What is a liaison office ?
A liaison office, also known as a representative office, is best described as a business entity (whith no legal structure). It’s quick to setup, less expensive, and allows the parent company to better understand the French market and test if the business would have a future in France. In effect, the liaison office allows a company to contact partners or potential clients, to gather information or even to establish lines of communication.
A liaison office is a preliminary status before the creation of a stable entity.
NB: It is not possible to carry out commercial activity with this company status whether in France or abroad. It will therefore be impossible to sign any contract on behalf of a parent company.
Here is a video explaining in greater detail the process of setting up a liaison office – just one of the entity creation services that we offer here at Maupard.
The characteristics / the advantages of a liaison office :
- It is not a legal entity but an extension of the parent company in France.
- It does not need to be registered with the Trade and Companies Register (RCS) in France. Its registration can be carried out in a few days by declaring its existence to the URSSAF of the Bas-Rhin.
- There is no need to open a bank account to create a liaison office.
- There are no share capital requirements for opening.
Moreover, it is not subject to:
- Corporate tax in France as it does not make any sales or provide services directly to the parent company’s customers;
- VAT as it works exclusively on behalf of its head office abroad and does not make any sales, its activities are therefore not subject to French VAT;
- Territorial economic contribution;
- Keeping of accounts.
One must note however, that the liaison office must pay :
- Social security contributions according to the salary paid to the employee;
- Payroll tax
- Ongoing professional training.
The liaison office is the ideal solution for checking whether the French market is in line with your objectives. It does not need to be registered with the Trade and Companies Registry, which considerably reduces the time spent on opening this entity.
Often, foreign companies use it to conduct research activities and test the feasibility of their projects in France.
The Maupard team would be happy to assist and advise you in this project!