(Caveat: I am not a lawyer or an accountant. Seek professional advice before spending money)
It's not THAT complicated, although it is much more complex than in many other countries.
Firstly, you can be self-employed. You need to be registered with various authorities before you can trade and the authorities vary depending on what you want to do. Simply put, the French system distinguishes between three types of self-employed people:
Artisans (who make things with their hands)Commercants (who sell things other people have made)Professions Libérales (doctors, lawyers and, um, Web designers and their ilk... I suppose "knowledge workers" would be a very now term)
Within this, some activities are restricted, and may only be practiced by people who have appropriate qualifications and experience, with the evidence of this (typically) being accepted for membership of the appropriate professional organisation. Restricted professions include some obvious ones (doctor, nurse...) and some less obvious (journalist, labourer, real-estate agent...). Some also carry certain obligations, such as the hefty insurance bond that real-estate agents must post.
Depending on how much money you expect to make, you may choose to set up as a microentreprise (which is the simplest and cheapest fiscal régime) or under various other taxation systems. You may (or may not) need to be registered for TVA.
Having worked out roughly what you want to be, it's probably best to get the advice of a competent accountant. If you speak good French, alternatively, try your local Chambre de Commerce or Chambre des Métiers (thee latter for artisans) where you will get good advice.
Next up is the limited liability company. Again, there are various options although the two that are most likely to be of interest are the SARL and the EURL. Both are essentially identical except that an EURL has only one shareholder while an SARL has more than one. There is a minimum (paid-up) capital requirement of €7500, some of which will be tied up for a while, a whole bunch of paperwork to fill in and, again, you'd be best off talking to a good accountant and/or the Chambre de Commerce. With three partners, this may well be the way you want to go...
Alternatively, you can create your company overseas and have a local office for this foreign entity. This can be either a "liaison office" (if it's simply being used, say, to publicise your activities to the local market) or a "branch office" (if you are trading with the local market). Both are comparitively simple and inexpensive to set up. I gather that this apprach is actually being used by increasing numbers of French-owned businesses since it gives them a legal trading entity in France along with the greater flexibility that a limited liability company registered in England, Ireland or Delaware (say) can have - particularly important if you are planning to bring in additional partners or outside investment. Downside: paying for and managing two sets of accounts and having to operate in two jurisdictions. Again, talk to the Chambre de Commerce (my experience is that local accountants are not too familiar with the liaison/branch office approach and so tend to steer you towards something with which they are more comfortable).
One thing to remember is that the Chambre de Commerce charges a flat fee for setting you up; accountants charge by the hour. In my experience this means that the Chambre's staff see far less potential complexity in any given situation than accountants.
And for professional insurance, simply talk to your insurance agent of choice.
"The problem with the French is that they don't have a word for entrepreneur"
- George W. Bush (allegedly)
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Mike
