entire French branch setup for foreign companies: document preparation, apostilles, RCS registration, accounting setup and ongoing fiscal compliance.
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Article written by Hayot Expertise
Chartered Accountant, registered with the Institute of Chartered Accountants.
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