The UK and France have long shared a dynamic and interdependent business relationship, thanks to their proximity and strong trade ties within the European Union. Before Brexit, UK companies benefited from frictionless access to the European market, free movement of goods, services, capital, and people, and streamlined regulations that made cross-border operations relatively simple. However, since the UK’s departure from the EU in 2016, this relationship has evolved, bringing new challenges and opportunities for businesses on both sides of the Channel.
Brexit has significantly impacted UK companies, particularly those with a strong reliance on European markets. The loss of free movement and the introduction of customs checks, tariffs, and new regulatory hurdles have disrupted supply chains, increased operational costs, and created uncertainties around future trade agreements. UK-based firms now face additional layers of bureaucracy, from navigating complex VAT regulations to securing work permits for employees operating in the EU. For many, this has underscored the need to establish a physical presence within Europe to maintain smooth operations and access to EU customers.
In response to these challenges, an increasing number of UK businesses are looking to France as a strategic base for their European operations. France offers a stable and business-friendly environment, and its proximity to the UK makes it an attractive choice for companies seeking to mitigate Brexit-related disruptions. Over the past few years, cities like Paris, Lyon, and Marseille have seen a surge in UK companies setting up branches, offices, or subsidiaries, capitalizing on France’s position as a gateway to the broader EU market.
This shift represents a growing trend of UK firms choosing France to set up a business as their new European hub, allowing them to continue trading seamlessly across the continent while adapting to the post-Brexit regulatory landscape.
Benefits of Expanding to France for UK Companies
Access to EU Markets
One of the most significant advantages of establishing a French base post-Brexit is continued access to the European Union’s vast single market. UK businesses that operate from France can bypass many of the trade barriers and regulatory challenges that have arisen since the UK left the EU. By maintaining a presence in France, companies can benefit from the free movement of goods and services within the 27 EU member states, ensuring smooth, tariff-free operations across the bloc. This is particularly important for businesses reliant on supply chains that span multiple European countries or those who need to maintain relationships with EU clients and suppliers without added friction. Furthermore, having a registered entity in France allows UK firms to comply with EU regulations more easily, ensuring their products and services meet the standards required for selling within the union.
Strategic Location
France is strategically positioned as a gateway not only to Europe but also to global markets. With major seaports, airports, and road networks, France offers excellent connectivity to key economic hubs across Europe, Africa, and the Middle East. Cities like Paris and Lyon are well-connected to major European capitals, making them ideal locations for headquarters or branch offices that need to coordinate international operations. France’s robust transport and logistics infrastructure makes it easier for businesses to distribute products, reach customers, and engage with global trade partners. Additionally, its central location within the Schengen Zone allows for easy movement across EU borders, providing a strong advantage for companies looking to expand their operations beyond France itself.
Support for Foreign Investors
France actively supports foreign investors through a range of government incentives and tax benefits designed to attract international companies. The French government has implemented a series of measures, such as the “France Relance” recovery plan and the “Choose France” initiative, aimed at boosting foreign investment, particularly post-Brexit. These programs provide grants, tax breaks, and subsidies to companies that create jobs, invest in innovation, or establish research and development centers in France. Additionally, France’s competitive corporate tax rate, which has gradually been reduced to 25%, offers a more favorable environment for businesses looking to minimize operational costs. Local authorities in major cities also provide tailored support to foreign companies, helping them navigate the regulatory environment, secure office space, and access specialized financial services.
Skilled Workforce
France boasts a highly educated and skilled workforce, making it an ideal location for businesses seeking talent in sectors such as technology, finance, healthcare, and manufacturing. French universities and business schools are globally recognized for their high standards of education, producing graduates with advanced expertise in engineering, management, and digital technologies. Additionally, France’s labor market offers access to multilingual employees, many of whom are proficient in English, Spanish, German, and other key languages, which is especially beneficial for businesses operating across multiple countries. For UK companies looking to innovate and expand, the availability of a well-trained, multilingual talent pool is a crucial asset. In particular, France’s focus on developing its tech ecosystem has made cities like Paris and Lyon hotspots for startups and innovation-driven companies, further enhancing the appeal for UK businesses.
By expanding to France, UK companies can leverage these key benefits to maintain their competitiveness in Europe and beyond while navigating the post-Brexit business environment more effectively.
Why UK Businesses Are Choosing France
Case Study 1: Maintaining Access to the European Market with a Paris Office
A prime example of a UK business securing its foothold in Europe post-Brexit is ADT Corporation, a British consumer goods company that opened an office in Paris to safeguard its access to the EU market. ADT had been reliant on its European client base for a significant portion of its revenue, but Brexit introduced customs checks, regulatory divergence, and tariffs, threatening its cross-border operations.
By setting up a branch in Paris, ADT was able to continue trading seamlessly within the EU without facing the added costs and delays associated with importing and exporting goods from the UK. The Paris office also allowed them to better manage their European supply chains and customer service, ensuring compliance with EU standards. This move proved essential for maintaining their market share across the continent while keeping distribution networks efficient and cost-effective.
Case Study 2: A Tech Startup’s Move to Lyon’s Thriving Ecosystem
In the tech sector, IgniteTech, a British startup specializing in AI solutions, chose Lyon as its European headquarters. Facing growing uncertainty around UK-EU data-sharing regulations and access to EU-based customers, IgniteTech needed a reliable base within the EU to serve its expanding European client base.
Lyon stood out due to its growing reputation as a tech-friendly city with a thriving ecosystem of startups, incubators, and venture capital support. The city offers a dynamic environment for innovation, lower operational costs compared to other European tech hubs like Berlin or Paris, and access to a highly skilled talent pool. IgniteTech benefited from regional incentives for startups, such as tax breaks and grants for research and development, allowing them to scale quickly. Establishing their headquarters in Lyon not only maintained their access to the European market but also connected them with valuable local partnerships and funding opportunities.
Case Study 3: A Financial Services Firm Complying with EU Regulations
GlobeFinSolutions, a UK-based financial services firm, found itself in a difficult position post-Brexit. With the loss of passporting rights—previously allowing financial services firms based in the UK to operate freely across the EU – GlobeFinSolutions, needed a solution to retain its EU-based clients and comply with European financial regulations.
To avoid the red tape and complexity of operating solely from the UK, the company opened a branch in Paris, one of Europe’s key financial centers. By setting up an office in France, GlobeFinSolutions was able to meet the regulatory requirements for providing services in the EU, including compliance with the Markets in Financial Instruments Directive (MiFID II) and the European Market Infrastructure Regulation (EMIR). This allowed them to continue servicing their European clients without disruption, offering banking, insurance, and investment services smoothly across the bloc.
Each of these examples illustrates how UK companies are leveraging France’s stable regulatory environment, strategic location, and business-friendly policies to navigate the post-Brexit landscape. Whether it’s maintaining market access, tapping into a thriving ecosystem, or complying with EU regulations, France is proving to be a top destination for UK businesses looking to secure their European future.
Conclusion
As UK businesses navigate the challenges posed by Brexit, France has emerged as a prime destination for companies looking to maintain access to the EU market, comply with regulatory requirements, and tap into a skilled workforce. With its strategic location, business-friendly policies, and thriving ecosystems in cities like Paris and Lyon, France offers UK companies a stable platform to continue operating smoothly within Europe. By expanding into France, UK businesses can not only mitigate the disruptions of Brexit but also unlock new opportunities for growth across the European and global markets.
