- In the banking and financial sectors
- An office in order to exercise the activities of information, liaison and representation – The French competent authority must be notified of the project. It is important to underline that a representative office is not allowed to do global marketing for its services.
- An establishment – An authorization is required from the French competent authority. The conditions to deliver the agreement are close to those applicable to opening a subsidiary.
- A subsidiary – An authorization is required from the French competent authority. The subsidiary will have to fulfil the same requirements as any other French service provider as it is a French legal person.
- In the insurance sector
In order to carry out insurance activities in France, insurance companies established in a third-party country will in most cases be subject to French local licensing requirements and, will likely have to establish a French branch which will have to secure a French license. Meanwhile, insurance companies established in an EU member state will be able to carry out insurance activities in France under, and in compliance with, the passport rules set forth by the Solvency II Directive, whether under the Freedom of Establishment or under the Freedom of Services. The ACPR will be the counterpart of the other insurance supervisory authorities of the EU member states for the notifications required under the passport rules when an insurance company wishes to operate (inbound or outbound).
As far as reinsurance is concerned, non-EU reinsurers may generally operate in France without a license, but at the cost of granting guarantees or collaterals to secure their reinsurance obligations.
To carry out insurance distribution in France, insurance intermediaries established in a third-party country will have to establish a branch in France and secure its registration with ORIAS. Meanwhile, insurance intermediaries established in an EU member state will be able to carry out insurance distribution in France under, and in compliance with, the passport rules set forth by the Insurance Distribution Directive, whether under the Freedom of Establishment or under the Freedom of Services. The ORIAS is the counterpart of the insurance supervisory authorities of the EU member states for the notifications required under the passport rules when an insurance intermediary wishes to operate (inbound or outbound).
A firm outside of France offering financial products or services to a client or a counterparty located in France might trigger the application of French laws and regulations. The service provider will need to consider whether the activity triggers French licensing obligations.
The regulation applicable to a financial services provider doing business in France depends on its country of origin and the way it operates in France. A distinction needs to be made between service providers licensed in another EU country and third country service providers.
European Union service providers
The following procedures (passporting) are applicable when a European Union service provider intends to open an establishment or exercise the freedom to provide services across the European Union, including in France.
If the financial services provider has already been authorized in a European Union country for a financial service harmonized at the level of the EU, it will only need to contact the competent regulatory authority in the country of origin of the service provider (home state regulator) and inform it of its intention to provide the same services in other EU countries. Obviously, the service provider can only offer the services for which it has been authorized by its home state regulator. The home state regulator then contacts the host state regulator and informs it of the service provider's intention to provide services in the host state. The host state regulator can object under certain limited circumstances. The whole procedure of passporting can take up to two months.
If the service provider exercises its freedom of establishment, it still needs to establish a branch or agency in the host country before it starts business.
For services that are not harmonized at the EU level, cross-border services as such are not available. Such service providers must open at least a branch in France or create a regulated subsidiary.
Third-country service providers
A foreign service provider authorized outside the European Union can decide between opening a representative office, an establishment, or a subsidiary in France. Each option requires a special authorization or notification, depending on the level of services provided.
The following must be considered if the service provider intends to open any of the following: