How Do I Get Paid (Methods of Payment)
For U.S. exporters, financing export sales is basically the same as 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
- Electronic payments including electronic payment orders, pre-formatted interbank payment orders, electronic commercial trade bills, and electronically processed promissory notes.
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.
How Does the Banking System Operate
The French banking system underwent a fundamental structural reform in 1984, which removed most of the distinction between commercial banks and merchant banks and grouped most financial institutions under a single supervisory system. The largest French commercial banks, such as Credit Agricole-Credit Lyonnais, SocieteGenerale, BNP Paribas, Natixis, Credit Mutuel-CIC group, and HSBC rank among the largest banks in the world. These commercial banks offer all classic financing instruments, including short, medium, and long-term loans, short-and medium-term credit facilities, and secured and non-secured overdrafts. Commercial banks also assist in public offerings of shares and corporate debt, as well as mergers, acquisitions and takeovers. Banks also offer hedging against interest rate and currency fluctuations. France also has 161 foreign banks; some have sizeable branch networks.
The Bank of France ("Banque de France") is a member of the European System of Central Banks (ECSB) and the Banque de France's governor sits on the executive board of the European Central Bank. The Banque de France introduced Euro-denominated banknotes and coins in January 2002, completing the transition to the Euro, and eliminating the French franc.
The Banque de France participates in the regulation and supervision of the French banking and financial system. Its governor is the chair of the Committee on Credit Institutions, which grants or withdraws banking licenses. The governor is also president of the Banking Commission, which ensures that banks adhere to banking regulations. The system also includes two consultative committees, the Committee on Financial Regulation, and the Financial Sector Consultative Committee.
The French government has sold its majority equity stakes in major banks and insurance companies. However, it retains ownership of the Caisse des Depots et Consignations and minority stakes in several major financial institutions. The French postal service, La Poste, an independent public entity, holds 10 percent of the French financial services market. La Poste has created its own bank “La Banque Postale,” which in 2006 acquired the status of a regular bank.
As part of the international effort to combat money laundering and the financing of terrorism, France's banking regulations have undergone several changes, which affect the handling of checks, as recommended by the Financial Action Task Force http://www.faft-gafi.org. France sometimes uses its powers under national law to execute asset freeze orders against terrorists, as well as operating within EU structures. In general, all inward and outward payments must be made through approved banking intermediaries by bank transfers.
Repatriation of Capital and Earnings:
There is no restriction on repatriation of capital provided this is carried out through an approved bank and the investment in question was authorized.
Similarly, there is no restriction on transfers of profits, interest, royalties, or service fees, provided the investment was authorized and made through approved banks.
Foreign-controlled French businesses are required to have a resident French bank account and are subject to the same regulations as other French legal entities. The use of foreign bank accounts by residents is permitted.
France has few controls on the use of foreign exchange. For exchange control purposes, foreigners are considered to be residents from the time they arrive in France. French and foreign citizens are subject to the same rules. Residents are entitled to open an account in foreign currency with a bank established in France and to establish accounts abroad. Residents must report the account number for all foreign accounts on their annual income tax returns. French-source earnings may be transferred abroad, without limitations if carried out through an approved bank.
U.S. Banks and Local Correspondent Banks
All large French banks have correspondent U.S. banking arrangements. Many French banks also have subsidiaries or branch offices in the United States based on Federal Reserve list http://www.federalreserve.gov/releases/iba/:
BNP Paribas: Bank of the West (San Francisco); BNP Paribas (Chicago, Dallas, New York, Houston, Los Angeles, Miami, San Francisco); First Hawaiian Bank (Honolulu); Banca Nazionale Del Lavo (New York, Chicago); BNP Paribas Equitable Tower (New York)
Societe Generale: Societe Generale (Chicago, Dallas, Greenwich, Houston, New York); Societe Generale Private Banking Suisse (Miami)
Banque Federale des Banques Populaires: Natexis Banques Populaires ( Los Angeles, Miami, Houston, New York): http://www.nxbp.fr
Credit Agricole - Societe Anomyme Simplifiee rue la Boetie : Banca Intesa Spa (New York), ; Calyon (Chicago, Dallas, Houston, Los Angeles, New York); Credit Lyonnais (Miami, New York);
http://www.credit-agricole.fr ; http://www.lcl.fr; http://www.caylon.com
For a concise list of information of banks and financial institutions that are AmCham France members, visit one of the following AmCham Service Providers links:
Foreign companies have access to all banking services described in Section A. The other main financing is through French financial markets. The center of the French stock market is the Paris stock exchange (the "Bourse") that is part of the cross-border exchange Euronext. More details can be found in the Investment Climate Section of this report.
Tenders for European Public Procurement Contracts
Tendering for European public procurement contracts:
The U.S. Mission to the European Union in Brussels has developed a tool to help U.S.-based companies bid on public procurement supplies contracts in particular. All contracts for supplies that are procured by European public authorities (national government departments, regional agencies and public institutions, city authorities) above established thresholds are open to U.S.-based companies by virtue of the Government Procurement Agreement, of which the U.S. and the EU are parties. All the tenders in this database are based on a selection of tenders published in the EU Official Journal, that are open to GPA member countries. The database contains on average 6,000 to 10,000 tenders and is updated twice per week.
Links to web sites outside the U.S. Government or the use of trade, firm, or corporation names within U.S. Commercial Service web sites are for the convenience of the user. Such links and use do not constitute an express or implied official endorsement or approval by the United States Department of Commerce of any private sector web site, or of the products or services of specifically identified companies or of any of the private entities that may have contributed to a U.S. Commercial Service web site.