How to Set Up a Subsidiary in France in 2026: Legal Forms, Documents, FDI Screening & Director Rules

Last updated: 1 June 2026, reflects the Economic Simplification Act (loi de simplification de la vie économique, or SVE) and 2025–2026 FDI screening guideline updates.

Understanding how to set up a subsidiary in France is the critical first step for any foreign company planning to enter the French market with a locally incorporated entity. France remains one of Europe’s largest economies and a magnet for cross-border investment, yet the regulatory landscape shifted meaningfully in 2025 and 2026 with the adoption of the SVE and the French Treasury’s updated foreign direct investment guidelines. These changes streamline certain administrative filings while simultaneously tightening FDI scrutiny across an expanded list of sensitive sectors.

This guide walks B2B decision-makers, in-house counsel, CFOs and international expansion leads, through entity selection, required documents, the FDI notification process, director appointment rules and a realistic formation timeline so that every compliance requirement is addressed before the subsidiary begins trading.

Quick Overview, Should You Incorporate a Subsidiary in France?

A subsidiary is a separate French legal entity owned, in whole or in part, by a foreign parent company. Unlike a branch (succursale), a subsidiary has its own legal personality, its own assets and liabilities, and its own tax registration. That structural independence means the parent’s liability is generally limited to its capital contribution, making a subsidiary the preferred vehicle for companies that want to ring-fence risk, enter into contracts in the subsidiary’s own name, and build long-term market presence.

The SVE, adopted in 2026, introduces targeted administrative simplifications for company formation, including expedited digital registration workflows and rationalised filing obligations, that the likely practical effect will be to shorten lead times for standard incorporations. At the same time, foreign investors must be mindful of the parallel tightening of FDI screening, which can extend timelines significantly if the subsidiary’s activities fall within designated sensitive sectors. Before choosing a structure, it is advisable to map the subsidiary’s planned activities against the current FDI sensitive-sectors list published by the Direction Générale du Trésor.

Subsidiary vs Branch in France, Quick Comparison

The choice between a subsidiary and a branch is one of the first strategic decisions a foreign parent must make. The table below summarises the key legal, liability and tax differences that inform this decision.

Practical Implications for Contracts and Accounting

A subsidiary can sign contracts, own intellectual property, hire employees and open bank accounts in its own name. A branch cannot, every obligation reverts to the parent. For industries where local counterparties (distributors, public-sector clients, regulated entities) require contracting with a French-registered company, a subsidiary is the only viable option. Additionally, audit and accounting standards for subsidiaries follow French commercial code requirements, meaning annual accounts must be approved and filed at the greffe du tribunal de commerce. Industry observers expect most foreign groups to favour subsidiaries over branches for substantive operations, given both the liability shield and the contractual credibility a separate legal entity provides.

Choosing the Legal Form: SARL, SAS, SA and Branches

France offers several corporate forms for a subsidiary. The three most commonly used by foreign parents are the société à responsabilité limitée (SARL), the société par actions simplifiée (SAS) and the société anonyme (SA). Each structure has different governance, capital and audit requirements that influence the parent’s flexibility and ongoing compliance burden.

SARL, the LLC-Style Entity

The SARL is a limited-liability company governed by relatively rigid statutory rules. It is suitable for smaller operations or single-shareholder subsidiaries (EURL). Management is vested in one or more gérants who must be natural persons. The SARL’s governance framework is less flexible than the SAS, making it less popular for complex group structures but straightforward for simpler operations.

SAS, the Flexible Capital Structure

The SAS is now the most commonly chosen form for foreign-owned subsidiaries in France. Its principal advantage is contractual freedom: the articles of association (statuts) can allocate governance powers, voting rights and transfer restrictions with very few mandatory constraints. A single président, who may be a legal entity rather than a natural person, is the only required officer. This flexibility makes the SAS ideal for venture-backed subsidiaries, joint ventures and multi-layered group holdings.

SA, the Public-Company Form

The SA is designed for larger enterprises and is mandatory for companies seeking a listing on Euronext Paris. It requires a board of directors (conseil d’administration) or a supervisory board with a management board, a statutory auditor, and a significantly higher minimum share capital. It is rarely the first choice for a foreign subsidiary unless the business plan involves public offerings or regulated financial activities.

The SVE has rationalised certain filing obligations that previously applied differently depending on entity form. Early indications suggest that the harmonised digital registration workflow now available via the guichet unique reduces form-specific administrative friction, although the substantive governance distinctions remain unchanged. For a deeper look at what corporate services entail and how they support businesses, see our dedicated guide.

Step-by-Step: How to Set Up a Subsidiary in France, Practical Checklist

The formation process can be divided into three phases: pre-incorporation, incorporation, and post-incorporation. Below is the sequence a foreign parent typically follows when opening a subsidiary in France.

Phase 1, Pre-Incorporation

• Parent board resolution. The foreign parent passes a formal resolution authorising the creation of a French subsidiary, designating the proposed legal form, share capital amount, initial directors and registered office address.
• Gather and legalise parent company documents. Certificate of incorporation, articles of association and a certificate of good standing of the parent must be apostilled (Hague Convention countries) or consularly legalised, then translated into French by a traducteur assermenté.
• Open a blocked bank account and deposit share capital. A French bank (or a Caisse des Dépôts) will issue a certificat de dépôt des fonds confirming the capital deposit. Funds remain blocked until the company is registered.

Phase 2, Incorporation

• Draft and sign the statuts. The articles of association must comply with the French Commercial Code and be signed by all founders or their authorised representatives.
• Publish a legal notice. A notice of incorporation must be published in a journal d’annonces légales (JAL) in the département of the registered office. The JAL issues a publication certificate required for the registration file.
• File the registration application. Since the migration to the guichet unique portal (managed by INPI), all incorporation filings are submitted electronically. The greffe du tribunal de commerce processes the application, assigns a registration number and issues the extrait Kbis, the official proof that the subsidiary exists as a French legal entity.

Phase 3, Post-Incorporation

• Obtain SIRET / SIREN numbers. INSEE automatically assigns these identification numbers once the greffe processes the registration. The SIRET is essential for invoicing, hiring and contracting.
• Register for VAT (TVA). The subsidiary applies to the Service des Impôts des Entreprises (SIE) for an intra-community VAT number.
• Register with URSSAF for payroll. If the subsidiary will employ staff, it must register with URSSAF for social security contributions. Further details on employer obligations are available from URSSAF’s official portal.
• Release blocked capital. Once the Kbis is issued, the bank releases the deposited share capital into the subsidiary’s operating account.

For additional context on how international commercial law principles interact with local French requirements, consult our practice-area guide.

Required Documents to Open a Subsidiary in France, Detailed Checklist

The documents to open a subsidiary in France fall into two categories: those relating to the foreign parent company and those relating to the proposed directors and officers. All non-French documents must be apostilled or consularly legalised and accompanied by a certified French translation.

Parent Company Documents

• Certificate of incorporation (or equivalent registration document) of the parent, apostilled and translated.
• Articles of association / bylaws of the parent, apostilled and translated.
• Board resolution authorising the creation of the subsidiary, appointment of directors and capital contribution, certified and translated.
• Certificate of good standing (or equivalent), dated within three months of filing, apostilled and translated.
• Power of attorney (if a representative will sign statuts on behalf of the parent), notarised, apostilled and translated.

Director and Officer Documents

• Valid passport or national identity card of each proposed director / président.
• Declaration of non-conviction (déclaration sur l’honneur de non-condamnation), signed by each officer.
• Proof of domicile of each director (utility bill or equivalent, dated within three months).

Incorporation-Specific Documents

• Signed statuts of the subsidiary.
• Bank certificate of capital deposit (certificat de dépôt des fonds).
• Proof of registered office address, commercial lease, domiciliation agreement or property title.
• Publication certificate from the journal d’annonces légales.
• Completed online registration form via the guichet unique (INPI portal).

Information on required filings and form templates is maintained by the greffe via Infogreffe and by the French government’s Service-Public portal.

Foreign Direct Investment Screening, When and How It Applies to Subsidiaries in France (2026)

Foreign direct investment screening in France is governed by Articles L. 151-3 and R. 151-1 et seq. of the French Monetary and Financial Code and administered by the Direction Générale du Trésor (French Treasury). The regime requires non-EU and, in certain cases, EU investors to seek prior authorisation before acquiring control of, or significant influence over, a French entity operating in designated sensitive sectors. The French Treasury published updated guidance in July 2025 that expanded the list of sensitive activities and clarified procedural timelines, a move that industry observers expect to increase the number of notifiable transactions in 2026.

Key Triggers for FDI Notification

• Acquisition of control. Any transaction by a non-EU investor that results in control (direct or indirect) of a French entity engaged in a sensitive activity requires prior authorisation.
• Crossing the voting-rights threshold. A non-EU investor crossing 25 % of the voting rights in a French entity in a sensitive sector must notify the Treasury. For listed companies, a lower threshold applies.
• Acquisition of all or part of a branch of activity. Acquiring a business line (not just shares) in a sensitive sector is also caught.
• Intra-EU investments. EU/EEA investors are subject to a narrower list of sensitive activities (primarily defence, dual-use and certain security-related sectors) but are not exempt from the regime entirely.

Notification Process, Timelines and Remedies

The investor files a formal notification with the Treasury, which has 30 business days to respond (Phase 1). If the Treasury opens a detailed review (Phase 2), an additional 45 business days apply. During this period, the transaction cannot close. The Treasury may clear the investment unconditionally, impose conditions (commitments on employment, R&D location, supply continuity or governance safeguards), or, in rare cases, prohibit the transaction. Voluntary pre-notification is strongly recommended for borderline cases, as it can significantly reduce formal review timelines.

For a more comprehensive walkthrough of the FDI compliance process, including enforcement trends and practical examples, see our guide on what is the FDI process in France. Additional authoritative analysis is published by the CMS Expert Guide on FDI screening and White & Case’s Foreign Direct Investment Reviews.

Directors, Officers and Governance, Rules and Practicalities

One of the most common misconceptions about appointing a director for a France subsidiary is that French law requires at least one resident director. In fact, there is no blanket French-resident director requirement for an SAS or SARL. A non-resident can serve as président of an SAS or gérant of a SARL without needing to relocate to France. The SA, by contrast, has historically required a minimum proportion of board members to be EU-resident, although reforms have relaxed these constraints.

Nominee Directors, Risks and Best Practice

While appointing a local nominee director is legally permissible, it introduces governance and liability risks. A nominee who acts as dirigeant de droit bears personal liability for management decisions, including tax and social-security debts in the event of insolvency. Best practice is to ensure that the nominee’s mandate, scope of authority and reporting obligations are documented in a separate management agreement aligned with the statuts. Relying on a nominee purely for convenience, without clear governance guardrails, exposes both the parent and the individual to regulatory scrutiny.

Social Security and Visa Considerations

If a director is operationally active in France (signing contracts, managing employees, making day-to-day decisions on French soil), that person may be deemed a travailleur subject to French social-security contributions and, if non-EU, may need a work visa or carte de séjour. For guidance on France’s immigration and visa requirements, including language compliance obligations, see our article on France immigration 2026 language requirements. Those exploring longer-term residency options may also wish to find out if they are eligible for French citizenship by descent.

Registered Office, Accounting, Tax Registration and Ongoing Obligations

Every French subsidiary must maintain a registered office address in France (siège social). Options include a commercial lease, a co-working domiciliation agreement or a virtual-office service, provided the domiciliation company is registered and compliant with French anti-money-laundering regulations. The registered office determines the subsidiary’s jurisdiction for court proceedings and tax administration.

Once operational, the subsidiary must comply with the following ongoing obligations:

• Annual accounts. Prepare and file annual financial statements at the greffe within six months of the financial year-end (extendable by one month on application).
• Corporate tax. File annual corporate-tax returns with the SIE; the standard corporate income tax rate is 25 %.
• VAT returns. File monthly or quarterly VAT returns depending on turnover thresholds.
• Payroll declarations. Submit monthly Déclaration Sociale Nominative (DSN) via the URSSAF portal for all employed staff.
• Beneficial-ownership declaration. File a declaration of beneficial owners (déclaration des bénéficiaires effectifs) at the greffe at incorporation and update upon any change.

Practical Timeline and Estimated Costs (2026)

For a standard, non-FDI-sensitive subsidiary, the realistic end-to-end timeline from parent board resolution to a fully operational entity is approximately three to six weeks. FDI-screened transactions can add 30 to 75 business days for Treasury review. Indicative cost bands are as follows:

• Notary and legal fees (statuts, filings): EUR 2,000–5,000 depending on complexity.
• Greffe registration fees: approximately EUR 70–250.
• Legal notice publication: EUR 150–250.
• Certified translations and apostilles: EUR 500–1,500 depending on volume.
• Domiciliation / registered office (annual): EUR 500–3,000 depending on location and service level.
• Bank account opening and capital deposit: typically no separate fee, but account maintenance charges apply.

For FDI-sensitive sectors, add legal advisory costs for the notification dossier, which can range from EUR 10,000 to EUR 50,000 or more depending on transaction complexity and sector sensitivity.

Key Risks and Mitigation Checklist

• FDI non-compliance. Closing a transaction without required Treasury authorisation can result in nullification, fines and forced divestment. Mitigation: conduct a sector-mapping exercise and pre-notify voluntarily if there is any doubt.
• Employment law exposure. Hiring employees triggers mandatory adherence to French labour law, including collective bargaining agreements. Mitigation: identify the applicable convention collective before issuing the first employment contract.
• IP transfer pricing. Transferring intellectual property into the subsidiary must comply with French transfer-pricing rules and arm’s-length standards. Mitigation: prepare a transfer-pricing policy and intercompany licensing agreement before go-live.
• Beneficial-ownership gaps. Failure to file or update the beneficial-ownership declaration is a criminal offence. Mitigation: build beneficial-ownership filings into the post-incorporation compliance calendar.
• Director liability without governance framework. Nominee or non-resident directors remain personally liable under French law. Mitigation: document delegation-of-authority agreements and maintain D&O insurance cover.

Conclusion, Next Steps for Setting Up a Subsidiary in France

Knowing how to set up a subsidiary in France, from selecting the right legal form and gathering apostilled documents to navigating FDI screening and appointing directors, is the foundation of a successful market entry. The regulatory landscape in 2026, shaped by the SVE and updated Treasury guidance, rewards companies that plan their compliance pathway before filing a single form. For tailored guidance on structuring and incorporating a French subsidiary, explore the Global Law Experts lawyer directory to connect with qualified international business practitioners.

Sources

1. French Treasury (Direction Générale du Trésor), FDI Guidance
2. Business France, Setting Up a Business in France
3. CMS Expert Guide, FDI Screening in France
4. White & Case, Foreign Direct Investment Reviews 2026: France
5. ICLG, Foreign Direct Investment Regimes: France
6. Infogreffe, Company Registration and Kbis
7. Service-Public.fr, French Government Services Portal
8. URSSAF, Social Security and Payroll Registration