• France's news in English

France sees record number of firms go bust

Dan MacGuill · 17 Oct 2013, 15:35

Published: 17 Oct 2013 15:35 GMT+02:00

Facebook Twitter Google+ reddit

The number of businesses going bankrupt in France has reached its highest level in 20 years, despite the recent confirmation that the Eurozone’s second-largest economy had officially exited recession.

The figures, published this month by business consultancy Altares, revealed that 12,790 companies filed for bankruptcy in the third quarter of 2013.

That’s a 7.5 percent rise from the same period last year, and the highest summertime rate of bankruptcy since 1993, when 13,500 were registered.

The previous highest third-quarter figures came four years ago, when 12,657 companies folded between July and September of 2009.

French business bankruptcies over the last 10 years. Screengrab/Altares

Even more worrying, however, was the discovery that 90 percent of the bankruptcy procedures related to businesses with less than 10 employees.

There was also a 31-percent rise in the number of medium-sized companies (more than 50 employees) going under between July and September.

Bankruptcy is obviously something that expats in France are not immune to. For all the success foreigners have had setting up business in France there are enough horror stories out there of expat-run start-ups that failed to take off.

Andrew Denison, who runs Nice-based consultancy firm Mon Ami Andy, told The Local the possibility of bankruptcy is something that expats should be particularly aware of.

“Many expats set up a business in France because it’s been their dream, or it seemed like a good idea at the time,” he said.

“But things work very differently in France than in the UK or Ireland or the US, and it can often take expat business-owners by surprise.

“For example, expats are often used to do their own accounting, and looking after their own paperwork, and they balk at the idea of paying someone else to take care of this for them,” he added.

“But when they find they haven’t scheduled payments properly, and they’re late on filing paperwork to several different agencies and bodies at the same time, it can be overwhelming for them, and they throw in the towel.

“Certainly, the possibility of moving back home and starting again is a factor which often encourages expat business-owners to file for bankruptcy in France,” said Denison.

Click below for The Local's brief guide on going bankrupt in France and how to avoid it.

Going bust: 'Never hide money from French taxman'

Story continues below…

Geographically, the worst-hit region in mainland France was Nord-Pas-de-Calais, which suffered a 29.9-percent rise since the same period in 2012.

By contrast, the Limousin region of central France actually had 9.5-percent fewer bankruptcies than last year, and the Ile-de-France region including Paris fared worse than average, with a 10-percent rise in businesses calling it a day.

How the rise in bankruptcy affected every region of France. Screengrab/Altares

Don't miss a story about France - join us on Facebook and Twitter

Dan MacGuill (dan.macguill@thelocal.com)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
How life for expats in France has changed over the years
A market in Eymet, southwestern France. Photo: AFP

Foreigners in France explain how life has changed over the years.

London calling for Calais youths, but only a chosen few
Photo: AFP

Dozens of Calais minors are still hanging their hopes on help from the UK, but not all will be so lucky.

17 different ways to talk about sex in French
Photo: Helga Weber/Flickr

Fancy a quick run with the one-legged man?

Yikes! This is what a rat-infested French jail looks like
Photo: YouTube/France Bleu TV.

This video is not for sufferers of ratophobia (or musophobia as the condition is officially called).

France to allow Baby Jesus in Town Halls this Christmas
Photo: AFP

Mary, Joseph, and baby Jesus are safe to go on display again this year, it seems.

National Front posts locations of migrants in French town
The National Front courts controversy. Photo: AFP

"Local tax payers have a right to know," says local far-right party chief.

Paris thieves use tear gas to steal €500,000 of watches
Photo: AFP

The thieves pretended to be couriers then threatened staff with tear gas to get the watches.

Bataclan survivor recounts attack in chilling drawings
Photo: BFMTV screengrab

One survivor has recounted the horrific night through illustrations.

Anger among French police grows as Hollande vows talks
French police demonstrate on the Champs Elysées. Photo: AFP

A fourth night of protests shows government efforts to ease anger among French police have been fruitless.

UK border must move back, says 'next French president'
Photo: AFP

If favourite Alain Juppé is elected, Britain and France are in for some difficult negotiations.

Sponsored Article
How to vote absentee from abroad in the US elections
Why Toulouse is THE place to be in France right now
Sponsored Article
Last chance to vote absentee in the US elections
Video: New homage to Paris shows the 'real side' of city
The 'most dangerous' animals you can find in France
Sponsored Article
How to vote absentee from abroad in the US elections
Swap London fogs for Paris frogs: France woos the Brits
Anger after presenter kisses woman's breasts on live TV
Is France finally set for a cold winter this year?
IN PICS: The story of the 'ghost Metro stations' of Paris
How to make France's 'most-loved' dish: Magret de Canard
Welcome to the flipside: 'I'm not living the dream in France'
Do the French really still eat frogs' legs?
French 'delicacies' foreigners really find hard to stomach
French are the 'world's most pessimistic' about the future
Why the French should not be gloomy about the future
This is the most useful French lesson you will ever have. How to get angry
Why is there a giant clitoris in a field in southern France?
French pastry wars: Pain au chocolat versus chocolatine
Countdown: The ten dishes the French love the most
Expats or immigrants in France: Is there a difference?
How the French reinvented dozens of English words
The ups and downs of being both French and English
How Brexit vote has changed life for expats in France
Twelve French insults we'd love to have in English
What's on in France: Ten of the best events in October
jobs available