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FDI in Figures | Why You Should Choose to Invest in France | Protection of Foreign Investment | Procedures Relative to Foreign Investment | Office Real Estate and Land Ownership | Investment Aid | Investment Opportunities | Sectors Where Investment Opportunities Are Fewer | Finding Assistance For Further Information
FDI in Figures
According to the 2011 published by UNCTAD , France is the tenth country in the world in terms of attracting FDI flows . Paris is the world 's second largest city after Tokyo , in terms of location of headquarters of multinationals , it hosts nearly 500 . The country recorded a decline in foreign investment due to the deteriorating international economic situation in 2009/2010 , but since then the flows have been slowly recovering .
The country's strengths include: its position as a fifth world's largest power, its highly skilled workforce, industrial base and agricultural resources and its geographic location in the center of Europe.
| Foreign Direct Investment | 2009 | 2010 | 2011 |
| FDI Inward Flow (million USD) | 34,027 | 33,905 | - |
| FDI Stock (million USD) | 1,132,961 | 1,008,378 | - |
| Performance Index*, Ranking on 181 Economies | 52 | 73 | 77 |
| Potential Index**, Ranking on 177 Economies | - | - | 11 |
| Number of Greenfield Investments*** | 1,013 | 853 | 806 |
| FDI Inwards (in % of GFCF****) | 4.4 | 5.8 | 6.9 |
| FDI Stock (in % of GDP) | 39.5 | 40.8 | 34.7 |
Source: UNCTAD - Last Available Data.
Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.
FDI Inflows By Countries and Industry
| Main Investing Countries | 2010, in % |
| Netherlands | 16.2 |
| Luxembourg | 15.7 |
| USA | 12.4 |
| UK | 11.6 |
| Germany | 10.7 |
| Belgium | 9.8 |
| Switzerland | 6.3 |
| Main Invested Sectors | 2010, in % |
| Real estate | 57.3 |
| Manufacturing | 30.6 |
| Specialized activities, research and technology | 24.4 |
| Finance and insurance activities | 3.4 |
Source: - Last Available Data.
- Form of Company Preferred By Foreign Investors
- SA: public limited company
- Form of Establishment Preferred By Foreign Investors
- The subsidiary
- Main Foreign Companies
- Sources of Statistics
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Why You Should Choose to Invest in France
- Strong Points
- France is one of the world's ten economic powers. It has quality infrastructures. The work force is qualified and productive (second in Europe in terms of hourly productivity). France is an innovative country with an highly developed tertiary fabric.
- Weak Points
- The drawbacks of the French market are: one of the highest taxation rates in the world, significant manpower costs, low competitiveness in some sectors which can hinder the economies of scale. Research suffers from insufficient collaboration between the public and private sectors.
- Government Measures to Motivate or Restrict FDI
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Foreign companies enjoy the same government aid as French companies (aid for productive investment, R&D, professional training, job creation, etc.). The number of administrative formalities for foreign companies to settle in France has been reduced.
To fight against the financial crisis, the French government has implemented different mesures: the economic relaunch plan has committed the financing of 1,000 projects. These investments bear on transport infrastructures, higher education and research, State real estate property, housing and urban redevelopment and also health. Additionally, Sarkozy's government has abolished the professional tax in order to permanantly stimulate investment. Furthermore, the government established a strategic investment fund of EUR 20 billion, in Autumn 2008. Its aim: to buy stakes in industrial companies whose development is essential to the French economy.
Protection of Foreign Investment
- Bilateral Investment Conventions Signed By France
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France has signed bilateral agreements on investments with 81 countries.
To see the list of countries,
To see the conventions, - International Controversies Registered By UNCTAD
- There is one case of controversy registered, that of Eurotunnel versus France and the United Kingdom.
- Organizations Offering Their Assistance in Case of Disagreement
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, International court of arbitration, International chamber of commerce
, International Center for settlement of Investment Disputes
- Member of the Multilateral Investment Guarantee Agency
- France is a signatory to the Convention of the .
Country Comparison For the Protection of Investors
| France | OECD | United States | Germany | |
| Index of Transaction Transparency* | 10.0 | 6.0 | 7.0 | 5.0 |
| Index of Manager’s Responsibility** | 1.0 | 5.2 | 9.0 | 5.0 |
| Index of Shareholders’ Power*** | 5.0 | 6.8 | 9.0 | 5.0 |
| Index of Investor Protection**** | 5.3 | 6.0 | 8.3 | 5.0 |
Source: Doing Business - Last Available Data.
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.
Procedures Relative to Foreign Investment
- Freedom of Establishment
- Yes. The formal investment regime remains among the least restrictive in the world.
- Acquisition of Holdings
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Possible
When more than 5% of the capital or voting rights of a company listed on the stock exchange are likely to change holders, it is compulsory to inform the Financial Market Authority (within 5 days) and the issuing company (within 15 days). - Obligation to Declare
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For any acquisition of over 10% of the capital or voting rights of a French company: declaration for statistical purposes to the credit institutions.
For any creation or acquisition of more than one third of the capital or voting rights, when the investment is over 1.5 million euros: administrative declaration to the (in French). - Competent Organization For the Declaration
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- Requests For Specific Authorizations
- Some sectors are subject to procedures to obtain prior authorization: games for money; private security; research and development activities on pathogenic or toxic agents; phone-tapping systems; information technologies; information systems security; goods and technologies with a dual use; means of cryptology in the digital economy; companies holding national defense secrets; the arms trade; companies which have concluded a contract with the Ministry of Defense.
Office Real Estate and Land Ownership
- Possible Temporary Solutions
- There are several temporary solutions: domiciliation of the company at the private address of the director, domiciliation in a business center, lodging in relay-workshops (ateliers-relais), company "nurseries" (pépinières d'entreprise) and renting professional premises.
- The Possibility of Buying Land and Industrial and Commercial Buildings
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Yes
It is possible to buy freehold or leasehold, to build industrial and commercial premises or to buy through a real estate company. - Risk of Expropriation
- According to French law, foreign investors are entitled to adequate and promptly paid compensation if they are victims of expropriation.
Investment Aid
- Forms of Aid
- Subsidies, discounts and reductions of costs, tax exemptions, loan guarantees, payment of expenses for personnel training
- Privileged Domains
- Job creation, regional development, the food industry domain, protection of the environment, aid for Research and Development,
- Privileged Geographical Zones
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- Free Zones
- Organizations Which Finance
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The State, local administrations (regions, departments, town councils)
The EU through the
Some big industrial groups which back new investors
The
The
The
, Financing and support for SMEs (merger of the ANVOR - French innovation agency - and the BDPME - Bank of the development of SMEs)
Investment Opportunities
- The Key Sectors of the National Economy
- Aerospace, automobile, food industry, pharmaceuticals, micro electrotechnology, logistics, health equipement.
- High Potential Sectors
- Call centers, biotechnologies, telecommunications, information and communication technologies, the environment
- Privatization Programs
- Electricity, gas and rail transport, postal services.
- Tenders, Projects and Public Procurement
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, French Public Procurements (in french)
, Tenders and Projects in France
, Tenders in France
, Business opportunities in EU 27
, Tenders Worldwide
Sectors Where Investment Opportunities Are Fewer
- Monopolistic Sectors
- The French government still maintains legal monopolies in public service companies: the rail network (RFF), public transport in Paris (RATP), tobacco manufacturing and distribution (Altaldis) nuclear plants (EDF).
- Sectors in Decline
- Textiles, shoes
Finding Assistance For Further Information
- Investment Aid Agency
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- Other Useful Resources
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- Doing Business Guides
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Last Updates:
July 2012
