Meta description: Foreign company without an establishment in France: how to work in France without creating a permanent establishment, what fiscal and social obligations, when to register with the RCS, and what risks for SME managers?

Foreign company without establishment in France: the complete guide for SME managers

A foreign company without an establishment in France can perfectly work with French customers, employ employees in France or use teleworking, but under certain conditions.

For an SME manager, the border between simple “remote” activity and a permanent establishment in France is strategic: it conditions taxation, social obligations, registration and the level of risk.

I. Can you work in France with a foreign company without an establishment?

1. Can a foreign company work in France?

A foreign company can work in France without having a subsidiary or branch as long as it does not have a permanent establishment there within the meaning of tax law and international conventions.

In practice, this aims in particular at:

• the sale of goods or services to French customers from abroad,
• short-term one-off missions,
• interventions carried out mainly remotely, with no structure or organized commercial presence in France.

The challenge is not to cross the threshold of activity carried out in the usual manner via a fixed business establishment or a dependent agent, which would characterize a permanent establishment.

2. Key concept: permanent establishment under French tax law

The core of the reasoning is the concept of permanent establishment: a fixed establishment of business through which the company carries out all or part of its activity, or the presence of a dependent agent who has the power to engage the company in the usual manner.

Typically constituting a permanent establishment in France:

• an office, a branch, a workshop, a long-term construction site;
• an employee or representative with the authority to negotiate and sign contracts on behalf of the foreign company;
• in a more nuanced way, a remote employee who acts as a usual sales representative for France.

In the presence of a permanent establishment, profits made in France become taxable for corporate tax in France and the company must comply with the corresponding reporting obligations.

II. Foreign company without establishment in France: in which cases?

1. Activities that can be carried out without a permanent establishment

For example, a foreign company with no establishment in France can:

• operate a foreign e-commerce site that delivers to French customers, without stock or personnel in France;
• provide consulting services from abroad for French clients, without offices or recurring appointments in France;
• intervene on an ad hoc basis at fairs or events, without a permanent structure.

In these cases, the company remains taxable in its State of residence, subject to certain indirect taxes in France (such as VAT).

2. Teleworking in France for a foreign company: attention to the risk of permanent establishment

Teleworking in France for a foreign company is an increasingly frequent practical case.

The main risk is twofold:

• in social security: employees working physically in France are in principle subject to the French regime (URSSAF, pension, etc.), except for limited and supervised secondment;
• in taxation: the employee's activity can be classified as a permanent establishment if the employee has a central commercial role or signing authority.

Concrete example: a salesperson based in France, an employee of an American company, who approaches French customers, negotiates contracts and signs them on behalf of the company. There is a serious risk that the French administration will consider that the company has a permanent establishment in France, with the obligation to pay tax on the corresponding profits there.

III. What are the tax obligations of foreign companies in France?

1. Tax obligations of foreign companies in France without a permanent establishment

A foreign company without a permanent establishment in France is in principle not subject to corporate tax in France on its profits, but it may be liable to:

• VAT on transactions located in France, according to the rules of territoriality (B2C services, B2B sales with reverse charge, etc.);
• withholding taxes on certain income (royalties, interests, commissions in some cases);
• any local or sectoral taxes depending on the activity.

It is therefore crucial to analyze, for each business model, the flows generated in France and the applicable territoriality rules.

2. Tax obligations of foreign companies in France with a permanent establishment

In the presence of a permanent establishment in France, the foreign company must:

• identify yourself with the French tax authorities,
• keep accounts specific to the activities of the permanent establishment,
• declare and pay corporate tax on profits attributable to this establishment,
• comply with obligations in terms of VAT, withholding taxes and, where applicable, territorial economic contribution.

International tax treaties avoid double taxation, often through tax exemptions or credits in the country of residence.

IV. Foreign company and SIRET: registration and registers

1. Do foreign companies have a SIRET?

Foreign companies can obtain a SIREN/SIRET number in France in several situations:

• establishment of a permanent establishment (branch, office, etc.) and registration in the National Business Register and, as appropriate, in the RCS;
• creation of a liaison office or a structure without direct commercial activity but requiring an identifier to interact with the administrations;
• specific registration as a foreign company without a permanent establishment in France when required by law (in particular in the presence of employees affiliated to the French regime or social or fiscal obligations).

Thus, even without a subsidiary or branch, a foreign company can be granted a SIRET to facilitate local declarations and obligations.

2. Foreign company not registered with the RCS: case of the liaison office

For example, a foreign company not registered with the RCS may have a liaison office in France:

• he does not carry out commercial acts on his own account,
• it is limited to information, prospecting or representation functions,
• he does not conclude contracts or invoice from France.

In this case:

• RCS registration is not required,
• an entry in the national register of businesses and establishments can be made, giving a SIREN/SIRET for administrative purposes.

However, be careful: if the liaison office starts to have a real commercial activity, it risks being reclassified as a permanent establishment, with all the associated fiscal and social consequences.

3. Foreign company registered with the RCS: branch and legal form

When a foreign commercial company creates a branch in France, it must in principle be registered with the RCS, indicating in particular:

• its original legal form (Ltd, GmbH, SA, SARL, etc.),
• the address of the establishment,
• the identity of the legal representative in France.

The branch does not have a separate legal personality, but it allows:

• to have a visible commercial foothold,
• to have a SIRET,
• to comply with French accounting, fiscal and social obligations for local activity.

V. Registration of a foreign company with no establishment in France

1. How to register a foreign company in France?

The procedure depends on the nature of the presence in France:

• with a permanent establishment (branch): registration with the RNE and the RCS via the one-stop shop for formalities;
• without a permanent establishment, but with social or fiscal obligations (for example, employees subject to the French social security system): specific registration as a foreign company without a permanent establishment in France on the one-stop shop, making it possible to identify the foreign seat;
• liaison office: declaration of existence for registration in the directory, obtaining a SIREN/SIRET without its own commercial activity.

Recent regulations have strengthened the control of registrations of foreign companies without a permanent establishment in France to combat social fraud and ensure the conformity of the information provided.

2. Registration of a foreign company without establishment in France: obligations and risks

A foreign company that employs employees affiliated to the French regime or that has certain tax obligations must complete the formality of registering a foreign headquarters in France, even without a permanent establishment.

In case of absence or false declaration:

• criminal sanctions are possible (fine, prison sentence for false information),
• the company is exposed to adjustments in social security contributions and taxes,
• requalifications as a permanent establishment may be made with retroactive effect.

It is therefore essential to secure the qualification of a presence in France before choosing the registration route.

VI. Working for a foreign company in France: employee and teleworking

1. Working for a foreign company in France: what are the implications?

An employee residing in France can perfectly work for a foreign company:

• or by being formally employed by the foreign company,
• or via a referral system, employer of reference or other intermediary structure.

But this pattern raises several questions:

• membership in French social security (URSSAF, pension, pension);
• income taxation in France as long as the employee works there;
• risk of being classified as a permanent establishment if the employee usually represents the foreign company.

2. Teleworking in France for a foreign company: points of vigilance

International teleworking is particularly sensitive:

• on the social level, the foreign employer often has to register with French social organizations to declare remuneration and pay contributions;
• From a fiscal point of view, the French administration may consider that a teleworker constitutes a fixed place of business if his activity is continuous and usual, thus creating a permanent establishment.

Example: a British SME with no structure in France allows a commercial executive to set up in Lyon using complete remote working. He manages the French market, negotiates contracts and has signing authority. There is a serious risk that France will consider that a permanent establishment has been created, with an obligation for the SME to pay corporate tax on profits related to France.

VII. Practical framework: how can a foreign company structure its presence in France?

Option — Main characteristics — Benefits — Risks/limitations

• Foreign company without establishment in France: no fixed structure in France, activity carried out from abroad, possibly with some employees subject to French regimes. Advantages: flexibility, taxation mainly in the State of residence, limited formalities if there is no permanent establishment. Risks: requalification into a permanent establishment if local activity becomes usual and structured.
• Liaison office: information and representation structure, without commercial acts in France. Advantages: limited local presence, SIRET possible, image control. Limits: strictly supervised activities, risk of requalification if commercial transactions are carried out.
• Branch (permanent establishment): permanent establishment registered with the RCS, own accounting, SIRET. Advantages: commercial visibility, clear fiscal and social framework. Limits: subject to corporate tax in France, full accounting and reporting obligations.
• French subsidiary: company under French law (SARL, SAS, etc.), own legal personality. Advantages: better acceptance by partners, legal compartmentalization. Limits: costs and obligations of any French company, group complexity.

VIII. FAQ — Foreign company with no establishment in France

1. Can a foreign company work in France?

Yes, a foreign company can work in France without having a subsidiary or branch, provided it does not have a permanent establishment (fixed business establishment or dependent agent) on French territory.

However, it must respect the rules of VAT, withholding taxes and, where applicable, certain social obligations when it employs employees in France.

2. What are the tax obligations of foreign companies in France?

The tax obligations of foreign companies in France depend on the existence or not of a permanent establishment:

• without a permanent establishment: possible VAT liability, withholding taxes on certain income, limited reporting obligations;
• with permanent establishment: subject to corporate tax on profits made in France, VAT, possible local taxes and full accounting obligations.

3. Do foreign companies have a SIRET?

Foreign businesses can get a SIRET when they:

• create a branch or other registered permanent establishment,
• declare a liaison office,
• or meet an obligation to register as a foreign company without a permanent establishment in France (for example for employees affiliated to the French regime).

Therefore, not all foreign companies automatically have a SIRET, but many obtain one as soon as they reach a certain level of presence in France.

4. How can I register a foreign company in France?

To register a foreign company in France, you must go through the one-stop shop for formalities and choose the right scheme:

• branch or permanent establishment: registration with the RNE and the RCS,
• foreign company without a permanent establishment with social obligations: specific formality for registering a foreign head office,
• liaison office: statement allowing registration in the directory.

The choice depends on your economic model, the nature of activities in France and the level of physical or human presence.

5. Registration of a foreign company without an establishment in France: is it mandatory?

Yes, in some cases, the registration of a foreign company without a permanent establishment in France is mandatory, in particular when it:

• employs employees affiliated to the French social security system,
• or supports certain local tax obligations.

The objective is to identify the company in the French files and to allow the collection of contributions and taxes.

6. Foreign company not registered with the RCS: is it possible?

Yes, it is possible when:

• the company does not have a permanent establishment in France,
• and that its activity is limited, for example, to a liaison office (without commercial acts) or to purely cross-border transactions.

However, it can be registered in the business register and obtain a SIREN/SIRET without being registered with the RCS.

7. Working for a foreign company in France: what are the risks?

Working for a foreign company from France involves:

• for the employee, taxation of his income in France and, most often, membership in French social security;
• for the employer, a risk of requalification into a permanent establishment if the employee's activity is structuring for the French market (prospecting, signing contracts, commercial management).

In the event of poor expectations, the company may be subject to significant fiscal and social adjustments.

8. List of foreign companies in France: is there a public register?

Foreign companies registered in France (branches, subsidiaries, certain establishments) are visible via public databases (RNE, RCS, etc.).

However, there is no simple exhaustive list of foreign companies operating without a permanent establishment, especially when their presence is limited to customer relationships from abroad.

9. Foreign company registered with the RCS: what are the consequences?

A foreign company registered with the RCS via a branch:

• must file certain documents (articles of association, accounts, etc.),
• has a SIRET,
• is subject to fiscal and social obligations corresponding to the activity carried out in France.

This solution provides visibility and legal security, but involves costs and formalism that match the commitment in France.

10. Foreign commercial company registered with the RCS: legal form to indicate?

When registering a foreign commercial company with the RCS, it is necessary to indicate its original legal form (Ltd, GmbH, Inc., SA, etc.), as recognized in its State of establishment.

This information makes it possible to assess the liability, governance and representation regime applicable to the French branch.

11. Teleworking in France for a foreign company: what precautions?

For teleworking in France for a foreign company, the key precautions are:

• securing the employee's social situation (registration with URSSAF, pension organizations, mutual insurance, etc.);
• analyze the risk of creating a permanent establishment (nature of functions, signing authority, usual nature of the activity);
• check the applicable tax treaty to avoid double taxation

A prior audit makes it possible to adjust the employment contract, the powers of the employee and, where appropriate, the establishment structure.

IX. A regulated subject: why need support?

The presence of a foreign company without an establishment in France, the analysis of the permanent establishment, the registration of the RNE or the RCS, URSSAF and fiscal obligations as well as international teleworking schemes constitute a highly regulated and constantly evolving matter.

The consequences of a poor qualification (lack of registration, non-payment of contributions, undeclared permanent establishment) can be serious: adjustments, penalties, or even criminal sanctions. It is therefore strongly recommended that you be accompanied by a lawyer in business law and international taxation to anticipate risks, choose the right structure (without an establishment, liaison office, branch or subsidiary) and secure your contracts as well as your operational practices.

Article written by Guillaume Leclerc, business law lawyer in Paris, Champs-Elysées.

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