EU Inc in France: How It Compares to the SAS and SARL

EU Inc is a proposal, not an available alternative to a French SAS or SARL. Under COM(2026) 321, a qualifying application through the central interface using an EU template would have a 48-hour deadline and a maximum registration cost of EUR 100. The proposal has not been adopted, and there is no official launch date.

Introduction to Business Formation in France

France has long been one of Europe's most attractive business destinations, offering access to 450 million EU consumers and a sophisticated legal framework. The SAS (Société par Actions Simplifiée) is currently the most popular commercial company form in France, with its high flexibility making it especially attractive to entrepreneurs focused on growth and collaboration.

According to INSEE data, 67% of companies created in 2020 were SAS structures, compared with 31% for SARL. These remain available options today. EU Inc could add another option if the EU legislature adopts it.

The traditional French incorporation process requires several steps. Name verification with INPI, drafting articles of association, capital deposit, legal notice publication, and RCS registration. Company formation typically takes 10 to 20 business days if all documents are complete, though this timeline can extend if foreign documents require apostille or translation.

Understanding the French SAS (Société par Actions Simplifiée)

The SAS has become France's preferred corporate vehicle for good reason. The société par actions simplifiée is a French business entity that is the first hybrid entity enacted under French law based on common law principles, similar to a limited liability company under United States law, as the Delaware LLC was the model used by the French government.

Key Characteristics of the SAS

• Minimum Capital: French law does not set a statutory minimum for an SAS; EUR 1 is a commonly used nominal amount, while actual funding needs depend on the business.
• Shareholders: Shareholders can be individuals or legal entities, and a single shareholder results in a SASU.
• Management: A president (Président) is mandatory and represents the company externally, bearing civil and criminal liability in cases of mismanagement.
• Taxation: By default, the SAS is subject to corporate tax (IS), with a standard rate of 25%.
• Flexibility: The SAS is characterized by great flexibility, as its associates are free to determine in the statutes the modalities of its functioning.

The SAS is a flexible business structure used by startups and larger companies. It can be formed with nominal capital, while its governance rules are largely set in the articles.

The SARL (Société à Responsabilité Limitée) Explained

The SARL represents the traditional choice for French SMEs. A SARL is a type of business entity that can be established by at least 2 and up to 100 partners, as specified in Article L223-3 of the French Commercial Code.

SARL Structure and Requirements

• Partners: SARL in France can have from 2 shareholders up to 100.
• Capital: No minimum share capital is required, allowing EUR 1 formation.
• Management: One or more managers (gérants) run the company, and managers must be natural persons, whether or not they are shareholders.
• Limited Liability: Partners are only liable up to the amount of their contributions.
• Taxation: By default, a SARL is subject to corporate tax (IS), but under certain conditions it can temporarily opt for personal income tax (IR).

The SARL provides a secure legal framework governed by the French Commercial Code and is particularly suitable for family projects or entrepreneurs taking their first steps in France. However, its more rigid structure makes it less attractive than SAS for venture-backed startups.

EU Inc: The 28th Regime Alternative

EU Inc would differ from both SAS and SARL because the core instrument is proposed as a directly applicable EU regulation rather than a national company form. If adopted, it would create a European limited-liability form in each Member State's legal order. National law would still matter for areas outside the Regulation and for tax, employment, licensing and other operating obligations.

"Our entrepreneurs, the innovative companies, will be able to register a company in any member state within 48 hours, fully online. They will enjoy the same capital regime all across the EU."

— Ursula von der Leyen, European Commission President, World Economic Forum Davos, January 2026

Core Features of EU Inc

According to the European Commission, the proposal would provide digital registration and simplify specified company-law procedures. The 48-hour deadline and EUR 100 ceiling are not universal: they apply to the qualifying central-interface route using the harmonised application and EU articles template.

The proposal would create a central interface connected to BRIS. Where founders submit the harmonised application with articles based on an EU template through that interface, preventive control and registration would have a 48-hour deadline and a maximum cost of EUR 100.

The proposal also includes a common optional employee-equity scheme with a proposed deferral mechanism. National tax, employment and social-security rules would still determine important consequences, and the provision may change during negotiations.

The Gap-Filling Problem

However, EU Inc is not a complete replacement for national law. Article 4 states: 'Matters that are not covered by this Regulation or by the articles of association shall be governed by national law, including the provisions transposing Union law, which apply to relevant national legal forms in the Member State in which the EU Inc. has its registered office'.

Under the Commission proposal, national law would fill matters not covered by the Regulation or articles. France would need to designate a reference form; whether that would be the SAS, SARL or another form is not final.

"For every harmonised rule, there is room for member state discretion or a gap-filling reference to national law that quietly reintroduces the very fragmentation the regime purports to eliminate."

— Oxford Law Blog analysis of COM(2026) 321, March 2026

Side-by-Side Comparison: EU Inc vs SAS vs SARL

When EU Inc Could Be Relevant in France if Adopted

EU Inc becomes the optimal choice in specific scenarios where its unique advantages outweigh the maturity and established case law of French structures.

Ideal Use Cases for EU Inc

Cross-Border Operations from Day One. A common corporate-law layer could reduce some duplication, but one EU Inc would not automatically remove the need for local branches, subsidiaries, payroll registrations, licences or tax registrations. Those duties depend on where the company has people, premises and regulated activities.

Speed-Critical Launches. If the proposal is adopted, the 48-hour deadline could help qualifying founders who can use the central interface and standardised template. It should not be treated as available for current financing or contractual deadlines.

Equity Compensation for International Teams. The proposed optional employee-equity scheme could standardise part of the instrument, but it would not eliminate national tax, payroll, employment or social-security analysis for international teams.

Foreign Founders Without French Presence. The proposed digital formation route could reduce document-handling friction. It would not remove French immigration, identity, registered-office, banking, beneficial-ownership or sector-licensing requirements where they apply.

When to Stick with SAS or SARL

Traditional French structures remain superior in several contexts. If your business is purely domestic with no cross-border ambitions, the established case law, local expertise ecosystem, and familiarity of SAS/SARL outweigh EU Inc's novelty. SARL is ideal for stable businesses with limited growth expectations and a focus on local markets.

For businesses requiring highly customised governance from inception, the SAS's contractual freedom may exceed what EU Inc templates accommodate. The actual content of the standard EU templates is nowhere defined in COM(2026) 321 final, it is delegated entirely to future implementing acts under Article 8. Whether those templates will accommodate multiple share classes, preferred equity, weighted voting rights, and the other complex features that any high-growth company raising external capital will need from day one remains to be seen.

Industries requiring specific French regulatory approvals or professional qualifications may find the national structures provide clearer compliance pathways until EU Inc case law develops.

Practical Considerations for Foreign Entrepreneurs

Registration and Documentation

Foreign entrepreneurs must understand the practical requirements. To start a business in France, you'll need a residence permit or to be an EU citizen, a social security number, and a French address. In addition, you have to be at least 18 years old. EU Inc may streamline incorporation, but visa and residence permit requirements remain governed by national immigration law.

French SAS and SARL formations commonly involve a capital-deposit account and bank verification. The Commission proposal removes a bank account as a prerequisite for the qualifying EU Inc fast track, but normal banking, identity and anti-money-laundering checks would still apply when the company later opens an account.

Interpretation Risk and Legal Uncertainty

A potential concern is interpretation risk. National courts would apply the Regulation in individual cases, while the CJEU could provide authoritative interpretation through preliminary rulings. Different first-instance approaches may arise, but divergence is not inevitable and no EU Inc case law exists yet.

The Societas Europaea precedent is instructive. The Societas Europaea, the EU's previous attempt at a unified company form created in 2001, deferred extensively to national law and produced fewer than 4,000 registrations in two decades. The SE Regulation contains over 60 express references to national law, producing a different SE variant for each Member State. Approximately 3,000 SEs had been registered by 2018, of which only around one quarter were genuine operating companies.

For a detailed analysis of this risk, see our article on national court interpretation challenges.

Tax and Labour Law Remain National

Entrepreneurs should recognise that the proposal does not harmonise taxation or employment law. An EU Inc taxable in France or employing people there would generally face relevant French tax, social-security and labour rules, while cross-border facts could create obligations elsewhere too.

This creates a curious situation where the corporate legal form is European, but the practical day-to-day regulatory burden remains overwhelmingly national. The advantage lies primarily in cross-border operations and capital raising, not in domestic compliance simplification.

The Once-Only Principle and Digital Infrastructure

One potential advantage is administrative efficiency. The proposal would digitise specified procedures and transmit register data to relevant authorities under the once-only principle, with safeguards against fraud and abuse.

In practice, the proposal would allow information already held in the business register to be reused by relevant authorities. The once-only principle is an administrative data rule; it would not cancel substantive tax, payroll, social-security, beneficial-ownership or licensing filings that national law still requires.

Conversion and Flexibility

The Commission proposal includes conversion routes for eligible existing companies, but no French company can convert today. Eligibility, procedure and tax consequences depend on the final text and implementation.

If conversion routes survive in the adopted text, an eligible French company might later convert. Founders should not assume that path, timing or tax neutrality until the final rules exist.

What This Means for Your Business

EU Inc is a significant company-law proposal. If adopted, it could change the incorporation calculus for some cross-border founders through a digital route and a more consistent corporate-law layer. Until then, SAS and SARL remain the operative choices in France.

However, it is not a universal replacement. The regulation's reliance on national gap-filling law, the uncertainty around template flexibility, and the absence of established case law create risks that mature businesses or complex governance structures may find unacceptable. The SAS remains the gold standard for venture-backed French startups requiring sophisticated capitalisation tables and investor rights.

For entrepreneurs operating across multiple EU jurisdictions, EU Inc may eventually offer useful corporate-law standardisation. Its value cannot yet be quantified: the fast-track limits are conditional, employee-equity treatment remains partly national, and local operating obligations may still apply.

As the proposal moves through the legislative process, monitor the final text, implementing measures and national interaction rules. Do not delay a required incorporation on the assumption that EU Inc will launch in a particular year; no official registration date has been set.

For a comparison of how EU Inc differs in Germany's regulatory context, see our analysis of EU Inc in Germany. To understand the broader regulatory framework, consult our comprehensive EU Inc guide or use our structure assessment tool to determine which form best fits your specific business model.

Primary sources

• Commission proposal COM(2026) 321
• European Parliament procedure file 2026/0074(COD)
• French official business portal: choosing a legal form