The EU and Business in France
The European Union (EU) offers a range of funding programmes and supports for businesses based in France. These supports are used by the EU to promote business development and growth throughout Europe, as well as promote regional and economic development in the common market. Funding is provided indirectly through local or national delivery agents or directly from the European Commission. These supports are available as grants, loans, loan guarantees, equity and venture capital.
Small and medium sized businesses in France are eligible for EU funding. Eligible micro businesses must have fewer than 10 employees and a yearly turnover or balance sheet total of under €2 million. A small business is eligible if it has 250 or fewer employees and a turnover or balance sheet of below €10 million. For a medium sized business to be eligible, is must have fewer than 250 employees and a yearly turnover of less than €50 million or balance sheet of under €43 million. Individual grant or loan programmes may establish eligibility criteria.
Businesses in France may receive direct funding from the EU through the European Commission and its executive agencies. Financing from the EU is available only as grants. Grants are provided to businesses and specific projects that contribute to fulfilling EU policy objectives, including those related to regional and economic competitiveness, skills training, research and development, and the environment. To apply for direct grants, businesses respond to calls for proposals that are released by the European Commission (EC). Eligibility requirements depend on individual grants, which are generally open to all eligibly businesses regardless of their geographic location in the EU.
While the European Union does not provide direct loans or equity to businesses based in France, it does support businesses through indirect funding. Local and national intermediaries in France use EU structural funds in order to offer financing to small and medium sized businesses. Financing may be used to start or expand a business. Intermediaries include banks, associations and other lenders, which establish their own eligibility criteria and are responsible for determining how funds are flowed on individual case-by-case bases.
Two major initiatives supported or recognised by the EU in France are the Réseau Entreprendre and Initiative France. The Réseau Entreprendre provides interest-free unsecured loans on trusts for new businesses. Loans are provides to strengthen capital and promote business creation and recovery. Businesses are eligible during initial start-up and within the first few years that the business is operating. Using structural funds and national sources of funding, start-up and early stage businesses can access start-up and seed funding of between €15,000 and €50,000. Initiative France is a network association that finances and supports business start-ups and takeovers. As a result of funding in 2012, over 16,000 business and more than 37,000 jobs were created or maintained according to Initiative France. Unsecured loans without interest are provided to help businesses strengthen access to capital and obtain additional financing from banks.
France is permitted to use EU structural funds to support businesses, which is typically complemented by national funding. These funds provide equity to small and medium sized businesses in France through local or national financial intermediaries. Loans and guarantees range from microloans of just €1,500 to larger sums of up to €2.5 million for equity and venture capital investments. Funding often targets new and emerging sectors, as well as high-potential economic and business activities. Target sectors include environment, energy, life sciences, information and communication technology, and research, development and innovation. Funding may also be provided to help with the recovery of specific regions within France.
Indirect funding is also available with the Competitiveness and Innovation Framework Programme (CIP). This EU programme provides loans and equity to small and medium sized businesses where market gaps might exist. In France, CIP funding is available from national and local intermediaries, such as La SIAGIA, 360 Capital Partners, Serena Capital and Demeter Partners in France. Financing is provided as loans and guarantees, as well as larger equity investments of several million. Focus areas include expanding eco-industries and eco-energies sectors, as well as companies in key sectors such as information and communication technology, cleantech, research, development and innovation, and life sciences.
The European Investment Bank (EIB) offers loans and loan guarantees to business in France. Financing is provided for innovation, research and development activities by small and medium sized businesses, as well as financial institutions such as venture capital funds, private equity funds, banks and corporate investors. Individuals such as job seekers and journalists may also be eligible. EIB financing can be used for tangible and intangible investments. Loan guarantees and equity are also provided through the EIB's European Investment Fund (EIF). EIF financing in typically targeted to high-potential sectors, including research, development and innovation, the information and communication technology sector, cleantech (for example, clean energy), and life sciences. The EIB's Risk Sharing Finance Facility (RSFF) also supports innovative medium-sized companies by supporting research, development and innovation.
Business Support Networks
Since 2006, France and the European Union have cooperated on providing supports for new businesses. There is a one-stop business start-up centre supported by France and the EU, the Centre des formalités des enterprise (CFE). Located throughout France, these centres are the place to go when registering a business and get support when starting a business. In addition to the CFE, Enterprise Europe Network centres are also found throughout France. This network offers supports to small and medium sized business by providing information about EU programmes and regulations and policies, including procurement. Advisors also provide information on business-specific issues, such as financing, cooperation, innovation, and market research. The Enterprise Europe Network is based throughout France, including Paris, Bordeaux, Lille, Lyon, Marseille, Nantes, Rennes, Strasbourg and Toulouse.
Finding More Information
For information on the Enterprise Europe Network, visit http://een.ec.europa.eu. Calls for proposals and additional information on direct EU/EC grants are available at http://ec.europa.eu/contracts_grants/grants_en.htm. Information about applying for indirect funding from local and national intermediaries in France is available at http://europa.eu/youreurope/business/funding-grants/access-to-finance/. For information about financing available directly from the EIB, visit www.eib.org.