Financial Crime World

French Guiana: A Strategic Hub for Business in South America

Located on the northern coast of South America, French Guiana has emerged as a significant hub for businesses looking to expand their operations in the region. The territory’s strategic location, stable political and legal environment, and access to the European Union market make it an attractive destination for companies.

Advantages of Doing Business in French Guiana

  • As a French overseas department, French Guiana benefits from a well-established and transparent legal system.
  • The territory’s stable political environment provides a secure and predictable business climate.

Access to EU Markets

  • French Guiana’s membership in the European Union provides businesses with access to a large market of over 500 million consumers.
  • Companies can take advantage of the EU’s single market, eliminating trade barriers and facilitating cross-border transactions.

Competitive Tax Incentives

  • The territory offers exemptions from corporate income tax and property tax for up to five years, as well as reduced social security contributions for newly established companies.
  • These incentives make French Guiana an attractive destination for businesses looking to reduce their tax burden.

Strategic Location

  • French Guiana’s proximity to Brazil, Suriname, and other neighboring countries makes it an ideal location for businesses looking to expand their operations in the Western Hemisphere.
  • The territory’s strategic location provides access to a large market of over 400 million people.

Abundant Natural Resources

  • The territory has significant reserves of gold, bauxite, and timber, presenting opportunities for companies in industries such as mining, forestry, and renewable energy.
  • French Guiana’s natural resources provide a competitive advantage for businesses operating in these sectors.

Types of Companies that can be Established in French Guiana

Sole Proprietorship (Entrepreneur Individuel)

  • This is the simplest form of business entity in France, where the business is owned and run by a single individual.
  • A sole proprietorship requires minimal formalities and paperwork.

Partnership (Société en Nom Collectif)

  • A partnership company requires at least two partners and has a partnership agreement that outlines the roles and responsibilities of each partner.
  • Partnerships are suitable for businesses with multiple owners who want to share decision-making and profits.

Limited Liability Company (Société à Responsabilité Limitée or SARL)

  • This is a separate legal entity with limited liability for its shareholders, requiring a minimum share capital of €1.
  • A SARL provides protection for its owners’ personal assets in case the business incurs debts or liabilities.

Public Limited Company (Société Anonyme or SA)

  • This is a separate legal entity with limited liability for its shareholders, requiring a minimum share capital of €37,000.
  • A SA is suitable for large businesses that want to raise funds from public investors.

Simplified Joint-Stock Company (Société Par Actions Simplifiée or SAS)

  • This is a separate legal entity with limited liability for its shareholders, requiring a minimum share capital of €37,000.
  • An SAS provides flexibility and simplicity in management and decision-making.

Cooperative (Société Coopérative or SC)

  • A business entity that is owned and controlled by its members, who share in the profits and decision-making.
  • Cooperatives are suitable for businesses with a strong social mission or community focus.

Tax Regime in French Guiana

Corporate Tax

  • The corporate tax rate in France stands at 26.5%, with a minimum annual tax of €1,500.
  • Companies must also pay value added tax (VAT) on their taxable turnover.

Value Added Tax (VAT)

  • A standard VAT rate of 20% applies to most goods and services, with reduced rates for certain items such as food, books, and children’s clothing.
  • VAT is a consumption tax that businesses must charge on their sales.

Key Contact

Surendra Singh Chandrawat is the Managing Partner at Chandrawat & Partners. He can be reached at surendra@chandrawatpartners.com.