The tax consequences for inbound business investments into France will depend upon whether the investor is acquiring business assets or the shares in a French company.

Acquiring business assets

A buyer may prefer to purchase assets rather than shares. A buyer of business assets can receive a step-up in the tax basis of the acquired business assets, whereas they cannot obtain a step-up in the tax basis of the target company’s assets if they acquire shares.

The acquisition of business assets and liabilities may create a permanent establishment in France for a foreign buyer. In such a case, the permanent establishment is…

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