With a rich history and deep-rooted culture, France is well known to many around the world. As the largest country in the European Union (EU), France is one of the most popular destinations for foreign investment in the region. It has a well-developed economy and provides a business-friendly environment, with a legal system that is in line with EU standards. Although many emerging economies show a high potential for growth, France remains 1 of the top nations in the world in terms of GDP and is a leading country in terms of trade.
Starting a Business in France
There are many reasons why a company may want to expand or start a business in France. For one, it has a large consumer market of more than 65 million consumers, which is the 2nd highest in the EU (behind Germany) and the 4th highest in Europe. Aside from a large consumer base, France also has world class infrastructure, a highly productive work force and low set-up costs. With a diverse economy and dynamic services sector, as well as high GDP, it is an ideal place for businesses who are looking to explore the region.
Legal System in France
The legal system in France is a civil law legal system based on legal codes, statutes, and case law. The current system of administrative law is known as the Napoleonic code and was implemented by Napoleon. The Napoleonic code governs all branches of French law, which includes the code civil, code penal and code fiscal.
Public Holidays in France
The following are official, national public holidays in France:
- New Year’s Day
- Labor Day
- Victory in Europe Day
- Ascension Day
- Whit Monday
- Bastille Day
- Feast of Assumption
- All Saint’s Day
- Armistice Day
- Christmas Day
**Note: other public holidays are state or territory specific.
Business Entities in France
There are various business structures available to businesses who wish to start or expand to France, including Société a resonsabilité limitée (SARL), Enterprise individuelle (EI), Société en norm collectif (SNC), Société anonyme (SA) and Société par actions simplifiée (SAS).
- SARL – this is equivalent to a limited liability company in the US.
- EI – this is a sole proprietorship in France. For this kind of entity, no initial capital is required and the sole proprietor is responsible for all debts and obligations.
- SNC – an SNC is a commercial partnership. A minimum of 2 partners are required to form an SNC and there is no minimum capital requirement.
- SA – this is equivalent to a public limited company. There is a minimum of 7 shareholders required and an initial share capital of €37,000.
- SAS – this kind of entity is similar to a limited legal company in in the US. While it is similar to the SA, this offers more flexibility and has less stringent requirements.
Working Hours in France
The working hours for full-time employees is set at 35 hours as per the French Employment Code. In terms of changes to legislation, it is possible for employers to let employees work up to 39 hours a week for an extra cost. The extra pay must be determined through collective bargaining, but it must exceed at least 10% the rate of normal pay.
Employees are not able to waive their rights under statutory provisions by contract. However, in larger companies, senior managers and executives within a company may be exempted from the restrictions of the set working hour limit.
Aside from the exception regarding senior management and executives, there are some limitations according to the law, which apply when calculating working time:
- Every employee is entitled by law to an uninterrupted period of 1 day’s rest per week, which is usually on a Sunday.
- In principle, an employee must have a minimum of 11 hours rest per day, consecutively.
- There is a limit on the number of working hours, which is set at 48 hours per week and in exceptional circumstances 60 hours per week.
- Working hours may not exceed an average of 44 hours per week for a period of 12 consecutive weeks.
Leave in France
Annual leave in France
According to French law, employees are entitled to a minimum of 5 weeks’ paid holiday a year, in addition to public holidays. Additional paid leave may be negotiated through collective bargaining for employees who have reached a certain length of service as well as for family-related events.
Sick leave in France
The French Labor Code provides that employees who are sick or injured are entitled to remuneration (taking the social security payments into account), for up to 90 days, provided that:
- The employee has at least 1 years’ service with the employer.
- The employee is covered by social security.
- A medical certificate is provided within 48 hours.
- The employee has benefits from medical care.
Workers who are injured or sick and provide proof of a medical certificate, may have their work contract suspended until they are fit to resume work activities again. Unless it is necessary to replace the sick employee with another employee, the sick or injured employee cannot be dismissed during this period.
Healthcare in France
The healthcare system in France comprises of an integrated network of both private and public hospitals, as well as several medical service providers. It aims to provide good quality healthcare for all French citizens.
France has maintained a reputation of having a strong public healthcare system. In order to access the benefits of public healthcare in France, expats will need to be registered. Many employers register their foreign employees; however, the onus is on the employee to ensure it is done in the proper manner.
Public hospitals in France are known as hôpitaux and provide access to a range of specialists. For people who utilize public healthcare are only billed a small portion of the cost during their stay at a hospital. Generally, the largest portion of the bill is covered by the state health insurance scheme. The health care system is funded by contributions made by employees, employers, and the central government.
Even though France has a very good quality public healthcare system, private health insurance is also available to those who wish to use such services. Private health insurance generally allows for members to go to cliniques (which are the equivalent to private hospitals).
Expats who are not part of the European Union (EU) and do not contribute toward the French public healthcare system, will be required to take out private healthcare insurance for their stay in France.
INS Global in France
As one of the leading global PEO’s in the world, INS Global has the necessary resources and expertise to ensure your company has a seamless integration into the French marketplace. Our localized associates can ensure the highest quality service whether you are looking to set up a business in France, looking to employ local talent for your business or wish to place your employees in France on an efficient payroll system. Get in touch with us today and allow our consultants to simplify your expansion.