Can you start a small business in a socialist country?

No… you cannot start a business in France. All is controlled by the Government and you need to become a 40 year member of the socialist party first. This is a nuisance to all hard working honest people in Europe, but it seems no issue in France. ;-)

Of course you can start a business in France or in other European countries. you seem to have a warped idea on Europe. Come over and get informed, I’d say.

Socialism isn’t communism. And even in communist states, nowadays people can start their businesses. If you’re not trolling, then please think about your questions a little bit more, before posting.

I’m trolling? no, I’m not.

A friend of mine wants me to move to France with him, and someone else told me I wouldn’t be able to start a small business…but I’ll do some reading on the link you provided.

People get really confused about Socialism and Communism and Marxism. Even people who call themselves Socialists, Communists, and Marxists. What you really need to know is that even in a Communist country you can start a small business. At least in China you can. In Cuba, probably not, but some Cubans are being allowed to run their own shops in markets even though they’re technically not allowed to. Now Socialism isn’t Communism, but then, the Soviet Union was neither Communist nor Socialist, in pure terms. What you really need to know is that France and England are not socialist countries. They are absolutely free market, Capitalist, representative Democracies, pretty much like the U.S. They have better social welfare, which to some extent derives from Socialist principles, and there are some Socialist politicians, as well as Social Democrats, which is a better description of the overall government ideology, and they aren’t as schizophrenic (I know, that’s not a medically correct use of the word) about government intervention as we Americans are, but basically people have every right to open a business and compete in the market just like we do here. There may be laws about what foreign citizens can do and own, but there are laws about opening businesses here too, you just need someone who understands French law to help make sure you get everything set up right.

Sounds like “someone else” is anti-France and, I’m just guessing, listens to Rush Limbaugh and Glen Beck.

no no, my brother told me I couldn’t start a business in Europe, and I just questioned him telling me that….

I’m actually very liberal. I’ve traveled to Germany and the Netherlands before. I would love to live in Europe one day. France seems like a good choice, I hear it’s climate is much like it is here in Ohio, and I hear the health care system is great. I’d just have to learn how to speak French.

It’s possible to have dual citizenship right? Do you happen to know how long it takes for someone to gain citizenship in France?

When I said “someone else” I was referring to whoever told you that (your brother) not to you. You cannot have dual citizenship. Basically, dual citizenship is a quirk in which the citizenship rules of one country overlap those of another (e.g. anyone born to a British citizen is a British citizen, anyone born on U.S. soil is a U.S. citizen, therefore the child of a British citizen who is born in the U.S. has dual U.S./British citizenship). If you get French citizenship through naturalization (which I expect is at least as hard as getting U.S. citizenship), you give up your U.S. citizenship.

nah, my brother is also very liberal, he must have just had the wrong idea about small businesses in Europe then.

I think it would be very hard for you as an American to live in France and start your own business because of their “carte de sejour” requirements (sort of like our green card.) My daughter-in-law is now teaching for the University of Paris and has to apply for that every year. She gets it because she has a job there already. My son has dual British/U.S. citizenship and could work in France because he is a subject of a country that belongs to the EU. I don’t think socialism has anything to do with these requireements; it’s more a matter of whether you could become a permanent resident.

And you can have dual citizenship; but the actual condtions are rather murky and vary from country to country.

I would think your best bet before you make plans to open a business anywhere is to actually go there and check things out. Your problems will more likely to be in not doing research than in govt regs. I am sure in every country there are small businesses even if they are just street vendors or people who sell things they make at home.

Focus on what you want to do not where you want to do it.

France IS a socialist country that had to backpedal and accept that socialism doesn’t work. So we’ve elected two presidents to undo the damage. Unfortunately, once people are hooked on free money that was extorted from “the evil rich”, they don’t want reform to go too fast either so we still have this nanny state and die-hard bureaucracy from hell.

Here are the obstacles to opening a business when you’re not well connected and well funded:

- Bureaucracy: you can’t incorporate in 24 hours and start working. It takes weeks. If you can afford to pay a few thousand euros to have an attorney do it for you, by all means do it.
– You have to pay thousands of euros to the taxman UPFRONT, before you’ve made your first cent, in fact before you can start working.
– Banks don’t lend unless you come up with at least 100% of the money you want to borrow…
– It’s hard to even open a bank account unless you’ve been a faithfull customer for years at a branch.
– Tax returns are longer than a Ghadaffi’s speeches, and having a CPA file and certify your annual tax return for you will cost you over 2000 euros at least (just to give you an idea of what kind of surprises you can expect).

And I’m sure I forget a lot.

Sarkozy is trying to make the whole process less harrowing but france is still a country where business executives and business owners can be taken hostage, even physically assaulted (happened to an American exec for Molex and his bodyguards, and even Sarkozy has to “sympathize” with the hostage takers because he fears a marxist revolt.

The easier for you would be to create a business in the UK, and be the sole owner of that business. The Brits have made it very easy to not just incorporate a business, but operate it as well. Banks lend money, annual tax returns are just 4 pages, a dream.

Then you create a subsidiary in france on behalf of your UK corporation, choosing the EURL legal form (sole ownership but with limited liability). Naturally your UK company has to be sole owner of that french subsidiary.

As owner of the UK corp you’ll naturally be the de facto “gérant” (manager) but you must not have the french subsidiary pay you a salary. You must NOT be salaried nor a shareholder.

Then you won’t have to be registered with the french social security and you won’t have to pay thousands of euros upfront. Later, if your business is profitable you can separate both entities and apply for social security. But you will still face all the other problems.

If your intended business is more like independent work, then there is a new legal status: the auto-entrepreneur. It makes it cheap and easy to get to work. A simple declaration, a quick registration with the tax office and the social security machine, and you’re good to go. But it’s been implemented really recently and there still are undefined questions surrounding it. By the time you make your decision it might have changed drastically, so I’m not advertising it.

My advice… forget this doggone country for at least a few years. London is 100000 times more entrepreneur friendly and brits are far more business minded than the french. Then there’s the cultural thing. At least you have common values with the Brits. It’s hard to adjust to the french mentality when you’ve lived in the US. It’s… different…

@Jack Hass I’ll have to take you at your word that you are French, and I’m sure you are right about some of that, but having a complex bureaucracy and being a socialist country are not the same thing. And at least one of your points must by definition be false (must be a typo): “Banks don’t lend unless you come up with at least 100% of the money you want to borrow” Um, that would mean that banks don’t lend, since no one would borrow money they already have, and if banks don’t lend, banks don’t make any money, therefore no banks. Since there are banks, they must lend, so people must borrow, therefore the statement must be incorrect.

To be clear, I’m not arguing that France is perfect, or superior to anyone else, or even that it is easy to start a business there. It is possible to start a business, and it is not a socialist country. A truly socialist country would not have a major stock exchange. I think the term Social Democracy is better, but it is at heart a free market, Capitalist country, albeit one with greater government involvement than the U.S.

If you watched french news channels you’d frequently hear about the government’s attempts to get the banks to lend money. It’s not a secret. Any regular joe who’s opened a business can tell you that.

Conditions are extremely harsh and unless you are well connected and well funded you will have a hard time even getting a bank to not just lend you money… but even accept to open a bank account for your business… I’m not kidding, I’m not exaggerating, I have owned two french companies. I’ve known people who it happened to and read about similar accounts many times in the papers.

The first time, I was wealthy and well known. Everything was done for me, all I had to do was throw money at people and I didn’t understand what everyone’s beef was with all that french crap everyone was talking about. And yet I only found a bank willing to open an account on the third try.

When it comes to lending it’s obviously much worse. And I stand by what I say because, again, it’s been common knowledge here for decades if not more.: if you don’t have the right connection and you can’t put up the amount you’re trying to borrow as collateral if you can give cash or three times what you’re trying to borrow if you can only put up property and non liquid valuables, it doesn’t matter whether your project is viable or not, you won’t get a loan. Fact: banks in france have a policy of not considering loan applications before the company’s third year of operation, sometimes the fourth.

Again, it’s well known stuff I’ve read about in the news for years and that I’ve experienced for myself and that people I’ve known personally and professionally have experienced. I asked for a business loan and was accepted because I wrote a check for the same amount as collateral. There is a popular saying in france: banks only lend to the rich. I didn’t need the loan so I got it.

Being an entrepreneur in france is like being an actor in Hollywood: a couple people get lucky and met the right people at the right time, a couple others were obvious stars and got a fast track to the big time as soon as they were discovered, but the vast majority are there because of their family connections.

By the way, when you guys try to argue that European style socialism isn’t socialism because it’s not as harsh as Soviet style communism, you’re just doing the Clinton defense all over again. A BJ isn’t the same as intercourse, but it’s still sex.

@Jack_Haas There are 2 different conversations going on here. Your insistance that that Franxe is a Socialist and everyone must agree with you is fatuous. The economies of most industrialized countries are mixed with elements of all theoretical systems.

Anyone’s claim that it is impossible to open a “small business” is equally absurd because the arguments are based on the availability of bank financing and govt support. There may be some businesses that are more risky and difficult to open but that isn’t ALL small business. Right now in the US it might be impossible to open a GM dealership but that isn’t an indication we are a Socialist state.

If you can buy a large house in France you can open a bed and breakfast-a small business. In a village you can open a small shop, bakery or cafe. If you have any savings and you are meeting a need, you can open a small business, That’s what people have always done. The banks don’t owe you a living. If you look back 100 years, most small businesses weren’t up to their necks in bank debt. If you don’t have the capitalization then start a service company that requires little more than your labor.

@galileogirl I answered specifically to Gussnarp’s objection to my statement that banks “don’t lend”. I explained what I meant by that.

I owned businesses in france myself, so how could I claim that it’s impossible to open a small business in france?

However, I don’t know what sort of business the questioner has in mind and the goal of someone who opens a business is to grow it into a big business. Very few businesses can avoid the need to borrow in order to grow. One of the factors making france an anti-business culture is the banks’ landing practices so I have to present these facts. Good luck finding french business owners who would disagree with that.

I don’t argue it’s easy to start a business, and I honestly have no idea what the lending practices of the banks are, but I know for sure that banks will lend money to people who do not have the money, and I know this based on logic. I’m not sure why you took out a loan that you could write a check for, but most people don’t do that. The banks must be loaning money to people who need it or they would not exist because they cannot make any money without loaning any out. You are exaggerating, period.

Dan you should of just asked me, and I can’t believe you listened to your brother on that one (I am the one who wants him to move to france)

Well, here in norway its pretty easy to start a new buisness I belive, depends a bit on the type of buisness and such….. You would need about 20 000$ to register as one of the types of company, but that insures you from losing your money (your money, not the companys) if you go bankrupt.

@Staalesen Most small businesses in the US do not initially incorporate (the equivelent of registering in Norway) for a couple of reasons. First is financial. All their capital goes into starting their business including often mortgaging their homes. Despite what some have said on this thread, banks everywhere are loathe to loan to small business without personal collateral.

Secondly, incorporation means having to follow certain rules and an important reason to open your own business is so nobody can tell you what to do.

@galileogirl Just to be clear, I said nothing about collateral. @Jack_Haas seems to me to be claiming that you have to have the actual cash to get the loan. I’ve no doubt that ALL banks, everywhere, as you have said, require collateral.

I was addressing @Staalesen and we have often seen bank take junk for collateral from the big guys in order show inflated earnings

Not in North Korea.

I think there are two parts to the question:

1. Can a citizen start a small business in a socialist country?

2. Can a foreigner start a small business in a socialist country?

As I said above, I think it would be very difficult for someone who des not have residency status to start a small business in France (which is not a totally socialist country.) And Ithink it would hard to get such status without having a job there already.

I saw a documentary that showed a lot of North Koreans engaged in buying used and surplus clothing and goods in China and transportng and selling them throughout NK because consumer goods are so scarce. People have always traded vas a business whatever the govt says.

Being a socialist country has nothing to do with it. (That term is highly flawed in itself anyway, especially referring to many modern countries like France.)

The difference in entry level to foreign company startups may spawn from countries with social democratic tradition having a relatively generous welfare system in place. They may therefore be more restrictive to foreigners that come and may end up using that system and have limits to smaller foreign companies that do not offer guaranteed sustainability.

France is a !#! to work in as an entrepreneur, but mainly due to their classic labour conditions and organizations and especially their bureaucracy. It is however not a lesser challenge to start a small business in the US, coming from abroad and the US would hardly qualify as a socialist country.

I had assumed the OP was talking about legally and France. Sure, anyone can do anything anywhere otherwise.

@whitenoise I agree with what you’re saying completely.

@mattbrowne North Korea is a Communist country, not a Socialist. There is a difference.