DOING BUSINESS IN FRANCE & TRADE OF FRANCE WITH

WORLDPresented By Group 8Pawan JangidShivam GautamShrema GargVishal SharmaAtul PandeyVivek Kapoor

Content

• France : Profile• Foreign Trade• Foreign Trade Statistics• Doing Business Report• Global Ranking• Procedure of Starting Business• Favorable Environment • Corporate Taxes• Labour Laws• Government Support• Conclusion

France : Profile•Name : France•Capital : Paris•Official Language : French•Population : 62 Million(2008)•Literacy rate : 99 %•Currency : Euro•Main Manufacturing Industry : steel, chemicals, textiles, perfumes, aircraft, machinery, electronics•GDP : 2.83 trillion US $(2008)•GDP Per Capita : 32700 US $(2008)

France : Foreign Trade

• Export driven Economy• Rank in World Trade(2008)

– Export• Merchandise : 6• Commercial Services : 4

– Imports• Merchandise : 5• Commercial Services : 6

• GDP to Trade Ratio : 55% (2008)

Foreign Trade Statistics

• Merchandise Trade(2008)– Exports : 605403 Million US $ (FOB)– Share in Worlds Total Exports : 3.77 %– Export Countries

– Imports : 705577 Million US $ (CIF)– Share in World Imports : 4.3 %– Import Countries

EU (27 Countries)

63.6%

US 5.9%

Switzerland 3.0%

EU(27 Countries)

60.3 %

China 6.6 %

US 5.5 %

Foreign Trade Statistics

• Commercial Service Trade(2008)– Exports : 160464 Million US $– Share in World Exports : 4.25 %– Percentage change over 2007 : 9 %– Imports : 139359 Million US $– Share in World Imports : 3.99 %– Percentage change over 2007 : 11 %

Doing Business in France

Why France ?

• Worlds 5 largest Economy.• Economy Driven By Foreign Trade.• Highly Skilled Workforce.• Business Friendly Environment.• Access to European Market.• Highly Developed Infrastructure.• Lowest Setup Cost of Business

New France

PLAY VIDEO 1

Doing Business Report

• France Ranking in Doing Business ReportCriteria 2010 2009

Ease of Doing Business 31 31

Starting a Business 22 14

Dealing with Construction 17 16

Employing Workers 155 153

Registering Property 159 170

Getting Credit 41 43

Paying Taxes 59 55

Trading Across Border 25 22

Enforcing Contract 6 8

Closing Business 42 42

Procedures For Starting New Business

1. Check name for uniqueness with the Institute National de la Propriété Industrielle (INPI)

2. Deposit the initial capital3. Publish a notice of incorporation of the

company 4. File a request for a company’s registration

with the Centre de Formalités des Entreprises (CFE)

5. Buy company books (minute books, inventory books, ledgers). Have company books stamped and initialed by the clerk of the commercial court

Procedure of Starting Business

• 5 Procedures, 7 Days.• 0.9 % of Per Capita Income

Favorable Environment

• Second Largest in FDI inflow in world.• In 2008 117.5 Billion US $ FDI.• Highest FDI Inflow in Europe is in

France(2008).• Currently Around 23000 Foreign companies

working in France.• Highly Productive Workforce.• Ranked 3 in Productivity Per Hour.• France is ranked 3rd in Europe for the

percentage of young people (25-to-34-year-olds) holding a degree in tertiary education.

Corporate Taxes

• Taxable business income is calculated by deducting eligible expenses from revenue.

• Deductible expenses are those related to the company’s business.

• Excluding temporary additional taxes, the following tax rates are applied– Standard rate of 33.33%.– Small businesses pay 15% on the first € 38,120 and

the standard rate on remaining profits.– An additional social-security levy of 3.3% is applied

to companies where income taxable at the standard rate exceeds € 2,289,000.

• Losses can be carry Forwarded and Carry backed.

Corporate Taxes

• Value Added Tax at 19.6 % uniformly.• Vat for Food & Certain Agri. Product is 5.5 %.• Medicines 5.5 % or 2.1 %.• Property Taxes Companies are subject to

property tax on the rental value of land and buildings.

• Local Taxes are Calculated on the Base of Land & Building which is half of 8 % of Base Value.

• Local Taxes Rates Decided by Local Authorities.

Tax Incentives In France

• There are no duties when registering newly formed companies.

• Tax exemption on Dividend received from Subsidiaries.

• Exemption on Capital Gains generated by Equity Share Transfers.

• Acquisition cost and Interest payments can be Deducted.

Labour Laws

• Freely Negotiated Labour Contract.• Simple hiring procedures that may

also be completed online.• Layoffs on personal or economic

grounds.• 35-hour week: greater flexibility since

2003.• Retirement at 60.• Staggering paid leave of five weeks.• The social security system.

Government Support

• For setting up in Economically Backward Areas– By Government & Regional Authorities.– Subsidies, Tax Exemptions, Tax Credit.– for the period from 2007 to 2013, the limit on

assistance ranges from 10 to 15% of the investment for large business and from 20 to 35% for SMEs.

– In High Unemployment Areas Tax Exemption of Corporate Taxes can be granted for 7 Years.

Government Support

• Outside the Economically Backward Area For Small Size Business 15 %, Medium size 7.5% subsidy.

• For Research firms Govt. provide Research Tax Credit(first year 50%, Second year 40%, Third Year onwards 30%)

• Subsidies may cover a portion of R&D expenditure

• Up to 30% Expenditure can be covered by Govt. for meeting the EU Environment norms.

Why Corporate Have Chosen?

PLAY VIDEO 2

Conclusion

• France is the logical choice, with its location at the heart of the EU.

• Second Highest in FDI inflow.• 23,000 foreign companies already in France.• Qualified and highly productive labor force,

unparalleled infrastructure, and low business setup, real estate and electricity costs.

• No. 1 in Nuclear Energy Production.

References

• en.wikipedia.org/wiki/France• www.wto.org/english/thewto_e/countries_e/france_e.htm

• www.doingbusiness.org/• www.invest-in-france.org/

Thank You…..