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U.S. Department of State
France Country Commercial Guide for FY 95-96
Office of the Coordinator for Business Affairs
Country Commercial Guide for FY 95-96
France
TABLE OF CONTENTS
CHAPTER I. EXECUTIVE SUMMARY
CHAPTER II. ECONOMIC TRENDS AND OUTLOOK
CHAPTER III. POLITICAL ENVIRONMENT
CHAPTER IV. MARKETING U.S. PRODUCTS AND SERVICES
CHAPTER V. LEADING SECTORS FOR U.S. EXPORTS AND INVESTMENT
CHAPTER VI. TRADE REGULATIONS AND STANDARDS
CHAPTER VII. INVESTMENT CLIMATE
CHAPTER VIII. TRADE AND PROJECT FINANCING
CHAPTER IX. BUSINESS TRAVEL
APPENDICES:
APPENDIX A: COUNTRY DATA
APPENDIX B: DOMESTIC ECONOMY
APPENDIX C: TRADE
APPENDIX D: INVESTMENT STATISTICS
APPENDIX E: U.S. AND COUNTRY CONTACTS
APPENDIX F: MARKET RESEARCH
APPENDIX G: TRADE EVENT SCHEDULE
This Country Commercial Guide (CCG) presents a comprehensive look
at France's commercial environment through economic, political and
market analyses.
The CCGs were established by recommendation of the Trade
Promotion Coordinating Committee (TPCC), a multi-agency task
force, to consolidate various reporting documents prepared for
the U.S. business community. Country Commercial Guides are
prepared annually at U.S. Embassies through the combined efforts
of several U.S. government agencies.
CHAPTER I. EXECUTIVE SUMMARY
The market in France has long been and will continue to be of major
importance to U.S. suppliers across a wide range of industrial and
consumer goods, food & agricultural products, and services. France is
the eighth-largest trading partner of the United States worldwide and
the third-largest in Europe (after the United Kingdom and Germany).
Overall, the United States and France share many trade similarities,
particularly their global status as leading high technology innovators
and exporters, as well as the world's top two exporters of defense
products, agricultural goods, and services. Statistics on U.S.
merchandise trade show that U.S. exports to France grew by 9 percent a
year between 1987 and 1993, while U.S. imports went up by an average of
6 percent annually. U.S. merchandise exports increased slightly in 1994
to $13.6 billion, but with $16.8 billion in U.S. imports of French goods
the U.S. trade deficit with France climbed to over $3 billion. Based on
first quarter figures, U.S. exports are expected to reach $14.8 billion
in 1995, and imports from France will remain at the 1994 level. The
attractive pricing of U.S. goods resulting from the weak dollar should
account (or be blamed) for part of the turnaround.
Although unemployment still stands at a politically unacceptable level
(above 11 percent) and consumer spending has not yet returned to pre-
recession levels, the French economy is firmly on the path to economic
recovery, brightening the outlook for the close commercial relationship
between France and the United States.
The new government of recently-elected French President Jacques Chirac
has committed to making inroads in reducing the 3.3 million unemployed
workers in France through increased spending on job creation measures,
including retraining and employer subsidies, to be funded in part by
raising the VAT to 20.4 percent. Seeking to carry out Chirac's campaign
promises, Prime Minister Juppe's first major policy address to the
National Assembly had one overriding theme -- reducing unemployment.
This forms the backdrop for a seemingly impossible fiscal balancing act
between financing the new government's job creation programs and its
pledge to reduce the general government deficit to the level prescribed
under the EU Maastricht Treaty (3 percent of GDP) by the year 1997.
Driven by a surge in manufacturing activity due to strong exports, the
French economy rebounded from a negative rate of growth in 1993 to post
a 2.8 percent jump in GDP during 1994. Economic growth is expected to
continue at around 3 percent in 1995 and 1996, buoyed by rising levels
of private domestic business investment. Inflation is running at an
annual rate of less than 2 percent in France -- the lowest in the 15-
country European Union. The medium term growth prospects of the French
economy, combined with a current account surplus, low inflation and some
recent employment gains to stoke consumer spending, present a relatively
upbeat economic and commercial setting.
In general, the dynamic French commercial environment is favorable for
sales of U. S. goods and services. Owing to the complementary of the
types of goods and services that the two countries export to each other,
marketing products and services in France is much like marketing them in
the U.S., but with significant differences in cultural factors and the
legal framework. Concerning French marketing and distribution channels,
the most noteworthy trends include the explosive growth of super-markets
and hyper-markets (at the expense of small- and medium-sized family
enterprises), mail order marketing, and franchising, where U.S.-owned
franchises achieved EU-high sales of $9.2 billion in 1994 and are
enjoying average growth rates of 12 percent per year.
There remain, however, isolated cases involving the regulation and
reform of such sectors as air transport, broadcasting & radio, and
telecommunications in which French government action (or inaction) is
heavily influenced by strong domestic interest groups and serves to
limit the market access of U.S. firms. Nevertheless, taken in the
aggregate, these and other French or EU commercial obstacles do not
begin to compare in scale with the many market opportunities in France.
Among the top non-agricultural sectors considered to offer "best
prospects" for U.S. business in France are (in order of market size):
computer software, industrial chemicals, electronic components,
computers & peripherals, security & safety equipment, electrical power
systems, aircraft & parts, films/videos & other recordings, avionics,
medical equipment, defense industry equipment, automobiles & parts,
pollution control equipment and telecommunications. On the services
side, the huge French markets for travel & tourism, employment services,
and insurance hold the most potential for American suppliers.
French imports of U.S. food & agricultural products (including
manufactured tobacco, spirits, and wood & products) during 1994 were
valued at $881 million, a 9.2 percent decrease compared to 1993. French
agricultural imports are trending toward consumer-ready foodstuffs and
away from bulk commodities for animal feeds. In 1994, fresh, frozen
and/or dried fruits were the leading U.S. agricultural export to the
French market in terms of value, accounting for 14 percent of total U.S.
agricultural exports to France. Wood & products and fish & seafood
followed as numbers two and three by value, making up 13 and 11 percent,
respectively, of 1994 U.S. agricultural exports to France.
The French market for food products is mature, sophisticated and well-
served by suppliers from around the world. For U.S. agricultural
products, therefore, it is unlikely that major business breakthroughs
will occur, but, rather, that business opportunities will be created in
such niche markets as regional U. S. foodstuffs (Tex-Mex, Cajun and
California cuisine). U. S. agricultural products are perceived as being
of high quality, although at times landed prices appear high.
The French government is actively striving to attract foreign
investment, recognizing its importance as a source of new jobs. The
recent announcement by the new government of its intention to eliminate
of restrictions on investments by non-EU investors is a positive
indication of the improving investment climate. The continuation of a
major privatization program is creating a variety of new investment
opportunities in business sectors that were previously state-controlled.
France offers a variety of financial incentives to American and other
foreign investors, and its investment promotion agency, DATAR, provides
extensive assistance to potential investors both in France and through
its agencies around the world. Financial subsidies and tax incentives
are offered at the local, regional and national government level to
attract investment to the country's economically depressed areas. Such
incentives are available equally to French and foreign investors.
Furthermore, foreign companies registered in France receive the same
treatment with respect to participation in technology development
programs sponsored by the French government and have equal access to R &
D funding. In 1993, sales by U.S. affiliates in France totaled $100
billion, while French affiliate sales in the United States hit $102
billion.
In support of U.S. commercial interests in France, the U.S. Embassy in
Paris is pursuing a "Strategic Commercial Plan" using the combined
resources of the various Trade Promotion Coordinating Committee member
agencies within the Embassy. Key objectives of this post commercial
strategy are to promote increased exports of U.S. goods and services
(including tourism), to monitor and supply information on areas of
opportunity (e.g. the French government's privatization program), and to
advocate effectively on behalf of U.S. firms.
Country Commercial Guides are available on the National Trade Data Bank
on CD-ROM or through the Internet. Please contact STAT-USA at 1-800-
STAT-USA for more information. To locate country commercial guides via
the Internet, please use the following World Wide Web address: WWW.STAT-
USA.GOV. CCGs can also be ordered in hard copy or on diskette from the
National Technical Information Service (NTIS) at 1-800-553-NTIS.
CHAPTER II. ECONOMIC TRENDS AND OUTLOOK
A. Major Trends and Outlook
The French economy continues its cyclical upturn, after a sharp
turnaround in 1994, when real GDP grew by 2.8 percent from a 1.5 percent
decline in 1993. All indications are that this recovery will be
sustained. Real GDP growth during the first quarter of this year was
0.7 percent. Our current forecast calls for real GDP to grow by 3
percent this year and 2.9 percent in 1996. Economic growth over the
next eighteen months will continue to be led by investment and export
demand, and starting from the second half of this year, households will
play a more active role. These rates of growth should mean some
improvement in both the jobs outlook and the budget deficit, the twin
headaches of the French government.
Economic growth at the end of 1994 was led by the manufacturing sector
which was in turn due to strong exports and a faster upturn in business
investment. Recent indicators confirm that investment demand remains
strong. For example, the most recent survey of investment intentions
shows that industrialists plan to increase business investment by 13
percent this year, which translates into an 11 percent increase in
volume, assuming an inflation rate of 2 percent. The increase in
business investment is primarily due to improved demand (principally
industrial demand) and profits. Over the near-term, our forecast calls
for business investment to expand by a 7-8 percent annual rate, somewhat
lower than figures indicated in the surveys but still a substantial
jump. Overall investment should grow by around 5 percent this year
taking into account slower public sector growth and household
investment.
Unlike business investment, household consumption has not performed as
well as expected, falling by 0.2 percent during the fourth quarter of
1994, after an increase of 0.8 percent in the third quarter and 1.2
percent in the second quarter. Household consumption had been sustained
during the first three quarters of last year by a decline in the savings
rate, from 13.9 percent in the third quarter of 1993 to 12.9 percent in
the third quarter of 1994. Thereafter, however, the savings rate
climbed up again, which most analysts attribute to uncertainties
associated with the just-concluded presidential elections. Indeed,
current indicators, such as household consumption of manufactured
products, show that consumption continued to be relatively flat through
the first quarter and perhaps into the early months of the second
quarter of 1995. However, with the decreasing uncertainty associated
with the conclusion of the presidential election, household consumption
should show more strength in the second half of this year and next year.
Our forecast calls for overall consumption to grow by 2.1 percent this
year and 2.7 percent in 1996.
Perhaps the most significant uncertainty associated with the current
economic outlook is the macroeconomic policy stance of the new French
government. President Chirac won the election promising changes, in
particular to reduce unemployment, now numbering 3.3 million workers or
11.6 percent of the labor force. This "jobs first" approach was echoed
by his newly-named prime minister, Alain Juppe, and by his Minister of
Economics and Finance, Alain Madelin. Emphasis on jobs has created
uncertainties as to whether control of inflation and the budget deficit
will now take a back seat, which in turn raises questions on the future
of the strong franc policy and the French government's commitment to
meeting the Maastricht fiscal criteria by 1999. The new government's
supplemental budget, announced June 22, contains a variety of new
measures aimed at job creation. These new measures will cost an
estimated FRF 14.6 billion for the remainder of 1995. In order to pay
for this program and a sizable overshoot of the budget deficit inherited
from the previous government, the GOF has announced tax hikes (VAT,
corporate tax, and wealth tax) and expenditure cuts.
The projected real GDP growth rates -- 3 percent this year and 2.9
percent in 1996 -- are probably enough to create around 200,000 jobs
each year, or around a 1.5 percent increase a year. However, the
corresponding decrease in unemployment will be less, mostly due to
increasing labor force participation. Our projection calls for the
unemployment rate to average around 12 percent this year and 11.5
percent in 1996.
B. Principal Growth Sectors
Between 1990 and 1994 the fastest growing sectors, as measured by
nominal value-added were Energy (27 percent increase), Food Processing
(25 percent increase), Consumer Goods (20 percent increase),
Miscellaneous Services -- excluding retail trade, transportation,
telecommunications, and financial services (19 percent increase),
Transportation and Telecommunications Services (16 percent increase).
C. Government Role in the Economy
France has a centuries-old tradition of highly centralized
administrative and governmental control of its essentially market
economy. In 1994 French general government total outlays were 54.9
percent of nominal GDP, compared to 33.5 percent in the United States
and 42.9 percent in the United Kingdom. For more than a decade, both
Socialist and Center-Right governments have accepted that reducing
government involvement is the best way to spur economic growth and
reduce the high unemployment rate. The privatization process initiated
in late 1993 by the prime minister Balladur will continue under current
Prime Minister Juppe. In late June, the new government successfully
privatized Using Sacilor, Europe's largest steel producer. This sale
marked the seventh company to be privatized in a program involving 21 of
France's flagship companies, such as Rhone-Poulenc, Elf-Aquitaine and
Banque Nationale de Paris. Further privatization's, including Pechiney
and Renault, are in the works.
D. Balance of Payments Situation
On the external side, French exports remain strong. In February, French
exports were up 2.6 percent from January. French exports (customs
clearance basis) have maintained an annualized growth rate of well over
10 percent since the middle of last year. This strength is mainly
explained by strong world demand, with firm growth both in Europe and
North America. French imports have also been strong due to vigorous
domestic demand, especially gains in the industrial sector. Over the
next eighteen months, we expect further gains in exports and imports,
with both increasing by close to 7 percent in volume terms this year,
and slightly less in 1996. These increased rates translate into
sizable current account surpluses, around USD10 billion in 1995 and USD9
billion in 1996.
Among third country markets and suppliers, the United States is the
leading supplier of food and agricultural products to France, as well as
the largest export market for French agricultural products. According
to French Customs, the value of French agricultural exports (including
spirits, manufactured tobacco, and wood and products) to the U.S. in
1994 was $ 1,229 million, while the value of French agricultural imports
(including spirits, manufactured tobacco and wood and products) from the
U.S. during the same period was $ 881 million, leading to a positive
agricultural trade surplus for France with the U.S. of $ 348 million.
E. Trade Barriers
U.S. companies sometimes complain of France's complex technical
standards and of unduly long testing procedures. Testing requirements
(which must usually be done in France) and standards sometimes appear to
exceed reasonable requirement levels needed to assure proper performance
and safety. Most of the complaints have involved electronics,
telecommunications equipment and agriculture phytosanitary standards.
The 1989 EU Broadcast Directive requiring a "majority proportion" of
programming to be of European origin was incorporated into French
legislation on January 21, 1992. France, however, specifies a
percentage of European programming (60 percent) and French programming
(40 percent). These broadcast quotas were approved by the EU Commission
and became effective on July 1, 1992. They are less stringent than
France's previous quota provisions which required that 60 percent of all
broadcasts be of EU origin and that 50 percent be originally produced in
French. The 60 percent European/40 percent French quotas are applicable
throughout the day, as well as during prime time slots. The prime time
rules go beyond the requirements of the EU Broadcast Directive and limit
the access of U.S. programs to the French market. Nevertheless, the
market share of U.S. films and television shows remains high. Despite a
recent push for tighter television quotas, the situation has not changed
much since 1992. In June 1995, France shelved its demand for more
restrictive quotas for the time being. Instead, the latest campaign is
for new financial and other subsidies for film and television program
makers.
The French government has recently revised its legal services system.
Non-EClawyers may no longer practice as legal consultants and are
required to qualify as "avocats," on the basis of full-fledged
membership in the French bar. Under the implementing legislation which
went into effect on January 29, 1993, this means that non-EU lawyers
will have to pass either a "short-form" exam or the full French bar
exam. The French government has accepted that the General Agreement on
Trade in Services (GATS) precludes reciprocity requirements which should
allow non-EU lawyers to qualify for the short-form exam. There are
other aspects of the process, however, which could disadvantage foreign
candidates unfairly. For example, the arbitrary choice of subject
areas makes studying for the test extremely difficult, and examiners
have considerable discretion on deciding whether a candidate passes or
fails. Due to EU regulations, France is required to recognize law
degrees for EU nationals but not third country nationals. Nevertheless,
non-French EU lawyers, who are also required to qualify as "avocats,"
may do so via exams less stringent than those for non-EU lawyers.
Meaningful access will now hinge on how implementing regulations are
administered, including the interpretation of what is meant by granting
access on a "reciprocal basis" and the nature of the exam to be imposed
on non-EU lawyers.
F. Investment Barriers
Screening
See section VII, Investment Climate.
Privatization
The 1993 privatization law prevents the French government from selling
more than 20 percent of a firm's capital to non-EU investors at the time
the government sells its shares. Thereafter, however, the provision
does not prohibit private EU-investors from selling their shares to non-
EU investors. Shares already held by non-EU investors are not affected
by the 20 percent limit. In addition, through "golden shares" in key
companies, the government retains the right to block the sale of any
assets "essential to the national interest," to prevent certain
investors from purchasing additional shares in a company, and to exert
significant control over company management, even after privatization is
completed. Finally, any investor seeking to own more than five percent
of outstanding shares of a privatized company in the health, security or
defense sectors must receive approval from the Economics Ministry.
In October 1993, the Balladur government announced 21 companies would be
privatized. The Juppe government is committed to continuing this
privatization campaign. Of the 21 major enterprises included in the
program, 7 companies have been privatized - Usinor Sacilor, Elf
Aquitaine, Banque Nationale de Paris, Rhone-Poulenc, Seita, and
Compagnie General Maritime. Two additional companies, Bull and Renault,
have seen their French government share reduced. Part one of a three
part privatization of Bull is complete. In early 1995, the French
government reduced its share in Renault to 51%.
Sectoral Investment Restrictions
The recent announcement by Finance Minister Alain Madelin that France
will ease the ownership rules for foreigners means that the list of
areas where foreigners have to seek government approval will be the same
as for foreign investors from other EU countries. Under EU rules,
foreigners can be prevented from taking full control of companies deemed
essential to national defense, public safety, health or security.
Firms controlled by non-EU nationals could heretofore be denied national
treatment in the following sectors: agriculture, financial services,
accounting, legal services, air transport, maritime transport, road
transport, publishing, telecommunications, defense and tourism.
G. Labor Force
The French labor force is one of the country's strongest points in
attracting foreign investment, combining high quality with competitive
unit wage costs. In a recent survey of U.S. investors in France,
management was unanimous in agreeing that the quality of local personnel
was adequate and 90 percent found labor costs to be competitive.
The Labor Code sets out minimum standards for working conditions
including the work week, overtime, vacation and personal leave. Other
labor standards are contained in collective agreements, which are
usually negotiated on a national or regional basis by the various unions
and employers' associations. The French minimum hourly wage is FRF
36.22 (approx. $7.3). The legal work week is 39 hours and average time
worked hovers around this figure. When the work week exceeds 39 hours,
non-executive employees are entitled to overtime payment and/or
compensatory time off. Employees are entitled to 2.5 workdays of
vacation per full month worked.
The average private sector compensation per employee increased by 1.2
percent in 1994, which meant that the real labor cost fell, as the
inflation rate was 1.7 percent in 1994.
French absenteeism is relatively modest by European standards while the
hours lost to strikes is at an all-time post World War II low. Despite
highly visible nuisance strikes in the public sector, relatively
peaceful labor relations have been the order of the day, particularly in
the private sector.
H. Major Third Country Competitors
As the world's fourth largest economy, centrally located within the
European Union, there is strong competition for market share in all
French industry sectors. Major French organizations, e.g. Aerospatiale,
Alcatel, Michelin, and Thompson, have manufacturing and marketing
expertise which matches major U.S. multinationals. The government of
France is also a major competitor and has an industrial policy which
considers the development of certain domestic industries as critical to
national security. At the beginning of 1993, 70 state-owned enterprises
accounted for approximately 30 percent of French GDP. This situation is
gradually changing in light of the current government's efforts to
privatize many of these state-owned industries; however, the government
still plays a far more interventionist role in industrial affairs than
is the case in many other industrialized nations.
American exporters to France face more competition from European
countries than Asian; however, the Japanese have been successful in
developing a foothold in the French market, with substantial investments
in the Alsace region. German manufacturers are the most serious
competitors in Europe, relying on the many Franco-German joint ventures
that have been established. Each industry has its own principal
competitors and should be carefully analyzed before beginning an effort
to capture a share of the French market.
I. Infrastructure Situation
The French transportation infrastructure is among the most sophisticated
in the world, benefiting from technological advances such as the Train à
Grande Vitesse (TGV) and from extraordinary investment by the
government. The three main entry points for air freight are the Paris
airports of Orly and Charles de Gaul, and Lyon's Satolas airport.
France has 12 major maritime ports, many of which are equipped for
container ships. The state-owned French rail system is one of the most
comprehensive and technologically advanced in the world. For example
the Roissy Charles de Gaul Airport began an intermodal link in 1995 with
the north TGV line for passenger traffic.
The French highway system is excellent and has become an increasingly
important part of Europe's overall transportation network. France
currently invests more funds in its highway and road network than any
other European country. In 1995, the government inaugurated the longest
spanned bridge in the world, Le Pont de Normandie, linking Le Havre with
Honfleur over the Seine.
J. Major Infrastructure Projects Underway in France
1. Transportation Projects
-- Roissy/Charles de Gaul Airport Expansion
2. Defense Trade
a. Nuclear Aircraft
b. MEADS (Medium Extended Air Defense System)
c. Horizon Frigate Propulsion System
3. Construction Projects
a. "La Tour Sans Fin" - La Defense
b. Cite Internationale de Lyon
c. Georges Pompadour European Hospital
d. St. Denis Stadium
e. Europort-Vatry
4. Environmental and Urban Development Project
-- Eco-Normandie Regional Technological Park
CHAPTER III. POLITICAL ENVIRONMENT
A. Bilateral Relationship
France and the U.S. are close allies. Despite occasional differences of
view, the U.S. and France work together on a broad range of trade,
security and geopolitical issues.
B. Political System
France is a democratic republic whose political system is based on a
written constitution approved by referendum in 1958. According to the
French Constitution, the President of the Republic is elected by direct
suffrage every seven years. The President names the Prime Minister,
presides over the cabinet, commands the armed forces and concludes
treaties. He is also empowered to dissolve the National Assembly and,
in certain emergency situations, may assume full power. France's
political system is a hybrid of presidential and parliamentary systems,
resulting occasionally in the President and Prime Minister being of
opposing parties. Since March 1993, for example, the Socialist
President has had a Prime Minister from the conservative party.
The Constitution provides for a bicameral parliament consisting of a
National Assembly and a Senate. National Assembly deputies are directly
elected by universal suffrage for five-year terms. Senators are
indirectly elected for nine-year terms; one-third of the Senate is
renewed every three years.
The French political spectrum includes five distinct political groups.
From right to left, these are: the extreme right National Front (FN);
the neo-Gaullist Rally for the Republic (RPR); the moderate Union for
French Democracy (UDF); the Socialist Party (PS); and the Communists
(PCF). Numerous smaller parties have variable national political
impact.
C. Political Events Affecting Business Climate
Gaullist RPR President Jacques Chirac took office as French President in
May 1995. He replaces socialist Francois Mitterrand, who held France's
top office for 14 years. Chirac is under great pressure to reduce
France's more than eleven percent unemployment rate, and his government
hopes to create more than one million new jobs between 1995 and 1998.
Chirac will also continue the pace of privatization. He may, however,
come under pressure from his electorate to adopt more protectionist
trade pressures.
CHAPTER IV. MARKETING U.S. PRODUCTS AND SERVICES
The United States and France produce many of the same goods and services
and export them to each other. Therefore, marketing products and
services in France is much like marketing in the U.S., with several
significant differences. Following is a general overview of marketing
in France. Specific counseling sessions with United States Department
of Agriculture/Foreign Agriculture Service & Commercial Service trade
specialists are recommended for those wishing more details as they plan
their specific marketing campaigns in France.
A. Distribution & Sales Channels
The Retail Network
France possesses a diverse and comprehensive retail network which
increasingly resembles that of the United States. From the largest
department store chains to the smallest individual proprietorships,
French distribution channels are exhibiting several important trends.
Small- and medium-sized family-owned firms, which traditionally
accounted for a majority of French wholesale and retail trade, are
rapidly losing ground to hypermarkets - large retail outlets carrying a
wide variety of products at discounted prices. At the same time, mail
order marketing and specialized chain stores have shown strong growth,
further demonstrating the changing needs and preferences of consumers.
Primary Retail Channels:
• Grands magazines - Department Stores
• Hypermarches - Hypermarkets
• Supermarches - Supermarkets
• Magasins populaires - Convenience Stores
• Vente par catalogue - Mail-order Marketing
• Grandes surfaces specialisees - Large Specialized Stores
• Multi-Channel Retail Groups
• Centrales d'achats - Central Buying Offices
Department Stores: In 1994, there were some 218 department stores,
employing 46,000 people and totaling $4.5 billion in sales. Paris has
the highest number of department stores of any French city, and nine of
the ten top-selling stores are located there. Department stores have
lost some market share in all areas except in the medium-to-high price
range. A unique feature of the French department store is that many
non-food products are sold by the manufacturer's own sales staff, which
can account for up to 20 percent of the store's total sales force.
Hypermarkets: Hypermarkets are self-service retail stores carrying
20,000-35,000 food articles and 3,000-5,000 non-food articles at
competitive prices. They are generally located in suburbs, and cover at
least 22,500 square feet each. In 1994, there were 945 hypermarkets,
employing 196,000 people. They generated a total of $66.3 billion in
sales.
Supermarkets: Also self-service retail stores, supermarkets are smaller
versions of hypermarkets. They usually carry 3,500-4,500 food articles
and 500-1,500 non-food articles. They generally cover 3,600-22,500
square feet. In 1994 there were 7,138 supermarkets, employing 170,000
people. They generated a total of $61.4 billion in sales.
Convenience Stores: Convenience stores are generally self-service and
carry a varied assortment (7,000-10,000) of food and non-food articles.
In 1994, there were 483 convenience stores, employing close to 21,400.
They generated a total of $3.6 billion in sales.
Mail Order Marketing: The French market for mail-order consumer
products is the fourth largest in the world. This market has tripled in
the last ten years, reaching $9.4 billion in 1994. One out of two
French households buys through mail order. Textile products make up
46.1 percent of mail-order sales, books and records 13.8 percent, and
furniture and home decoration 10.7 percent.
Large Specialized Stores: Large specialized stores offer an extensive
choice of goods in a specific category at a competitive price and with
an emphasis on customer service. With over 10,000 stores of this type,
this dynamic sector generates $18 billion in sales and represents 56.3
percent of non-food retail sales. Furniture stores are the most
numerous (2,500), followed by do-it-yourself equipment stores (1,500).
Multi-Channel Retail Groups: The distinctions made above between
hypermarket chains, supermarket chains, etc. are becoming blurred. In
the last several years, major multi-channel retail groups have emerged,
which own chains of different types of stores. Pinault-Printemps and
Nouvelles Galleries Reunies fall into this category, because they own
chains of specialty and convenience stores.
Central Buying Offices: In addition to contacting the largest store
chains listed above, introducing products via central buying agencies is
an excellent distribution method. A complete list of French central
buying agencies, the Annuaire des Supermarches, Hypermarches, Centrales
d'Achat et Groupements d'Achats, is available at about $130 (freight
included) from:
m L.S.A
Mrs. Majean
B.P. 142
92304 Levallois Perret cedex, France
Tel: (33-1) 47 58 20 00
Fax: (33-1) 47 59 07 64
Distribution Systems for Food Products in France
France has one of the most highly developed distribution systems for
agricultural and food products in the world. There is an extensive
network of transportation and distribution channels that assure
consumers will receive the final product in good quality and at the
proper time.
Normally, French imports of agricultural and food products are brought
in from the west Atlantic via the northern French port of Le Havre, or
via the ports of Antwerp and Rotterdam in the Netherlands. Imports from
the Mediterranean and African countries come through the southern port
of Marseilles. Imports from other EU and European countries are often
brought in by trucks through the world's largest wholesale food market
at Rungis, which is located south of Paris. Since much of the processed
food products in France are of domestic origin, there are well developed
regional markets throughout the country.
Despite the fact that France has a very modern and relatively efficient
distribution and transport system, frequent disruptions occur in product
movement, due to unexpected strikes by port dockers or truck drivers, or
some other labor disputes. Fortunately, the availability of alternative
entry ports minimizes the magnitude of this problem for U.S. exporters.
Wholesale Distribution
There are about 27,000 wholesalers of food and agricultural products
(including raw products) in France. The industry continues to
consolidate and diversify with individual firms adding new services to
their basic wholesale activities. Wholesalers now offer a whole
"platform" of services for small and medium-size food retailers and
processors. Despite consolidation, many traditional French wholesale
food companies continue to lose ground to large super and hypermarket
chains, and most recently to the "hard discounts" who are increasingly
expanding their own wholesale activities with "private labels".
Retail Food Distribution Channels
There are six principal categories of retail food outlets in France.
The first five (hard-discounts, hypermarkets, supermarkets, city-center
stores and department stores) represent the mass market and control
about 56 percent of total food distribution. The sixth category,
traditional outlets, includes neighborhood stores and specialized food
stores.
It is expected that mass market outlets will control 75 percent of the
market by the year 2000. As of January 1, 1995, there were almost 8,083
super and hypermarkets in France. Hard-discounts have a total of 1,545
stores all over France and represent 8.4 percent of food sales in France
in volume. It is expected that hard-discounts sales may reach $15
billion within five years, and the next few years are expected to see a
contest between the full-range super/hypermarkets concept and the
greater savings cooperative/hard-discounts concept.
Restaurants, Hotels and Food Institutions
Last year, French consumers eat 5.8 billion meals valued at almost $28
billion outside of the home in 131,000 restaurants, cafes, cafeterias
and university dining halls. This represents about 13 percent of all
meals consumed in the country. Out-of-home food is growing at the low
rate of one percent a year. Almost 40 percent of out-of-home meals are
consumed at commercial facilities (restaurants, hotels, fast food,
etc.), while 60 percent are consumed at schools, hospitals or
workplaces. French restaurants, hotels and institutions usually use the
services of wholesalers or processed food buyers. In these cases, the
well developed distribution channels of the wholesalers/importers are
often the key to getting a new food product into that sector.
B. Use of Agents and Distributors
Considering the host of distribution options available in France, it is
important for the would-be exporter to select the method best suited to
his or her product. French buyers generally prefer to purchase through
an intermediary, making sales directly to the end-user a scarce
practice. However, sales of expensive, technically sophisticated goods
are an exception to this rule.
Intermediaries may take one of three primary forms under French law:
• Distributor
• Agent
• Salaried Representative
Distributor
A distributor (concessionaire) is an individual or legal entity who
purchases goods directly from a producer for the purpose of resale. The
distributor operates independently and is only bound by the written
provisions of the distribution agreement. These agreements, however,
are subject to specific rules and regulations regarding exclusive
distribution and price-fixing.
The conditions of contract termination are an important concern, and
vary with the type of distribution agreement. A distribution agreement
of specified duration may be terminated at the end of the contract
period by either party without prior notification or indemnification.
If the termination takes place before the end of the contract period,
the terminating party may be sued for breach of contract.
A distribution agreement with an unspecified duration may be terminated
by either party without indemnification after a fair notice period,
usually six months. The termination of such a contract by the producer
without fair notice may be grounds for damage claims by the distributor.
Agent
This category covers commercial agents as well as those persons acting
as agents but not fulfilling the requisites for commercial agent status.
Unlike distributors, agents do not actually purchase goods for resale;
instead, they match up buyers and sellers on a commission basis. All
agents exercise their activities in an independent manner, and their
principals are exempt from payment of payroll taxes. Agents assume
their own fiscal charges (business license tax and value-added tax) and
social charges (health insurance, social security and retirement/pension
benefits).
Commercial Agent: Agents with a written contract have the status of
commercial agents (agents commerciaux) if they exercise their activity
as a sustained independent profession and fulfill the following
conditions:
-- do not have a written employment contract;
-- negotiate sales and purchases on behalf of producers, manufacturers,
or dealers;
-- are registered with the Tribunal of Commerce as commercial agents.
A commercial agent is independent and free to act on the behalf of any
other firm. However, in the case where the agent wishes to represent
one of his or her principal's competitors, consent of the principal must
first be secured.
The principal may justifiably terminate the commercial agent contract
only if the agent shows substantial deficiency in carrying out his or
her obligations. Otherwise, contract termination gives the agent a
right to indemnification, often equal to two years' commission.
Other agents: Persons who do not fulfill all the requirements for
commercial agency, and who are not in a position of subordination to the
company they represent, are considered agents. Authorization of an
agent can be effected by notarial act or private agreement. Either
party may terminate the agency agreement at will, but the non-
terminating party has a right to indemnification of losses.
Salaried Representatives
Unlike agents, salaried representatives have employment contracts. They
and their employers share the burden of payroll taxes contributing to
social security, unemployment compensation, and retirement/pension
plans.
Statutory Representatives: Whatever their qualifications or title,
persons are considered statutory representatives if they exercise their
activity as a sustained independent profession and fulfill the following
conditions:
-- engage in the activity of a sales representative for the account of
one or more employers;
-- desist from executing commercial operations on their own behalf;
-- institute mutual commitments with employers regarding the nature of:
the goods or services offered for sale, the region of activity or the
category of clients, and the rate of compensation.
Statutory representatives, like all employees, perform their work
according to the instructions of their employers and benefit from the
system of labor law protection. However, they possess a special right
to indemnification if their employment is unjustly terminated. This
indemnity is based on the size and importance of the clientele created
by the statutory representative.
Nonstatutory Salaried Representatives:
Representatives who are subordinate to their employers and who do not
fulfill the requisites for statutory representative status fall into a
separate category and are considered regular employees.
Finding a Partner
The Department of Commerce's International Trade Administration offers
several services to help the would-be exporter identify potential
foreign representatives. The three primary services available from the
Commercial Service in France are the Gold Key Service, the Agent
Distributor Service (ADS) and Industry Targeted Mailings. To request
any one of these services, firms should contact the nearest U.S.
Department of Commerce District Office.
Contacting and Evaluating Potential Representatives
Once the U.S. company has identified several potential representatives,
it should contact them directly in writing. Just as the U.S. firm is
seeking information on the French representative, the representative is
interested in corporate and product information on the U.S. firm. The
U.S. firm should provide full information on its history, resources,
personnel, the product line, previous export activity, and all other
pertinent matters.
At the same time the firm is providing information on itself, it should
also engage in a thorough investigation of the potential representative.
Following is a list of important facts the firm should endeavor to find
out:
-- Current status and history, including background on principal
officers
-- Personnel and other resources
-- Sales territory covered
-- Current sales volume
-- Typical customer profiles
-- Methods of introducing new products into the sales territory
-- Names and nature of U.S. firms currently represented
-- Trade and bank references
-- Assessment of whether U.S. firm's special requirement can be met
-- View of in-country market potential for the U.S. firms products
The U.S. firm should not hesitate to ask potential representatives or
distributors detailed questions; exporters have the right to explore the
qualifications of those who propose to represent them overseas.
In addition, the U.S. firm is advised to obtain at least two supporting
business and credit reports to ensure that the distributor or
representative is reputable.
The French agency of Dun & Bradstreet offers this service.
Dun & Bradstreet France
Service Renseignements de Notoriete
Immeuble Defense Bergeres
345, av. G. Clemenceau
TSA 590003
92882 Nanterre
Tel: (33-1) 41 35 18 98
Fax: (33-1) 41 35 19 20
Negotiating an Agreement with a French Representative
Once the U.S. firm has selected a prospective representative, the next
step is to negotiate a foreign sales agreement. The content of this
agreement is extremely important, as it will determine the legal basis
for any relationship between the exporter and the representative.
Although U.S. Department of Commerce District Offices can provide
counseling to firms planning to negotiate agreements with French
representatives, engaging a French lawyer is strongly advised.
In drafting the agreement, special attention must be paid to
safeguarding the exporter's interests in cases in which the
representative proves less than satisfactory. Procedures and conditions
for terminating the relationship should be clearly defined.
Furthermore, any right to indemnification on the part of the exporter or
distributor should be specified.
C. Franchising
France is the strongest market for U.S. franchise development within the
EU. Out of a total of 34 foreign franchises in France, 18 are American,
accounting for 4.2 percent of the total franchise market. The market
size in 1994 was $38 billion. The estimated annual growth rate for 1995-
1997 is 10 percent. U.S. exports reached $9.2 billion in 1994; the
estimated average annual growth rate for U.S.-owned firms is 12 percent.
The franchising industry has stayed strong despite unfavorable economic
conditions. Fast-food has been the most successful sector, but is now
very competitive. The greatest potential for U.S. franchisors lies in
sub-sectors yet to be fully exploited, such as computer education and
renovation services.
D. Direct Marketing
Direct Marketing in France is a fast growing industry with sales
evaluated at $6.7 billion in 1993. This figure includes expenses for
all Direct Marketing media: mailings, catalogs, telephone marketing,
targeted and non-targeted fliers, press and television.
The market is expected to grow at the rate of 4.5 percent per year.
Some media have experienced tremendous growth in volume and in value
over the past 10 years. For example, non-targeted fliers have increased
in volume by 16 percent in 1993, while targeted fliers or catalogs only
increased by 2 percent. However, catalog sales remain a good
opportunity for U.S. companies. The French market for mail order
consumer products reached $9.4 billion in 1994. Catalog sales represent
80 percent of this market. U.S. companies rank second after Germany in
mail order sales in France with $245 million in sales. The best
prospects in this sector remain apparel, followed by books and records
as well as entertainment videos.
E. Approaches to the French Market
American companies have prospered in the French market and will continue
to do so if special attention is paid to their approach to the market
and the products/services they offer. As outlined above, the best "first
step" is to appoint an agent or distributor; however, expansion in the
market can take various other forms, depending on the product/service.
Joint Venture/Licensing
A joint venture with a French firm having similar commercial interests
is one recommended approach. The French government encourages this type
of investment and offers a wide range of incentives. In selecting a
joint venture partner, the American company must carefully analyze its
strengths and weaknesses and search for a firm that offers the
appropriate support. Traditionally, a French joint venture partner
strengthens the marketing activities of an American firm with its in-
place distribution system. In certain industries, French manufacturers
have skills that augment those of the American partner. Financing is
also of special concern. Each joint venture proposal requires special
analysis and conditions if it is to be successful. A joint venture with
a French firm that has full French government support can be beneficial
as long as manufacturing decisions can be made independently of
government involvement. Recognizing the differences in each market is
essential for success; consequently, it is recommended that companies
interested in forming joint ventures consult with the Embassy in Paris
before making any entangling alliances.
Steps to Establishing an Office
Establishing a subsidiary/branch office in France is also an advisable
approach for some industries. The French government encourages the
formation of new enterprises and, in conjunction with the Paris Chamber
of Commerce and other Chambers throughout the country, offers extensive
counseling and assistance to those wishing to set up an office in
France. Detailed "how to" guides are available not only from the various
chambers of commerce, but also from the Commercial Service and the
numerous American consulting firms present in France.
F. Selling Factors/Techniques
Selling your product or service in France is similar to the United
States. Buying decisions are made on the basis of quality, price and
after-sales service. The principal difference in France is, in fact, the
language. Since August 1994, the "Loi Toubon" requires that all
advertising, labeling, instructions and promotional programs be in
French. Consequently, we strongly recommend close contact with the
Commercial and Agricultural sections in the Embassy and arranging for
local legal representation.
Advertising and Trade Promotion
There are far too many newspapers, magazines and technical journals to
list; however, judicious use of the media is an important part of any
and all promotional programs. Below is a list of the most prominent
French newspapers and magazines:
Le Figaro
37, rue du Louvre
75081 Paris Cedex 02 France
Tel: (33-1) 42 21 62 00
Fax: (33-1) 42 21 64 05
President Director General (P.D.G.): Robert Hersant
Director de la redaction : Franz-Olivier Giesbert
Le Monde
15, rue Falguiere
75501 Paris Cedex 15 France
Tel: (33-1) 40 65 25 25
Fax: (33-1) 40 65 25 99
Director General: Jean Marie Colombani
Secretaire General: Alain Fourment
L'Express
61, avenue Hoche
75411 Paris Cedex 08 France
Tel: (33-1) 40 54 30 00
Fax: (33-1) 40 54 99 72
P.D.G.: Francoise Sampermans
Directrice de la redaction : Christine Ockrent
Liberation
11, rue Beranger
75154 Paris Cedex 03 France
Tel: (33-1) 42 76 17 89
Fax: (33-1) 42 72 94 93
P.D.G. : Serge July
Director de la publication: Serge July
France Soir
37 rue du Louvre
75002 Paris France
Tel: (33-1) 44 82 87 00
Fax: (33-1) 44 82 88 45
P.D.G.: Robert Hersant
Director de la redaction : Robert Hersant
Le Parisien
25, avenue Michelet
93400 Saint-Ouen France
Tel: (33-1) 40 10 30 30
Fax: (33-1) 40 12 90 90
P.D.G.: Philippe Amaury
Director General: Fabrice Nora
International Herald Tribune
181, avenue Charles de Gaul
92200 Neuilly Sur Seine France
Tel: (33-1) 41 43 93 00
Fax: (33-1) 41 43 93 38
Publisher: Richard McLean
Vice President: John Vinocur
Le Nouvel Observateur
8, rue Aboukir
75002 Paris France
Tel: (33-1) 44 88 34 34
Fax: (33-1) 44 88 34 28
P.D.G.: Claude Perdriel
Director de la redaction: Jean Daniel
Le Point
140, rue de Rennes
75006 Paris France
Tel: (33-1) 49 54 10 10
Fax: (33-1) 45 49 30 20
P.D.G.: Bernard Wouts
Director de la redaction: Denis Jeambar
Les "Echos"
46, rue la Boetie
75381 Paris Cedex 08 France
Tel: (33-1) 49 53 65 65
Fax: (33-1) 45 61 48 92
P.D.G.: Eric Noblet
Dir. Gen. de la redaction: Nicolas Beytout
L'Expansion and La Vie Francaise
Groupe Expansion
25, rue Leblanc
75842 Paris Cedex 15 France
Tel: (33-1) 40 60 40 60
Fax: (33-1) 40 60 41 22
President: Christian Bregou
Dir. Gen. de la redaction: Jacques Barraux
La Tribune Desfosses
Cote-Desfosses
42-46, rue Notre Dame des Victoires
75002 Paris France
Tel: (33-1) 44 82 16 16
Fax: (33-1) 44 82 17 16
P.D.G.: Pierre-Antoine Gailly
Dir. Gen.de la redaction : Jacques Jublin
Le Nouvel Economiste
10 rue Guynemer
92130 Issy les Moulineaux France
Tel: (33-1) 41 09 30 00
Fax: (33-1) 41 09 30 98
P.D.G.: Philippe Berthin
Director de la redaction: Vincent Beaufils
G. Pricing Product
The U.S. exporter can usually determine the export price of his/her
manufactured product using 70% of the domestic price (after deduction of
all local marketing costs). This will allow the French importer to
price his imports from the U.S. on the same price level as his American
counterpart. A simple way of comparing U.S. and French retail prices
consists of taking the net U.S. retail price and comparing it with the
French retail price without Value Added Tax (V.A.T.) currently 18.6%.
French V.A.T. will increase to 20.6% on August 10, 1995. The French
consumer is generally willing to pay a maximum of 10-15% over the
American retail price.
When determining the export price, it is important to consider that if
prices are FOB, the French importer will have to pay for transportation,
insurance, customs duties, value-added tax and fixed fees per shipment.
Terms of Payment
For U.S. exporters, what is called "the financing of export sales" is
not basically different from financing domestic sales. The fundamental
concern in both cases is that one is paid in a timely manner for the
goods and/or services delivered.
France's modern banking system offers a full range of payment means, the
most significant of which are:
-- commercial letters of credit
-- sight and time drafts
-- bank transfers
-- certified checks
Although bank transfers and certified checks are fairly self-explanatory
methods of payment, commercial letters of credit and sight and time
drafts may be less familiar to the would-be exporter but are potentially
attractive terms of payment.
H. Sales service/Customer support
Although less developed than in the U.S., French businesses also provide
all kinds of services such as after sale service, home delivery,
maintenance contracts, warehousing facilities, hot lines or toll free
numbers for any technical assistance.
For some products such as electrical appliances, e.g. T.V., replacement
service is available.
I. Selling to the Government
The French Government generally pursues procurement policies in
accordance with EU regulations, which call for non-discrimination vis-a-
vis foreign firms. In France, procurement regulations do not usually
present barriers to entry for foreign firms. However, local political
pressure and administrative procedures often said to favor French
companies.
French Government procurement comes under the jurisdiction of Ministry
of Economy and Finance. The "Commission Centrale des Marches" (CCM), or
Central Procurement Board, has overall responsibility for monitoring
compliance with procurement regulations.
France, as a member of the EU, is obliged to follow EU public works
regulations which require government purchasing entities to publish
tender notices for all public works projects valued at over 5 million
ecus, or approximately $5.75 million. Tender notices that exceed this
threshold must be published in the Official Journal of the European
Union, as well as in the French Bulletin Officiel des Annonces des
Marches Publics. In the case of telecommunications, transportation and
water utilities, however, a European Community Utilities Directive
(January 1, 1993) requires France to give EU bidders a three percent
price preference and gives France the option to reject bids with more
than 50 percent non-EU content. This same preference has been waived
for U.S. content with respect to electrical utilities as the result of
U.S. - EU agreements on procurements. Certain defense-related
industries are also excluded from regular procurement rules. In
addition, public projects must conform to the following requirements:
-- a minimum of 52 days is required for bid submissions after an offer
is announced.
-- the reason for a bid's rejection must be provided upon request.
-- the values of the winning bids must be publicly disclosed.
For information on French Government procurement regulations and
procedures, contact:
CCM
Tour de Lyon
139, rue de Bercy
75012 Paris, France
Tel: (33-1) 44 87 17 17
Fax: (33-1) 53 17 87 04
Information on current and past French and EU procurement tenders and
bids may be obtained through France's MINITEL service, an on-line
information bank. This service offers up-to-date information and
immediate access.
MINITEL Services Company
888 Seventh Avenue, 28th Floor
New York, NY 10106
Tel: (212) 399-0080
Fax: (212) 399-0129
Access to procurement tenders and bids may also be obtained by
subscribing to the Official Journal of the European Union (OJEU), or the
Bulletin Officiel des Annonces des Marches Publics (BOAMP). However,
these publications often do not arrive from overseas in a timely manner.
OJEU can be ordered from:
UNIPUB
4611F Assembly Drive
Lanham, MD 20706-4391
Tel: (800) 274-4888
Fax: (301) 459-0056
For subscriptions to BOAMP, contact:
BOAMP
Direction des Journaux Officiels
26, rue Desaix, France
75727 Paris Cedex 15, France
Tel: (33-1) 40-58-77-58
or (33-1) 40-58-75-00
J. Protecting your Product from IPR Infringement
Intellectual property consists of industrial property as well as
literary/artistic property. Under the French intellectual property
rights regime, industrial property is protected by patents, trademarks,
and designs and models, while literary/artistic property is protected by
copyrights.
By virtue of the Paris Convention and the Washington Treaty regarding
industrial property, U.S. nationals are entitled to receive the same
protection of industrial property rights in France as French nationals.
In addition, U.S. nationals have a "right of priority period" after
filing a U.S. patent, trademark, design or model, in which to file a
corresponding application in France. This period is twelve months for
patents and six months for trademarks, designs and models.
Patents
There are three types of patents: patents of invention (Brevets
d'Invention), patents of addition (Brevets d'Addition), and certificates
of utility (Certificats d'Utilite). Patents of invention cover all
inventions, whereas patents of addition cover supplements to those
inventions. Certificates of utility cover all inventions except those
of a pharmaceutical nature.
In order to qualify for patent protection, the invention must:
* Have an industrial or agricultural application
* Imply a non-obvious procedure, and
* Have absolute novelty.
Duration: Patents for inventions have a twenty-year life span, after
which they become part of the public domain. Patents of addition are
only valid for the unexpired term of their parent patents. Certificates
of utility have a six-year, non-renewable life span.
Patent Registration: Applications for patent registration must be filed
with the French National Institute for Industrial Property, the Institut
National de la Propriete Industrielle (INPI), before the invention is
publicly disclosed. INPI receives applications, examines their
validity, and registers the patents. After the application for a patent
is filed, INPI conducts a check for comparable inventions. Upon
approval and registration, a patented invention may be manufactured,
operated, used or sold only with the authorization of the patent's
owner. The owner can transfer, or sell the patent, or grant a license
for others to use it. A patent must be used to be retained. Applicants
can consult INPI's library to check for the existence of similar
inventions prior to filing.
INPI
Division des Brevets
26 bis, rue de Saint-Petersbourg
75800 Paris Cedex 08, France
Tel: (33-1) 42 94 52 52
Fax: (33-1) 42 93 59 30
Patent protection in France may also be obtained through ownership of a
European Patent, which is filed through the European Patent office in
Munich:
Office European des Brevets
Erhardtstrasse 27
8000 Munich 2, Germany
Tel: (49) 89 23 990
Fax: (49) 89 99 4465
Patent registration in France requires a French address, which may be
obtained through a legal representative in France. A list of patent
advisors who can act as legal representatives can be obtained from the
French Association of Patent Advisors, Compagnie Nationale des Conseils
en Propriete Industrielle:
CNCPI
21, rue de Saint-Petersbourg
75800 Paris Cedex 08 France
Tel: (33-1) 45 22 55 11
Fax: (33-1) 40 08 07 97
Certificate of Utility Registration:
Certificates of Utility are also granted by INPI (see above). However,
in this case, INPI does not conduct a check for comparable inventions.
Fees:
* Patents for Inventions
- Application fee: $50, which includes the first year of annual
renewal fees.
- Documentation and research fee: $900. This amount is to be paid
at the latest one month after the application.
- The annual renewal fee is calculated each year on a sliding
scale.
* Patents for Additions
- Registration fee: $500
* Certificates of Utility
- Registration fee: $50
- Annual renewal fees are calculated on a sliding scale.
Trademarks
Trademark protection can apply to both goods and services. In a general
sense, trademarks recognize and protect indicators which serve to
distinguish one product or service from similar products or services.
In the French regime, trademarks:
* Can be written or designed trademarks.
* Can be sonorous trademarks, such as musical tunes, jingles,
words, slogans.
* Must not be deceptive as to the nature or origin of the goods.
* Must be recognizable by sight or sound.
* Must have novelty for the specified product line.
Duration: A trademark has a ten-year life span and is renewable every
ten years.
Trademark Registration: Applications must be filed with INPI, which
receives applications, examines their validity, and registers
trademarks. After registering the trademark, it must be publicly and
unequivocally exploited for five consecutive years, or all trademark
rights are forfeited. It may be sold totally or partially, by product
or service category.
INPI
Division des Marques
32, rue des Trois-Fontanot
92016 Nanterre, France
Tel: (33-1) 46 92 58 00
Fax: (33-1) 49 01 07 37
Registration of trademarks, as in the case of patents, requires a French
address, which may be obtained through a legal representative in France.
A list of trademark advisors who can act as legal representatives can be
obtained from CNCPI, whose address is listed above.
Fees:
* Application fee (first registration or renewal): $240 for up to
three product/service categories; $50 for each additional category
protected.
For designs and models specifically:
* For the first photographic reproduction: $50.
* For each additional reproduction up to the 100th: $30.
Designs and Models
Designs and models have the following characteristics:
* Designs are an assembly of traits or colors on the surface of an
object. They constitute an original two additional decoration.
* Models are all creations (ornaments).
* They must have absolute novelty.
Although some designs and models can be protected under patent or
copyright procedures, others fall into a category which requires special
treatment. Designs or models having an industrial function follow
patent procedures, while designs or models having a purely ornamental
function follow copyright procedures. Those designs or models which
have both a practical and an ornamental function are subject to the
following:
Duration: Infringement protection has a 25 year life span, and is
renewable for another 25 years.
Registration: Exclusive proprietary rights to the design or model are
acquired through the act of creation itself. Registration merely serves
as proof of that creation. Designs and models are to be registered with
the INPI:
INPI-Designs and Models Section
26 bis rue de Saint Petersbourg
75008 Paris, France
Tel: (33-1) 42 94 52 52
Fax: (33-1) 42 93 59 30
To prove the date of creation of a design or model without formal
registration, a designer may wish to use a special envelope (envelope
speciale) for a $11 fee. The date of creation begins when the envelope
is received by the INPI.
Copyrights
Copyrights cover artistic works, literary works and software. In the
French IPR regime, in order to qualify for a copyright, the language
used to express the idea must be original, not the idea itself.
Duration: Copyrights are valid for 50 years after the death of the
author, with two major exceptions: music copyrights are valid for
seventy years after the death of the composer, and software copyrights
are valid for 25 years after creation. Contrary to other copyrights,
software designed by a salaried employee belongs to the employer.
Registration: Artistic and literary works are automatically protected
once created and fixed in tangible form. Therefore, registration is not
required, but nonetheless recommended.
For musical works, including songs, instruments, poems, sketches under
20 minutes, monologues, and other musical audiovisual productions,
applications must be filed with the French Society for Musical Authors,
Composers and Editors:
Societe des Auteurs, Compositeurs et Editeurs de Musique (SACEM)
225, avenue Charles de Gaul
92521 Neuilly sur Seine, France
Tel: (33-1) 47 15 47 15
Fax: (33-1) 47 45 12 94
Membership acceptances are restricted to reputable applicants who are
already known for the quality of their works. If not qualified for
SACEM, applications must be filed with the National Association of
Musical Authors and Composers:
Syndicat National des Auteurs et Compositeurs de Musique (SNACM)
80, rue Taitbout
75009 Paris, France
Tel: (33-1) 48 74 96 30
Fax: (33-1) 42 81 40 21
For theatrical works, including plays, operas, operettas, musical
comedies, films and theatrical scripts, applications must be file with
the Society for Theatrical Authors and Composers:
Societe des Auteurs et Compositeurs Dramatiques (SACD)
11 bis, rue Ballu
75442 Paris Cedex 09, France
Tel: (33-1) 40 23 44 44
Fax: (33-1) 45 26 74 28
For literary works and software, applications must be filed with the
French Literary Society:
Societe des Gens de Lettres (SGDL)
38, rue du Faubourg Saint-Jacques
75014 Paris, France
Tel: (33-1) 40 51 33 00
Fax: (33-1) 43 54 92 99
For documentary and educational works, applications must be filed with
the Civil Society for Multimedia Authors:
Societe Civile des Auteurs Multimedia (SCAM)
38, rue du Faubourg Saint Jacques
75014 Paris, France
Tel: (33-1) 40 51 33 00
Fax: (33-1) 43 54 92 99
K. Need for Local Attorney
Establishing an entity to do business in France is not a good occasion
for a "do it yourself" approach. A lawyer with experience in France
should be retained as soon as the establishment of a French business
entity is contemplated. The American Embassy in Paris maintains a list
of American Lawyers practicing in France, which is available upon
request. More detailed information about professional backgrounds can
be obtained from the Martindale-Hubbell Law Directory and for the Bar
Register of Pre-eminent Lawyers. Lawyers and bankers in the United
States also will normally have means of recommending lawyers in France.
France has two major categories of legal practitioners:
Avocats: An "avocat" must be a lawyer. "Avocats" may render legal
advice on all matters, draft agreements and contracts, handle commercial
disputes and collection cases, and plead and defend civil and criminal
cases before the French courts to which they are admitted.
Notaries (Notaires): A French "notaire" is a public official appointed
by the Ministry of Justice, and not the equivalent of a public notary in
the United States. The number of "notaires" in each jurisdiction is
limited, and their fees fixed by law. Their functions include the
preparation and recording of notarial acts (wills, deeds, acts of
incorporation, marriage, contracts, etc.), the administration and
settlements of estates (excluding litigation in court) and serving as
the repository of wills. They are not lawyers, but very specialized
members of the legal profession. They may not plead in court.
CHAPTER V.. LEADING TRADE PROSPECTS FOR U.S. EXPORTS AND INVESTMENT
Listed below are 19 industry sectors which the U.S. Embassy in France
considers "best prospects" for U.S. business; they are ranked by
increasing forecast total imports from the U.S.
RANK TOTAL IMPORTS SECTOR SYMBOL NAME
FROM U.S.
1 3,700 IRA
2 3,085 CSF
3 2,533 ICH
4 2,197 EMP
5 1,812 ELC
6 1,478 INS
7 1,430 CPT
8 1,085 SEC
9 990 EPS
10 633 AIR
11 533 FLM
12 447 APG
13 440 MED
14 428 DFN
15 400 APS
16 310 AUT
17 307 POL
18 300 PUC
19 150 TEL
1 - TRAVEL & TOURISM (TRA)
The French travel and tourism market is showing two distinctive trends.
First, the United States is no longer a destination for a privileged
few. In fact, it has become a bread-and-butter mainstay of both tour
operators and retailers. Second, as the French continue to be highly
individualistic in their travel behavior, worries about personal safety
are bringing about an upward trend in the escorted and inclusive tour
segment of the market.
Since 1982, French interest in travel to the U.S. has more than doubled
reaching 863,345 visitors in 1994, with an average growth rate of 4
percent forecast for 1995 and 1996. In 1995, 930,000 French travelers
are expected to visit the U.S., with New York being their primary
destination. According to a 1994 survey conducted by SOFRES of 1000
French households, 57 percent of the French take a summer vacation away
from home. Of those, 19 percent go on vacation for two weeks, 12
percent for three weeks, 8 percent for four weeks, and 5 percent for
more than four weeks. Of the respondents, 79 percent would take a one
week vacation and 20 percent would divide their available leave into two
vacations. The annual paid vacation entitlement of the French workforce
is 5 weeks.
Only 23 percent of French travelers used a travel agent in 1994. For
travel to the United States that figure was 50 percent. The best
customers for U.S. agents are corporate managers, professionals, and
people in the administrative professions. By and large, wholesalers and
tour operators play a smaller role than in other markets. Roughly 30
percent of the French buy packaged products, 10 percent of which involve
fly-drive arrangements. Wholesalers, however, view their investment in
catalog production as a form of cost-effective direct consumer
advertising and hence a basic consumer sales tool. The active Visit USA
travel trade in France consists of roughly 2000 retail agents, 50
wholesalers/tour operators, 20 incentive specialists, and some 120
business and group specialists. All major hotel companies, rental car
firms, rail and cruise lines, and attractions are represented. Nine air
carriers, of which 8 are American, serve 13 U.S. cities on a non-stop
basis.
1994 1995 1996
A. Total Market Size 81,600 83,600 85,700
B. Total Local Production 95,500 98,400 101,400
C. Total Exports 26,900 28,200 29,600
D. Total Imports 13,100 13,800 14,500
E. Total Imports from U.S. 3,200 3,400 3,700
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
2 - COMPUTER SOFTWARE (CSF)
The recessionary environment of the early 90's had a strong negative
impact on French companies' budget policies for computer expenditures.
In addition to this, heightened competition among computer software
vendors caused them to drop their prices at an accelerated pace. In
spite of these challenges, the French computer software market should
continue presenting positive long-term prospects. The introduction of
the latest generation of micro-computers, the accelerating development
of telecommunications, and the creation of networked systems will all
contribute to this growth.
French companies tend to outsource a greater proportion of their
software development than in other European countries, thus making
France the largest software market in Europe, with over 6,000 software
firms. Furthermore, French flagship firms such as Bull (leading
hardware manufacturer) and Cap Gemini Sogeti (leading software and
services company) have helped ensure that adequate resources are
invested in the software industry. The recent growth of the software
industry at the expense of the hardware industry has also led major
hardware companies such as IBM, DEC, BULL and UNISYS to redirect their
resources towards the software sector.
American firms also control the French packaged software market with
products for databases, spreadsheets, CAD/CAM systems and word
processing. The increasing availability of sophisticated off-the-shelf
products as replacements for more expensive custom-made software is
shifting the market toward packaged software products. The U.S.
technological edge in these areas, coupled with the anticipated growth
of the PC software market, should facilitate a continued strong American
presence in the French market. Due to exchange rate fluctuations
between 1994 and 1996, the growth rate of this sector appears to be
declining in terms of dollars, but is in fact growing in terms of units.
1994 1995 1996
A. Total Market Size 18,503 21,805 23,063
B. Total Local Production 16,653 19,857 21,200
C. Total Exports 3,700 4,315 4,522
D. Total Imports 5,550 6,263 6,385
E. Total Imports from U.S. 2,775 3,089 3,085
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
3 - INDUSTRIAL CHEMICAL (ICH)
In 1994, in spite of a world-wide recession, the French chemicals
industry is still quite strong. Demand for all types of chemicals is
increasing, granted at a slower rate than in the 1990-1992 period. As
technological advances continue, and various needs from different
industries arise, the markets for industrial chemicals should continue
to grow. The pharmaceutical and vitamin industries continue to grow due
to consumer trends towards healthy lifestyles (vitamins), and new
medical advances in pharmaceuticals. At the same time, French cosmetics
manufacturers continue to dominate demand worldwide. These markets,
however, are highly competitive.
A few potential issues are:
-- an increasing number of environment-related regulations are raising
costs and discouraging investment
-- a change in the level of reimbursement of pharmaceuticals by the
French social security could affect consumption and ultimately imports.
-- worldwide prices are being rocked by the influx of chemicals from
former Eastern Block countries.
1994 1995 1996
A. Total Market Size 95,600 108,400 109,473
B. Total Local Production 68,300 77,400 78,196
C. Total Exports 37,700 42,709 43,136
D. Total Imports 21,950 24,883 25,131
E. Total Imports from U.S. 2,210 2,510 2,533
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
4 - EMPLOYMENT SERVICES (EMP)
Unemployment, currently 11,6 percent of the working population, remains
a major economic problem. The employment services industry having
suffered a 20 percent decrease in turnover in 1993, saw the trend
reversed in 1994 as recruitment firms enjoyed a 9 percent increase in
sales. The beginning of 1995 seems to have confirmed this trend, and
professionals are optimistic.
Temporary employment services are usually a good indicator of the
employment market. After three years of decline, the industry
registered an increase of 27 percent in sales in 1994 compared to the
previous year. The recovery is evident in the industrial sector,
particularly due to the special government allowance, "Prime Balladur",
which boosted the sales of cars and positively affected other industry-
related sectors.
In the temporary services sector, four major companies account for 50
percent of the market. The leading employment services company, ECCO,
is French, followed by the U.S. company MANPOWER, the French company
BIS, and the Swiss company ADIA.
American recruitment firms figure most prominently in executive search
where they represent some 25-30 percent of the market and account for
about 43 percent of revenue. Almost all major U.S.
headhunter/recruitment companies are already present in France and enjoy
a good reputation.
Access to the French employment services market is relatively easy as
there are no trade barriers, and U.S. firms are subject to the same
regulations and standards as are local firms.
The most promising subsectors are in heavy industry, with an estimated
1995 market size of USD 5,066 million, and services, with an estimated
1995 market size of USD 2,430 million.
1994 1995 1996
A. Total Market Size 9,900 9,990 10,989
B. Sales by Domestic Firms 7,326 8,092 8,900
C. Export Sales 1,049 1,059 1,164
D. Sales by Foreign-owned Firms 2,871 2,897 3,186
E. Sales by U.S.-owned Firms 1,782 1,998 2,197
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
5 - ELECTRONIC COMPONENTS (ELC)
The figures listed below, other than the projections for 1995 and 1996,
are based on official trade statistics for electronic components, both
passive and active.
It is difficult to assess the true U.S. portion of electronic component
imports in France. It is estimated that the United States accounts for
32 percent of active component imports and 11 percent of passive
component imports. However, many American-made products transit through
third-party countries before reaching France, and do not appear as U.S.
origin imports. In addition, U.S. firms such as Motorola and Texas
Instruments France have major manufacturing facilities in France, but
the output of these plants are considered to be local French production.
Total French demand for electronic components is distributed among the
following products: 31 percent for semiconductors, 17 percent for
printed circuits, 10 percent for connectors, 9 percent for passive
components, 8 percent for tubes, 4 percent for hybrids and 21 percent
for other miscellaneous components. Some segments boosted by emerging
new end-user markets, such as mobile telecommunication systems,
automobile electronics, and smart card IC applications, should be
experiencing strong growth rates averaging 7 to 15 percent. Due to
exchange rate variations between 1994 and 1996, the growth rate of this
sector appears to be declining in terms of dollars, but is in fact
growing consistently in terms of units.
1994 1995 1996
A. Total Market Size: 5,637 7,005 7,828
B. Total Local Production: 5,606 6,934 7,750
C. Total Exports: 5,615 6,979 7,800
D. Total Imports: 5,646 7,050 7,879
E. Total Imports from U.S.: 1,310 1,621 1,812
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
6 - INSURANCE SERVICES (INS)
In the early '90s, French insurance companies started diversifying their
investments. In 1994, the industry was hurt both by the downturn in
financial markets as well as the real estate crisis. Today, as a result
of these unfortunate investments, the insurance industry is
restructuring to concentrate on its core activity
The French insurance industry is ranked fifth in the world after the
United States, Japan, the United Kingdom, and Germany. The French
companies UAP and AXA are among the ten leading insurance companies
worldwide.
Despite difficult times in 1994, the industry has continued its
development with an approximate overall growth rate of 10 percent. The
most promising subsectors include insurance of the person, especially
life insurance with more than 20 percent growth over the last two years,
and an estimated market size of USD 88,800 million. While analysts
expect slight stagnation in life insurance during the coming years
because of increased competition, insurance companies are looking into
new proposals with high growth potential, such as pension funds.
Many analysts have high expectations for pension funds, pending
government approval. U.S. companies could certainly benefit from such a
decision, when adopted. The French insurance industry has already taken
the lead by creating its own employee pension funds will from January 1,
1996. This initiative is expected to put pressure on the government
decision process.
The French market is highly competitive, however foreign companies can
access to it through a branch or a subsidiary upon approval of the
French Ministry of Economy and Finance.
1994 1995 1996
A. Total Market Size 134,040 148,935 165,485
B. Sales by Domestic Firms 121,976 135,530 150,590
C. Export Sales 1,608 1,787 1,985
D. Sales by Foreign-owned Firms 12,465 13,850 15,390
E. Sales by U.S.-owned Firms 1,192 1,325 1,478
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
7 - COMPUTER AND PERIPHERALS (CPT)
France is the second largest information technology market in Europe,
and the fourth largest computer market in the world. This reflects the
high priority given by the French government to the computerization of
the country's institutions.
PCs and workstations will be the fastest growing segment of the French
computer and peripheral market, rising 10 percent annually between 1993
and 1997. Small-scale multi-user computers sales should also post
modest gains during this period.
Worldwide recession affected the French hardware market into early 1994.
However, growth of personal computer sales from 1994-1996 is expected to
reach 14 percent, with more modest growth anticipated for mid-range and
mainframe systems.
The six largest suppliers of hardware in France are IBM, BULL, DIGITAL,
COMPAQ, ICL and APPLE. Four of these are American. Although large
companies still dominate the micro-computer industry, smaller
organizations are entering the market through innovative marketing
methods such as mail-order and telemarketing.
In terms of product choice, the widespread acceptance of Windows, the
operating system developed by Microsoft, has shifted the market toward
IBM-compatible products and away from Apple products. Consumers have
also become more targeted on their choices and now prefer well-known
brands over clones, especially as the price differences between the two
product categories have become negligible. Due to exchange rate
fluctuations between 1994 and 1996, the growth rate of this sector
appears to be declining in terms of dollars, but is in fact growing in
terms of units.
1994 1995 1996
A. Total Market Size 8,437 9,520 9,647
B. Total Local Production 4,935 5,708 5,774
C. Total Exports 422 479 483
D. Total Imports 3,902 4,292 4,356
E. Total Imports from U.S. 1,255 1,416 1,430
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
8 - SECURITY AND SAFETY EQUIPMENT (SEC)
The French market for security and safety equipment is the second
largest in Europe after Germany. The rapid and considerable growth of
this industry between 1989 and 1992 has slowed down along with the
French economy. However, market demand has enjoyed sustained growth
over the past two years and by 1997 is expected to return to its normal
annual growth rate of 10-12 percent. Industry experts believe that
market demand will rise by 100 percent in the next ten years, due to the
aging of the population.
U.S. industry exports to France were estimated to be worth USD 1,028
million in 1994, representing approximately 49 percent of the French
import market. By 1995, they are expected to continue to increase in
line with projected market growth. There is a lack of domestic and
foreign competition in this segment.
In the security and safety equipment market, some subsectors are more
buoyant than others. Electronic surveillance and access controls should
remain the most dynamic. Tele-assistance is another subsection which
promises to offer short and mid-term growth opportunities. Best
prospects for American companies include telesurveillance equipment for
boiler rooms and elevators, biometrics systems, fire extinguishing
agents, and sprinklers.
1994 1995 1996
A. Total Market Size 5,438 5,601 5,806
B. Total Local Production 4,358 4,445 4,614
C. Total Exports 1,035 1,053 1,094
D. Total Imports 2,115 2,209 2,286
E. Total Imports from U.S. 1,028 1,051 1,085
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
Please note that the statistics above do not include security services
and technical control, and are unofficial estimates.
9 - ELECTRICAL POWER SYSTEMS (EPS)
The French market for electrical power systems has remained stable over
the past two years. Market growth for 1996 is not expected to exceed 2-
3 percent.
The search for the most environmentally sound, energy efficient and cost
efficient means of generating and transmitting electric power will
continue to drive the market over the next five years. In addition,
environmental concerns are leading to more stringent legislation.
Consequently, great potential exists for fuel gas desulphurization
equipment (FGD), gas turbines, waste heat boilers and cogeneration
systems. The safety of nuclear power stations, which continues to be a
priority of the French government, will keep demand rising for
pressurized water reactors (PWR).
Presently, ninety percent of the domestic market is served by
Electricite de France (EDF), a French government-owned electricity
company, and its subsidiaries or partner firms. However, under pressure
from Brussels, EDF has indicated that it plans to reconsider its
monopolistic position, opening the way for other operators, and offering
major energy users the possibility of acquiring energy from independent
producers. Furthermore, as a result of EU directives on government
procurement, France should offer a more competitive and open market for
foreign electrical power system manufacturers. Thus should offer
promising opportunities for U.S. electrical equipment manufacturers.
1994 1995 1996
A. Total Market Size 11,050 11,060 11,220
B. Total Local Production 10,350 10,350 10,400
C. Total Exports 6,320 6,340 6,460
D. Total Imports 5,620 5,630 5,660
E. Total Imports from U.S. 970 970 990
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.0 FRF 5.1
The above statistics are unofficial estimates.
10 - AIRCRAFT AND PARTS (AIR)
Although noting the improved market in 1994, industry experts predict a
slight decline in revenues for 1995 followed by a modest improvement in
1996.
The rise in worldwide passenger traffic helps explain the European
Airbus consortium's return to profitable trading in 1994. New orders
rose to 125 and cancellations dropped to 54, adding 71 aircraft to the
order books.
During the year, Airbus delivered 123 aircraft, over half from the
A320/321 family, to companies in 33 countries. At year's end the total
number of aircraft on order was 615, or 52 less than the 667 on order at
the end of 1993. This represents a little over four year's production.
The Franco-Italian ATR consortium delivered 48 turpoprop transports in
1994, increasing its output from 1993. On the business aircraft front,
1994 was a better year for French manufacturer Dassault Aviation as
well. With 45 firm orders, almost all from export markets, Dassault
sold twice as many Falcons as in 1993.
France's helicopter market, however, remained depressed. The drop has
been particularly felt in military markets. France's overall aircraft
market is split roughly 50/50 between civil and military customers.
Revenues from space programs are buoyant, reflecting the full manifest
of the Ariane space launcher.
Source: GIFAS
1994 1995 1996
A. Total Market Size 2,360 2,308 2,343
B. Total Local Production 5,664 5,539 5,622
C. Total Exports 4,720 4,616 4,685
D. Total Imports 1,416 1,385 1,406
E. Total Imports from U.S. 637 623 633
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
11 - FILMS, VIDEOS AND OTHER RECORDINGS (FLM)
A total of 115 films were produced in 1994, of which 89 were French-
initiated films and 36 minority co-productions, including four with
Central and East European countries. Two-thirds of the French-initiated
films were wholly French-produced, and a third were principally French-
produced with minority partners.
In 1994, 126 million people filled France's 4,235 movie theaters
representing USD 860 million of box office receipts. The film viewing
public was divided as follows: U.S. films were seen by 76 million
people, European films by 51 million people, and French films by 35
million people.
According to the French Ministry of Culture, French adults spent on
average USD 14.4 on cinema tickets, USD 54 on the annual TV license or
pay-TV services, and USD 51.4 on videocassettes. Consumer spending on
pay-TV and videocassettes grew 230 percent between 1980 and 1993, while
box-office receipts fell 20 percent during the same period.
Household expenditures on video cassettes amounted to USD 567.63
million, including rentals (USD 63.94 million) and sales (USD 503.69
million). Household expenditures on laser disks amounted to USD 15.75
million, a 19.82 percent decrease compared with 1993 figures (19.65
million). Laser disks represented 3.12 percent of 1994 video cassette
sales.
In 1994, video sales were broken down as follows: French films accounted
for 6.5 percent, foreign films for 44.5 percent, special event videos
for children for 35 percent, while other video recording accounted for
the remaining 14.0 percent of sales.
1994 1995 1996
A. Total Market size 763.46 779 792
B. Total Local Production 243.23 248 252
C. Total Exports 73.40 75 76
D. Total Imports 593.63 605 616
E. Total Imports from U.S. 513.71 524 533
F. Exchange Rate: USD 1 FRF 5.50 FRF 5.0 FRF 5.10
The above statistics are unofficial estimates.
12 - AVIONICS AND GROUND SUPPORT EQUIPMENT (APG)
The United States is France's leading foreign supplier of avionics and
ground support equipment with approximately 45 percent share of the
import market.
Long term U.S. suppliers to the Airbus program include, Allied Signal,
Auxitrol, BF Goodrich, Fairchild, Litton, Raychem, Rockwell-Collins,
Rohr, Sundstrand, among others. These firms could offer opportunities
for small and medium sized firms to enter the market.
In spite of pessimistic projections by trade specialists for the short
term, some sub-sectors may still offer potential to France. Demand for
on-board telecommunications (SATCOM) and entertainment (Video Equipment)
is expected to increase. The French company Alcatel Telspace is
developing an European network TFTS (Terrestrial Flight Telephone
System) that will permit in-flight passengers to be connected to public
lines. According to media reports, however, TFTS is several years
behind its American counterpart.
Modernization and expansion programs are underway at international
airports in Paris, Marseilles, and Lyon. The Paris Airport Authority is
spending USD 1.4 to upgrade Orly and greatly expand Roissy-Charles de
Gaul. There is also a project to enlarge Marseilles Provence Airport,
expanding total capacity to 90,000 spm before the year 2000. At Lyon, a
four-year expansion program is underway, designed to turn Lyon-Satolas
Airport into an international connecting hub with a focus on intermodal
transportation.
1994 1995 1996
A. Total Market Size 1,880 1,839 1,866
B. Total Local Production 4,512 4,413 4,479
C. Total Exports 3,760 3,677 3,732
D. Total Imports 1,128 1,103 1,120
E. Total Imports from U.S. 450 440 447
F. Exchange Rate: USD 1 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
13 - MEDICAL EQUIPMENT (MED)
The French medical equipment sector continues to grow at levels
commensurate with the population increase and extended life expectancy.
The recent growth of U.S. medical procedures and techniques in France
such as (outpatient) same day surgery should benefit U.S. medical
product manufacturers. Along with products used by the elderly and
home-medical care recipients, these products will be in great demand in
the future.
The current strain on public budgets has re-emphasized the importance of
the price/quality factor, as well as a need for more cost-effective
equipment. Since up to 70 percent of all French medical costs are
reimbursed, there has been a historical tendency for health-care
providers and patients to overconsume and pay little attention to costs.
Such overconsumption has endangered the social security system and
caused health-care professionals to become more price-sensitive. This
shift in priorities provides opportunities for suppliers of price-
competitive products.
American products also enjoy a positive reputation in France. They are
perceived to feature the latest technology and to be of high quality and
well-serviced. This opinion is reinforced by French trade publications,
scientific journals and, most importantly, by word-of-mouth among the
various end-users. In sum, the French market is large and receptive to
American products.
The best sales prospects for medical equipment include newly developed
areas such as non invasive surgery, orthopedic and disposable medical
equipment. The medical equipment sector depends highly on imports,
mainly from the U.S., followed by Germany, Japan and Italy.
1994 1995 1996
A. Total Market Size 2,086 2,149 2,213
B. Total Local Production 1,042 1,040 1,046
C. Total Exports 526 550 577
D. Total Imports 1,570 1,660 1,766
E. Total Imports from U.S. 392 415 440
F. Exchange Rate: FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
14 - DEFENSE INDUSTRY EQUIPMENT (DFN)
France has arguably the largest and most sophisticated armed forces in
Europe. The budget to sustain this force structure and the size of the
French defense industry point to a potentially huge export market. On
the other hand, national defense is at the core of an established
industrial policy that favors indigenous development over procurement
from non-French sources. Actual exports to the French defense
establishment are mainly European exports in the scope of common
european defense programs. Imports increased by more than 100 percent
over the past ten years -- much of the increase benefiting U.S.
suppliers. In order to be successful in France, U.S. defense firms need
to establish a permanent presence, they must understand the role of the
Delegation General for Armament (DGA); on a case by case basis, they
could be required to offer offsets, and, for large programs, they need a
French partner. U.S. export opportunities are still viable in cases
where French concerns cannot justify parallel development. Most U.S.
companies enter the French market as a subcontractor.
Source: DGA, EIA, and post files
1994 1995 1996
A. Total Market Size 21,203 21,588 20,508
B. Total Local Production 34,005 34,685 32,950
C. Total Exports 13,602 13,847 13,155
D. Total Imports 800 750 713
E. Total Imports from U.S. 416 400 428
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.0 FRF 5.1
The above statistics are unofficial estimates.
15 - AUTOMOTIVE PARTS AND SERVICE EQUIPMENT (APS)
French automobile equipment industry sales increased a small 1.5 percent
in 1994, largely due to governmental measures. Prospects for 1995 are
looking better, with a probable two figure increase.
Aftermarket sales, particularly since the implementation of mandatory
inspections for vehicles over 5 years old, are expected to profit from
this increase. Two major segments of the aftermarket sector (tires and
lubricants) show that the general environment is favorable: Market size
for car lubricants in 1994 was up 0.8 percent in the replacement market
and up 14 percent in the O.E.M market. Tires experienced an overall +
12.7 percent increase in volume.
In 1994, the market share of the automotive parts sold by independent
networks, agents, and distributors rose by 3 points while those sold by
manufacturers declined by 2 points. Because of lower overhead costs,
auto centers have become very popular with DIY car repairers as part
prices are very competitive and on-the-spot servicing is also available.
There has been an increasing development of auto centers specializing in
tire and oil replacement in large supermarkets and malls.
1994 1995 1996
A. Total Market Size 11,905 12,499 12,749
B. Total Local Production 14,817 15,557 15,868
C. Total Exports 10,371 10,889 11,107
D. Total Imports 7,459 7,831 7,988
E. Imports from the U.S. 372 391 400
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
16 - AUTOMOBILES AND LIGHT TRUCKS (AUT)
In 1994, the French vehicle fleet represented approximately 29,450,000
automobiles. France manufactured 3,175,213 private cars in 1994, a 11.9
percent increase from 1993. Of these, 1,975,436 were exported. During
the same period, France imported (and registered) 765,521 vehicles,
representing 38.8 percent of the country's 1,972,919 registered
vehicles. Industry experts expect car sales to stablize in 1995 to
around a 2 to 4 percent sales increase.
Electric vehicles constitute an important market trend. French car
manufacturers Automobiles Renault and Peugeot PSA will be launching
three electric car models in September 95. To date, France has
approximately 1,500 electric vehicles equipped with either lead-acid or
nickel-cadmium batteries. Trade specialists predict that 200,000
vehicles will be operating in major European cities within 10 years, and
that sales of electric cars will reach 50,000 units annually by the year
2000.
Small city cars, such as the Mercedes-Swatch project, with hybrid
propulsion (electric/diesel or gas engines) are also a trend in
development. This model is expected to reach consumers in 1997.
1994 1995 1996
A. Total Market Size 53,974 53,944 57,008
B. Total Local Production 59,770 62,160 63,348
C. Total Exports 27,501 26,728 27,262
D. Total Imports 19,905 20,512 20,922
E. Imports from the U.S. 298 304 310
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
17 - POLLUTION CONTROL EQUIPMENT & SERVICES (POL)
The French market for pollution control equipment and services continues
to grow steadily as a result of French legislation and European
Directives. Landfill management techniques, waste incineration,
recycling methods, bio-remediation of contaminated sites, increased
emphasis on monitoring and limiting air pollution are all important
issues being addressed by the Ministry for the Environment. New taxes
are being levied on the disposal of industrial wastes to pay for the
clean-up of some 700 polluted sites throughout France. Additional sites
are expected to be identified in the near future.
As a result of European directives, French authorities have developed a
long-term plan to bring France's environmental standards to a level
comparable to those enforced in other EU countries. For example,
massive investment programs in waste water treatment infrastructure will
be spent over the next ten to fifteen years.
The difficulty in evaluating an industry composed of so many often
unrelated markets (i.e. analytical instruments, trash containers,
incineration ovens or bio-remediation chemicals), is that most
manufacturers of equipment for use in environmental applications also
produce a broad range of unrelated products. However, the sales figures
from these firms consolidate the sales of both their environmental and
non-environmental products.
U.S. firms active in France provide high-tech, innovative and unique
solutions to controlling pollution. Competition from nearby European
countries is high, particularly from Germany, U.K., Sweden, Netherlands
and Switzerland.
The pollution control equipment sector includes the production of goods
and services for measuring, preventing, limiting, or treating
environmental damage including the pollution of water, air, and land,
noise pollution, and waste. Due to exchange rate fluctuations between
1994 and 1996, the growth rate of this sector appears to be declining in
terms of dollars, but is in fact growing in terms of units.
1994 1995 1996
A. Total Market Size: 13,498 15,590 16,049
B. Total Local Production: 20,564 23,299 23,985
C. Total Exports: 10,440 11,536 11,768
D. Total Imports: 3,375 3,828 3,833
E. Total Imports from U.S.: 243 285 307
F. Exchange Rate: FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
18 - PUMPS, VALVES AND COMPRESSORS (PUC)
The French valve market is the largest in Europe and one of the most
competitive, generating USD 2.1 billion in local sales and exports.
From 1988 to 1994 the French market experienced an average 8.5 percent
annual growth rate, with a period of contraction in 1992-1993. The taps
were re-opened in 1994 as the market flowed at a healthy 7.9 percent
rate of growth.
The industrial valve sector generally followed the same pattern, but
exceeded expectations in 1994 by posting a sales volume of USD 560
million (up from USD 460 million in 1993). Activity in the industrial
valve sector represents 60 percent of the total valve market.
French companies retain control of the domestic market for regulation
valves, and are leaders in the production of "high security" valves.
However, the presence of foreign companies is growing stronger. In
fact, imports contribute 35 percent to the total industrial valve
market. With 10 percent of the import market share, the U.S. is the
third largest source of imported valves and maintains leading import
positions in security valves, check valves and steel gate valves.
With USD 850 million the French pump market is the largest in Europe and
certainly one of the most competitive vis-a-vis the number of firms
present as well as the level of technology requested. Cutback in the
nuclear program have reduced the demand for large industrial pumps, but
nuclear applications still represent 28 percent of the global market.
Focus has been shifted to water treatment applications, which represent
50 percent of the market and which are expanding due to the continuous
need for infrastructure and public funds directed to those programs. In
1994, France pump imports represented more than USD 930 million. Germany
is by far the largest supplier, leading the U.S., Spain and Italy.
France 's compressor market is valued at USD 400 million. This sector
is largely dominated by foreign firms that often have production
facilities in France or control French firms. The U.S. has a strong
position thanks to world-wide leading companies such as Ingersoll-Rand
and Dresser.
1994 1995 1996
A. Total Market Size 2,750 3,000 3,100
B. Total Local Production 2,950 3,300 3,180
C. Total Exports 2,200 2,650 2,740
D. Total Imports 2,200 2,450 2,525
E. Total Imports from U.S. 270 295 300
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The above statistics are unofficial estimates.
19 - TELECOMMUNICATIONS EQUIPMENT (TEL)
France Telecom operates virtually all public communications networks in
France. Among these are the public switched telephone network (PSTN),
packet-switched data network, telex network, private leased circuits,
mobile communications networks, and the integrated services digital
network (ISDN) known as Numeris. The French network uses digital,
fiber-optic and terrestrial microwave systems and is generally
considered to be one of the most advanced and reliable systems in
operation.
The number of telephone lines installed in 1994 reached 31.6 million,
including Numeris-ISND Access lines. With a receiver for every 1.5
inhabitants, France ranks behind the United States and Canada and ahead
of Germany, United Kingdom and Italy.
In 1993, France represented an estimated 4.1 percent of the world market
for telecommunications equipment. Current growth trends indicate that
France, for several years to come, will be one of the world's most
attractive markets for mobile infrastructure, satellite antennae,
optical fiber, telephone sets, mobile telephones and pagers, and fax
machines.
All the hardware and software used by France Telecom is purchased from
the private sector, thereby accounting for a large share of the nation's
telecommunications equipment acquisitions. France Telecom is also a
major buyer of customer premises equipment (CPE), although private
companies currently dominate this market. With robust growth in this
sector, and the expansion that is expected to accompany European
telecommunications deregulation in 1998, American companies should be
prepared to take advantage of the manifold sales opportunities presented
by the French market.
1994 1995 1996
A. Total Market Size 3,692 3,810 3,881
B. Total Local Production 4,759 4,900 5,010
C. Total Exports 1,653 1,850 1,970
D. Total Imports 586 760 841
E. Total Imports from U.S. 120 142 150
F. Exchange Rate: USD 1.00 FRF 5.50 FRF 5.00 FRF 5.10
The figures above are unofficial estimates.
B. BEST PROSPECTS FOR AGRICULTURAL PRODUCTS
New market opportunities (or current opportunities which need to be
heavily targeted) in France for U.S. agricultural exporters exist in a
number of areas: fresh fruits and vegetables (particularly tropical and
exotic), fruit juices and other beverages, including flavored spring
waters, frozen foods (both ready-to-eat meals and specialty products
like pizza and ice cream), snack foods such as cookies, chips and nuts,
"ethnic" products featuring distinctive themes and flavors such as Tex-
Mex, Cajun or California-style cuisine's, seafood (particularly salmon),
wild rice, innovative dietetic and health products, organic products,
soups, breakfast cereals and pet foods.
Listed below are 6 agricultural sectors which FAS France considers "best
prospects" for U.S. business (figures in USD millions):
RANK TOTAL IMPORTS SECTOR SYMBOL NAME
FROM U.S.
- 61 MISC. FOOD PREPARATIONS;
-INCL SOUPS, SAUCES & ICECREAMS
- 70 PROCESSED FRUITS & VEGETABLES,
- INCL. FRUIT JUICES
- 125 FISH AND SEAFOOD, FRESH OR FROZEN
- 115 WOOD
- 12 BEVERAGES, INCLUDING MINERAL
WATER, BEER, WINE AND SPIRITS
- 115 FRESH AND DRIED FRUITS;
INCLUDING NUTS
Rank: n/a
Name of Sector: FRESH AND DRIED FRUITS; INCLUDING NUTS
HS Code: 08
1994 1995 1996
(Jan-Dec) (P) (F)
A. Total Market Size 3,790 3,900 4,020
B. Total Local Production 2,519 2,595 2,672
C. Total Exports 1,226 1,265 1,300
D. Total Imports 2,497 2,570 2,650
E. Total Imports from U.S. 125 135 145
F. Exchange Rate: USD 1.00 = FRF 5.55
Rank: n/a
Name of Sector: WOOD
HS Code: 44
1994 1995 1996
(Jan-Dec) (P) (F)
A. Total Market Size 2,924 2,985 3,045
B. Total Local Production 2,630 2,680 2,735
C. Total Exports 1,728 1,765 1,795
D. Total Imports 2,022 2,062 2,103
E. Total Imports from U.S. 113 115 120
F. Exchange Rate: USD 1.00 = FRF 5.55
Rank: n/a
Name of Sector: FISH AND SEAFOOD, FRESH OR FROZEN
HS Code: 03
1994 1995 1996
(Jan-Dec) (P) (F)
A. Total Market Size 2,804 2,860 2,920
B. Total Local Production 1,452 1,480 1,510
C. Total Exports 778 795 800
D. Total Imports 2,130 2,175 2,220
E. Total Imports from U.S. 97 100 105
F. Exchange Rate: USD 1.00 = FRF 5.55
Rank: n/a
Name of Sector: PROCESSED FRUITS AND VEGETABLES, INCLUDING FRUIT JUICES
HS Code: 20
1994 1995 1996
(Jan-Dec) (P) (F)
A. Total Market Size 4,787 4,885 4,980
B. Total Local Production 4,126 4,210 4,295
C. Total Exports 851 870 885
D. Total Imports 1,512 1,540 1,570
E. Total Imports from U.S. 68 70 75
F. Exchange Rate: USD 1.00 = FRF 5.55
Rank: n/a
Name of Sector: MISCELLANEOUS FOOD PREPARATIONS; INCLUDING SOUPS, SAUCES
AND ICE CREAMS
HS Code: 21
1994 1 995 1996
(Jan-Dec) (P) (F)
A. Total Market Size 4,279 4,320 4,360
B. Total Local Production 5,276 5,360 5,435
C. Total Exports 1,745 1,800 1,850
D. Total Imports 748 760 775
E. Total Imports from U.S. 54 56 60
F. Exchange Rate: USD 1.00 = FRF 5.55
Rank: n/a
Name of Sector: BEVERAGES, INCLUDING MINERAL WATER, BEER, WINE AND
SPIRITS
HS Codes: 22.01 to 22.06 and 22.07 + 22.08
1994 1995 1996
(Jan-Dec) (P) (F)
A. Total Market Size 11,869 12,105 12,350
B. Total Local Production 17,838 18,190 18,555
C. Total Exports 7,334 7,480 7,630
D. Total Imports 1,365 1,390 1,420
E. Total Imports from U.S. 31 35 40
F. Exchange Rate: USD 1.00 = FRF 5.55
CHAPTER VI. TRADE REGULATIONS AND STANDARDS
A. Tariffs and Import Taxes
The member states of the European Union have established a Community
Integrated Tariff (TARIC) system, under which duties are applied to
imports from non-EU countries. TARIC was established by the 1958 Treaty
of Rome as part of the European Economic Community (EEC).
The duties levied on imports from non-EU countries, including the United
States, are moderate. Most raw materials enter duty-free or at low
rates, while most manufactured goods are subject to rates of between 5 -
17 percent. Most agricultural product imports are covered by the Common
Agricultural Policy (CAP), under which many items are subject to
variable levies designed to equalize the prices of imported commodities
with those produced in the EU.
France and other EU member states extend varying preferential tariff
treatment to imports from the African, Caribbean and Pacific developing
countries (under the Lome Conventions), several French and Dutch
territories and departments, Turkey, Egypt, Morocco, Tunisia, Algeria,
Israel, Malta, Cyprus, Jordan, Lebanon, and Syria. Tariff preferences
are also extended to over 100 developing countries under the Generalized
System of Preferences (GSP).
To export consumer-ready food products to France, a U.S. exporter should
consider market access restrictions and food laws. Most processed
products entering the European Union and France are subject to
additional import charges based on the percentage of sugar, milk fat,
milk protein and starch in the product. These additional import
charges may make certain imported processed products non-competitive in
the European market, vis-a-vis similar products produced in the EU. The
situation should improve over the next few years because these charges
will be converted to fixed tariff equivalents and reduced under the
Uruguay Round Agreement. Interested U.S. exporters should contact the
Office of Agricultural Affairs for up-to-date information on this issue.
The EU tariff schedule is based on the Customs Cooperation Council
Nomenclature (CCCN), also referred to as the Harmonized System. This
system was introduced to provide a standard tariff classification regime
for all products imported and exported throughout the world.
B. Trade Barriers
U.S. companies sometimes complain of France's complex technical
standards and of unduly long testing procedures. Testing requirements
(which must usually be done in France) and standards sometimes appear to
exceed reasonable requirement levels needed to assure proper performance
and safety. Most of the complaints have involved electronics,
telecommunications equipment and agriculture phytosanitary standards.
The 1989 EU Broadcast Directive requiring a "majority proportion" of
programming to be of European origin was incorporated into French
legislation on January 21, 1992. France, however, specifies a
percentage of European programming (60 percent) and French programming
(40 percent). These broadcast quotas were approved by the EU Commission
and became effective on July 1, 1992. They are less stringent than
France's previous quota provisions which required that 60 percent of all
broadcasts be of EU origin and that 50 percent be originally produced in
French. The 60 percent European/40 percent French quotas are applicable
throughout the day, as well as during prime time slots. The prime time
rules go beyond the requirements of the EU Broadcast Directive and will
limit the access of U.S. programs to the French market. Nevertheless,
the market share of U.S. films and television shows remains high.
The French government has recently revised its legal services system.
Non-EU lawyers may no longer practice as legal consultants and are
required to qualify as "avocats," on the basis of full-fledged
membership in the French bar. Under the implementing legislation which
went into effect on January 29, 1993, this means that non-EU lawyers
will have to pass either a "short-form" exam or the full French bar
exam. Non-EU lawyers will qualify for a "short-form" exam provided they
are able to prove that the foreign state or territorial unit in which
they practice allows French lawyers to practice law "under the same
conditions." Failing that, they will have to take the full French bar
exam. Due to EU regulations, France is required to recognize law
degrees for EC nationals but not third country nationals. Nevertheless,
non-French EU lawyers, who are also required to qualify as "avocats",
may do so via exams less stringent that those for non-EU lawyers.
Meaningful access will now hinge on how implementing regulations are
administered, including the interpretation of what is meant by granting
access on a 'reciprocal basis' and the nature of the exam to be imposed
on the non-EU lawyers.
C. Customs Valuation
Import duties are calculated on an ad valorem basis, i.e. expressed as a
percentage of the value of the imported goods. This dutiable value is
the "transaction value" plus freight, insurance, commissions, and all
other charges and expenses incidental to the sale and delivery of the
goods to the point of entry into EU customs territory. The invoice
price will normally be accepted as the transaction value if the seller
and the buyer are not related.
Under Article VII of the General Agreement on Tariffs and Trade (GATT),
there are four additional methods for the determination of customs
valuation in the event that the method described above is rejected by
customs authorities.
These methods are to be applied in the following order: (1) the
transaction value of incidental goods; (2) the transaction value of
similar goods; (3) the deduction method, i.e. the resale price, less
such costs as customs duties, taxes and commissions; and (4) the
computed value, utilizing costs of production, profit, and other
expenses.
D. Internal Taxes
In addition to the duties levied under the Common External Tariff, goods
imported into France are also subject to a Value Added Tax (VAT).
Currently, the VAT in France is generally charged at one of two rates:
- the standard rate of 18.6 percent
- the reduced rate of 5.5 percent, applicable mostly to
agricultural products and foodstuffs, original artworks and certain
medicines.
VAT must be added to the price of all goods and services sold in France
in connection with an industrial or commercial activity. The supplier
of any goods or service bills his customer at his selling price, plus
the amount of VAT at the applicable rate. The supplier collects the
full amount, subtracts his own VAT expenditures from the total amount of
VAT collected, and periodically pays over the difference to the tax
authorities.
E. Export Controls
France cooperates with her trading partners, including the U.S., to
control the export of products and technologies with potentially
strategic applications. There are no restrictions or regulations on the
export of merchandise from France, with the exception of strategic
products (including arms and dual-use technologies) and antiques.
Before exporting these items, special license must be obtained from
customs officials to insure that the objects being exported are not a
part of the national heritage of France.
Information on U.S. export controls is available from:
Office of Export Administration
U.S. Department of Commerce
Washington, DC 22030
Tel: (202) 482-4811
For overseas companies: (202) 482-2547
F. Import/Export Documentation
Import and export transactions exceeding FRF 250,000 in value must be
conducted through an approved banking intermediary. Goods must be
imported/exported no later than six months after all financial and
customs arrangements have been completed.
For products originating in countries other than EU member states or
participants in the General Agreement on Tariffs and Trade (GATT), and
for a limited number of products considered to be sensitive, a specific
import/export license may be required by product or by category of
products. Otherwise, the following documents are required to import
into France:
Shipping Documents. The documents generally required by France on all
sea and air shipments from the United States include the commercial
invoice, the bill of landing or air waybill, and a certificate of
origin.
Commercial Invoice. As in a domestic transaction, the commercial
invoice is a bill for the goods from the buyer to the seller. No
special form of commercial invoice is prescribed; the firm's letterhead
may be used. The invoice should contain the following details both in
English and French:
-- Names and addresses of seller and buyer.
-- Place and date the invoice was prepared.
-- Method of shipment.
-- Number, kind and markings of the packages and their numerical
order.
-- Exact description of the goods-customary commercial description
according to kind, quality, grade, etc., with special emphasis on
factors increasing or decreasing their value.
-- Quantity of goods, expressed in units customary in international
trade.
-- Agreed price of the goods (unit cost, total cost, including
shipping and insurance charges, as well as other expenses charged to the
costs of the goods).
-- Delivery and payment terms.
-- Although not a requirement, it is advisable to have the signature
of a responsible official of the exporting firm on each invoice.
Bill of Landing or Airway bill. This is a contract between the owner of
the goods and the carrier. Either a straight or negotiable bill of
landing is acceptable. No consular formalities are required, and
shipments may be made freight collect.
Certificate of Origin. This document certifies that the goods entering
French territory are made in the United States, and thus are subject to
the duties, taxes and restrictions that apply to U.S. goods. Although
certificates of origin are not expressly required for all imports into
France, they are strongly recommended. If a shipment is not accompanied
by a certificate of origin, it may be held up by customs. French
authorities accept certificates of origin certified by local U.S.
chambers of commerce.
Other Documents. Information on documents required for exportation to
France of agricultural products (including food items), plants and
animals is available from the Foreign Agricultural Service of the
Department of Agriculture. Owing to the complexities of these
regulations, U.S. exporters should also obtain information directly from
the importer prior to shipment.
For information on duties, taxes, and documentation, contact one of the
following two offices:
Office of European Community Affairs
U.S. Department of Commerce
14th & Constitution, Rm. 3314
Washington, D.C. 20230
Tel: (202) 482-2905
Fax: (202) 482-2155
Centre de Renseignements des Douanes
23, rue de l'Universite
75007 Paris France
Tel: (33-1) 40-24-65-10
Fax: (33-1) 40-24-65-30
G. Temporary Entry
Samples and Carnets. Samples of no commercial value enter France free
of duties and taxes. When sending such samples parcel post, the sender
must specify what type of samples are being shipped. "No commercial
value" should be written on the appropriate shipping documents.
In order for samples of commercial value to enter France duty- and tax-
free, a bond or deposit of the total amount of duties and taxes must be
arranged. Samples must be reexported within one year if the deposit is
to be recouped. An alternative to placing such a deposit is applying
for an ATA Carnet.
ATA Carnet. An ATA carnet is a special international customs document
designed to simplify and streamline customs entry procedures for
merchandise into participation countries for up to one year. The
initials "ATA" are an abbreviation of the French and English words
"Admission Temporaire/Temporary Admission." Customs authorities in the
United States and France accept carnets as a guarantee that all customs
duties and excise taxes will be paid if any of the items covered by the
carnet are not reexported within the time period allowed. Carnets may
be used for commercial samples, professional equipment, and goods
destined for exhibitions and fairs.
To enquire about or apply for an ATA Carnet, contact the U.S. Council
for International Business:
USCIB
1212 Avenue of The Americas
New York, NY 10036
Tel: (212) 354-4480
Fax: (212) 575-0327
H. Labeling and Marking Requirements
Labeling must provide consumers with precise information which answers
six basic questions about the product:
-- What is it?
-- What is it used for?
-- What is it made of?
-- What does it cost?
-- How is it used?
-- When should it be used?
As labeling is strictly controlled in France, the answers are found in
many regulatory texts.
U.S. firms entering the French market are strongly advised to examine E