Inquire
Sole proprietorship (EI), single-member limited liability company (EURL), limited liability company (SARL), public limited company (SA), etc. whatever legal structure is chosen, entrepreneurs certainly have no shortage of questions!
Starting a business (or taking over an existing one) is an adventure that requires being well informed about legal, accounting, and tax regulations.
First, you need to clearly define your project to ensure it is feasible (skills, resources, constraints, etc.).
Next, it is essential to carry out a market study to assess the project’s viability (target customers, competition, etc.) and to establish projected revenue. This analysis helps evaluate supply and demand within a given market and shape an appropriate commercial strategy. At this stage, it is advisable to prepare a business plan to determine financing needs, assess the project’s profitability potential, and choose the appropriate legal structure. The business plan is a concise document designed to clearly present the key aspects and implications of the project.
As for the legal status, it defines the company’s legal framework. Depending on the intended activity and the level of asset protection sought, certain legal forms may be more or less suitable. Once this choice has been made, the business registration process can begin.
Starting a Business: Why Consult a Notary?
Marital property regime, declaration of exemption from seizure of personal assets, protection mandate.
Maître David MENNETRET, notary in Reims and President of the Institute for Business and Corporate Notarial Law, and Maître Florence POUZENC, notary in Paris, share their advice (conference held at the Go Entrepreneurs trade fair on 9 June 2021).
Which legal status should you choose to create your business?
Opt for a sole proprietorship (without legal personality)
A sole trader is a natural person who conducts a commercial, industrial, or professional activity in their own name, without forming a separate legal entity.
Until then, a natural person wishing to carry on a professional activity in their own name could choose between two regimes: the Sole Trader (entrepreneur individuel - EI) or the Limited Liability Sole Trader (Entrepreneur Individuel à Responsabilité Limitée - EIRL).
Law No. 2022-172 of 14 February 2022 on independent professional activity abolished the EIRL regime, leaving a single legal status, that of Sole Trader (Entrepreneur Individuel - EI), as provided for under Articles L526-22 to L526-26 of the French Commercial Code.
This single status is more protective and simpler: since 15 May 2022, a sole trader automatically (without any formalities) benefits from a professional estate that is separate from their personal estate, thereby protecting both themselves and their family from the risks inherent in their business activity.
In addition, the administrative and legal framework has been simplified, whether in relation to the formalities required for the creation and management of the business or for its transfer.
To find out more about setting up a sole proprietorship:
Good to note: Within the framework of a sole proprietorship, the sole trader may opt for the micro-enterprise regime and thereby benefit from a simplified micro-social scheme (Article L613-7 of the French Social Security Code) and a simplified micro-tax regime, as well as reduced administrative requirements.
A micro-entrepreneur may carry out all craft activities, most commercial activities, and certain professional (liberal) activities. However, certain agricultural, real estate, or artistic activities cannot be carried out under this regime.
Choose to create a company, a legal entity separate from the entrepreneur
It is also possible to create a company (EURL, SARL, SA, SAS, etc.), that is, a legal entity separate from the entrepreneur. Incorporating a company is possible for a single individual (EURL or single-member SARL) and becomes mandatory when there are two partners. This option is particularly relevant, for example, for those who set up a substantial structure from the outset and require an appropriate tax and social security framework.
There are two main categories of companies: civil companies and commercial companies, depending on the nature of the business activity carried out.
Civil company
An entrepreneur wishing to carry out real estate, professional (liberal), or agricultural activity will need to opt for a civil company:
• Real estate civil company (SCI),
• Professional civil company (SCP),
• Civil property allocation company,
• Civil construction and sale company (SCCV),
• Civil holding company (portfolio company), etc.
Note: Generally, partners in civil companies are personally and indefinitely liable for the company’s debts; however, they are not jointly and severally liable. Their liability is proportionate to their share in the company’s capital (French Civil Code, Article 1857).
Trading company
Conversely, an entrepreneur who wishes to carry out a business activity involving buying and reselling goods, leasing, transport, etc., will opt for a commercial company, such as:
• a public limited company (SA),
• a simplified joint-stock company (SAS) or a single-member simplified joint-stock company (SASU),
• a limited liability company (SARL) or a single-member limited liability company (EURL),
• a general partnership (SNC), etc.
Other factors must also be taken into consideration when choosing a legal status: whether the number of partners is limited or open to new partners, how the company operates (human resources, financial resources, etc.), the social security status of the company director, and the company’s tax regime.
A notary is a key professional to consult for advice on choosing the most suitable legal status, taking into account one’s family situation, assets, and business project.
Once the company’s legal form has been chosen, certain formalities must be completed, in particular filing the registration application with the INPI (French National Institute of Industrial Property) via the formalites.entreprises.gouv.fr website
What financial support is available for starting a business?
When setting up a business, if the project requires funding, various forms of support are available to entrepreneurs.
These may take different forms: the payment of a sum of money, tax relief, exemption from social security contributions, assistance with administrative procedures, etc. For example:
ARCE (Aid for Taking Over or Starting a Business)
This is financial support paid by France Travail to unemployed jobseekers receiving benefits, in the form of a lump sum corresponding to 60% of the remaining unemployment benefit entitlements. Find out more about ARCE.
ACRE (Aid for Creating or Taking Over a Business)
This scheme provides a partial exemption from social security contributions for twelve months. Subject to certain conditions, it is available to unemployed jobseekers receiving benefits, recipients of ASS or RSA, young people under 25, etc.
Applicants must create or take over a business either as a sole trader or through a company structure. Find out more about ACRE.
Tax relief for Young Innovative Companies (JEI status)
Young Innovative Companies (JEI) benefit from tax reductions and exemptions from certain social security contributions. Find out more about JEI.
Solidarity Honor Loan
A solidarity honor loan (interest-free loan without collateral) may also be granted to unemployed individuals, young entrepreneurs, and other project holders, subject to certain conditions.
Regional Support Schemes for Business Creation and Takeover (former NACRE scheme)
When setting up a business, the NACRE scheme (New Support for Business Creation or Takeover) was previously a state-run program. Since 2017, responsibility for business creation and takeover support has been transferred to the regions.
Each region now offers its own support scheme, which may include assistance with developing the business plan, structuring the financing, and/or monitoring the company’s development.
For example :
• The Auvergne-Rhône-Alpes region offers diagnostic services and support to help “boost” a business creation or takeover project.
• In Normandy, the region provides project assessment and preparation, assistance with drafting the financing plan, and follow-up support for up to three years.
Other types of support also exist, including
Bank guarantees, mentoring and advisory services, grants, investment funds, and more.
To find out more about available support schemes, consult the official reference database of business support programs.
How can you protect your personal assets?
According to INSEE, In 2025, nearly 75% of new businesses are registered as sole proprietorships (with almost 90% opting for the micro-entrepreneur regime), while around 25% of entrepreneurs choose to set up a company structure.
In this context, the issue of protecting the sole trader’s personal assets is of major importance.
Former Limited Liability Sole Trader status (EIRL)
Until 2022, sole entrepreneurs had a single pool of assets comprising both their business and personal property, without distinction. In the event of financial difficulties or bankruptcy, self-employed professionals, craftspeople, traders, or farmers were liable for their professional commitments with all their assets (both business and personal).
To protect themselves against such risks, they could file a declaration of exemption from seizure (drawn up by a notary, making their private real estate assets exempt from claims by professional creditors) or opt for the EIRL status (Limited Liability Sole Trader), which allowed them to allocate certain assets specifically to their business activity. Only those allocated assets being liable in the event of financial difficulties.
Note: the sole entrepreneur’s primary residence is automatically exempt from seizure by law (French Commercial Code, Article L526-1).
New legal status for sole entrepreneurs
French Act No. 2022-172 of 14 February 2022 in favor of independent professional activity abolished the EIRL (Limited Liability Sole Trader) status and introduced a new legal status for sole entrepreneurs (EI).
Since 15 May 2022, sole entrepreneurs automatically have two separate asset pools by operation of law: a professional estate and a personal estate. This separation protects both the entrepreneur and their family from risks arising from the business activity (French Commercial Code, Articles L526-22 et seq.).
Incorporating a limited liability company (such as SARL, EURL, SAS, etc.) also makes it possible to protect the shareholders’ personal assets, as professional creditors cannot seize them. The entrepreneur’s liability is therefore limited to the amount of their contribution to the company’s share capital.
Please note: this limited liability may, in certain cases, be called into question, in particular if the company director has provided a personal guarantee for the business, has committed management faults, or has engaged in fraudulent conduct.
How can you protect your spouse when starting a business?
Most couples are married under the community of property reduced to acquisitions regime, which is the default statutory regime applicable to spouses who have not entered into a prenuptial agreement.
However, spouses may change their matrimonial property regime if the one initially chosen no longer suits their situation. This is often the case when one of them starts a business.
The separation of property regime is frequently preferable, as it helps protect family assets, simplifies business management, and ensures the continuity of the business in the event of a separation.
Thus, in the event of financial difficulties, creditors cannot seize the entrepreneur’s spouse’s assets.
Moreover, in the event of divorce, the company does not form part of the joint marital assets; therefore, the spouse cannot claim half of it.
The same applies in the event of the spouse’s death: the company does not form part of the deceased spouse’s estate.
However, the separation of property regime may also be perceived as a source of imbalance or unfairness. A spouse who does not carry out any professional activity may find themselves financially vulnerable in the event of separation or the entrepreneur’s death.
When the spouse (or civil partner) takes part in the company’s activity, this involvement must be officially declared. Three legal statuses exist: shareholder spouse, employee spouse, and collaborating spouse (French Commercial Code, Articles L121-4 et seq.).
The choice of matrimonial property regime or of the spouse’s/partner’s legal status is therefore crucial. It is advisable to consult a notary to choose the most appropriate solution.