From Wikipedia:
““Money for Nothing” is a single by British rock band Dire Straits, taken from their 1985 studio albumBrothers in Arms. The song’s lyrics are written from the point of view of two working-class men watching music videos and commenting on what they see.”

So many things are happening, especially in the USA, most likely because it is a federal country and different states have very different policies and they are dealing with the pandemic in very different ways.

As far back as I can remember, the US government has never distributed cash in this way because of an economic crisis.

Congress passed the Coronavirus Aid Relief and Economic Security (CARES) Act, which the president signed into law on March 27th. This was a first; it was a big deal and was widely commented on in the media and in Congress. Many conservatives strongly criticized it. The argument that struck me the most, as a Frenchman, was that it was dangerous, inappropriate, maybe even counterproductive to give out large sums of money just like that because times are hard. For American conservatives, it went against fundamental American values.

There were cash payments (technically, tax credits) for individuals and families. Essentially, an individual earning less than $75,000 a year receives $1,200, and a couple earning less than $150,000 a year receives $2,400. Families also receive $500 per child. Individuals and families making more than that receive reduced amounts, up to certain thresholds. Individuals making more than $99,000 and married couples making more than $198,000 receive no cash payment.

The conservatives see welfare, which includes distributing food stamps and unemployment benefits, as a burden on society. At the same time, they argue for a legal right to use the tax code to one’s benefit.

The theme I heard was that if the federal government gives out too much money and for too long, it will weaken the American spirit of entrepreneurship and the self-made man.

I think in the long run it is cheaper to let the businesses of the country remain open. The best way to do that in an extreme crisis is to make sure poor and middle-class people have enough money to pay for their housing, food and transportation – in other words, the basic necessities of life. A family that is evicted, and therefore homeless, does not pay rent to anyone. A repossessed car sitting in a parking lot does not use gas and does not need parts and oil changes. Many other examples, with details that in the course of a normal life we all take for granted, could illustrate my point.

In September 2009, I raised a similar issue about President Obama’s bailout plan, under the title

HOW MUCH IS A CLUNKER WORTH? 
I was again discussing the type of help being offered. The overall amount was considerably less and targeted only the big three American car manufacturers. Here is what I wrote then:

“On one hand, it is clear that subsidies always distort the market and therefore are unfair by their very nature for one reason or another. Furthermore, the negative effects of these subsidies are visible as soon as the programs end because new cars will not sell as well and the sizable drop in sales will hurt the car industry. …
The use of the car is so widespread in the USA and the automobile industry has such an impact on the global economy that choosing this controversial way of spending public money is probably the lesser of two evils. Anything that stops or limits the global recession helps the country. Is there a better way to help the American economy? Maybe, but I have no knowledge of anything better. All in all, good news is coming from the employment front and people have started to say that maybe the crisis will soon be over. Can one be related to another? Again some experts disagree about this. What I noticed was that the American nation is starting to believe that the end of the tunnel is near and this is undoubtedly excellent news for everybody, including the rest of the world.”

Today I would like to make two very different points. The first is about the French system of subsidies to individuals regardless of the pandemic. Most of the payments are issued by the Caisses d’Allocation Familiales (CAF), a program that originally provided families with financial support during pregnancy and the first three months of a child’s life. The CAF now has 18 programs dealing with four major situations:

• Petite enfance – infancy
• Enfance et jeunesse – childhood and youth
• Logement et cadre de vie – housing and living conditions
• Solidarité et insertion – solidarity and economic integration

In 2017, the CAF provided payments totaling 73.2 billion euros. Almost half the French population receives some subsidy from the CAF. The French as a nation recognize the need to help certain categories of people. Culturally there is no stigma attached to receiving such subsidies, especially payments other than theRevenu de Solidarité Active, (R.S.A.), which is the equivalent of income assistance. Consequently, the decision to have a stimulus plan somewhat similar to the US one was not criticized, and the French administration knows exactly how to do this. Furthermore, because France has universal health coverage, requirements to wear a mask, get tested or go to a hospital involve little cost to individuals and no one has to wonder how much it will cost, and whether the patient can pay or what services are covered.

My second point concerns the cost of the economy collapsing. There are always those who will criticize any government financial involvement in the private sector and in people’s lives. I understand and respect the fact that this makes perfect sense for a certain type of morals or ethics. The American Republican Party has long held such views. It also favored controlling and limiting public spending, which again makes total sense in that context.

Anyone who works in social services, either as a profession or with a non-profit organization, such as the Salvation Army, quickly realizes how much it costs a country to support people who become homeless and destitute. One consequence is that they are no longer consumers who can sustain the economy with their spending; they have no money because they have no jobs worth talking about. Within just a few days of being evicted, the average person who becomes homeless is broken so severely that it takes years to get them back into normal society. But people who keep their home and receive enough public money that they do not have to worry about being evicted can work on getting a job, sending applications or preparing to launch a new business. When the worst of the crisis is over, they are ready to get back to work regardless of what they do. In terms of just contributing to the IRS and Social Security, subsidizing part of the population for a short period costs relatively little, given how much they will contribute later on.

Thus there is no such thing as “money for nothing” in such situations. The money enables people to keep their dignity and their ability to work and contribute. Maybe instead of rehearsing financial and economic reasons to choose this or that policy, we should ask what it takes to treat a country’s population with respect and understanding of their needs. On several occasions, the US presidential campaign has brought up this issue as a topic of discussion.

Criticizing “Money for nothing” and stating “the state is infringing my constitutional right to freedom” are, to me, two sides of the same coin.

This opens up a new discussion in view of the pandemic that is sweeping the USA. Maybe it is time to put people’s lives first when political decisions are being made.

PREFECTURES REMAIN CLOSED; THE VALIDITY OF FRENCH IMMIGRATION IDs IS EXTENDED FOR SIX MONTHS
All prefectures in France have been closed since March 17th. Cartes de séjour, récépissés, visas,autorisations provisoires de séjour (APS) and so on that expired or will expire since then have had their validity extended for at least six months. When the system reopens, all those expired documents will be considered valid and procedures will resume as usual.

The extension went into effect on April 22nd in application of Article 16 of the emergency law dealing with the Covid 19 epidemic. So far it concerns all of the following documents that expire(d) between March 16th and May 15th:

• long-stay visas
• residence permits (mainly cartes de séjour) except diplomatic ones
• carte de séjour RESE « Recherche d’Emploi / création d’Entreprise » previously called student APSAutorisations Provisoires de Séjour
• récépissés

OVERSTAYING THE SCHENGEN PERIOD BECAUSE OF THE VIRUS 
I have helped many US citizens who have overstayed the three months they are allowed to be in the Schengen area. They often get fined or have to miss their plane and therefore get stuck for a while in another Schengen country. French officials, especially the Charles de Gaulle Airport police, have always given lenient treatment to US citizens who overstay, even several times. I am sure this leniency will continue in May, as the crisis situation evolves both in France and in destination countries.

Since airlines cancelled almost all flights because so many countries, including France, shut their borders, foreigners with tourist status, whether a short-term visa or visa-free entry, often could not leave France on time. For some, overstaying would have few effects, as mentioned above. But others could run the risk of serious consequences, such as criminal prosecution and being banned from re-entering France for several years.

To avoid this, the Paris prefecture has created an email address where people can ask for an official document a few days before their legal stay ends, allowing them to legally leave France at the end of the lockdown (note that this is specific to the Paris prefecture). The request, sent to pp-dpg-sdaeprolongationvisa@interieur.gouv.fr, must include scans of the following documents:

• the ID page of the passport and the page that was stamped upon entering France
• if applicable, the C tourist visa issued by a French consulate, expiring in less than a week
• proof of accommodation in Paris (e.g. copy of hotel reception certificate or affidavit of lodging –attestation d’accueil)
• proof of your difficulty in returning to your country of origin.

FRENCH INCOME TAX: THE TIME TO DECLARE HAS BEGUN
Regarding the more mundane topic of income tax, I would like to remind everybody that paper versions of the 2019 income declaration must be filed in France by June 12th 2020 midnight. The declaration forms are available at www.impots.gouv.fr. You can file your declaration on the same website, unless it is your first time, in which case you must file on paper. To file online, which has been possible since April 20th, you need your tax ID number and some access codes.

Note that if you file online, the deadline is later. The schedule depends on your postal code:

• départements 01 to 19 must file by midnight on June 4th.
• départements 20 to 49 by June 8th.
• départements 50 or higher by June 11th.

An important reminder: If you are a French fiscal resident (i.e. if you hold a carte de séjour or an immigration visa validated with an OFII stamp, and comply with the requirements), you must declare your worldwide income to the French authorities even if you have no income in France and do not have the right to work in France. There is no penalty for neglecting to file, but not meeting this obligation is illegal and can have consequences.

You are a French fiscal resident if you: 

• stay in France 183 days in a calendar year, whether you have legal immigration status or not
• have immediate family members (spouse and/or minor children) living in France
• have a French employer
• run a French business, even something like tutoring schoolchildren in English.

Current government-sponsored advertising campaigns refer to paper forms as thing of the past. For now, declaring electronically gives you an extension of a few weeks.

Some foreigners neglect to declare their worldwide income to France. Some of them hold a student immigration status, and think that this obligation does not apply to them. Some of them hold the ‘visiteur’ immigration status and think that the prohibition to work included in this status, prevents them from declaring to the French tax office. After all, why declare your income to France when you are prohibited from earning money in France? When they realize their mistake, they wish to file for the last three years as the statute of limitations for this kind of fiscal issue allows it.

What infuriates me is that I have recently seen a trend in which tax offices in the Paris region systematically refuse declarations that they considered too old. Thus, in 2020, one can declare income for 2019, 2018 and 2017. But many of my clients who have tried to declare three years at once have had the filing refused on the grounds thatvisiteur immigration status, even with proof of a stable long-term address in France, is not enough to be considered a fiscal resident. In one case, the tax inspector took up an entire A4 page detailing why such status could not be accepted for a single American man who had lived in France for a decade. The letter listed all the reasons this client did not fit in but purposefully “forgot” the criterion of staying physically in France for a minimum of 183 days. And yet declarations that are not filed late, even the first ones done on paper, go through the system and create no problem.

Keep in mind that to request a carte de résident, you have to have, among other things, proof of five years of fiscal residence, which requires the avis d’imposition sur le revenu.

HOW THE PANDEMIC AFFECTS SCHEDULING OF CO-OWNER GENERAL MEETINGS
The annual assemblée générale (general meeting) of a copropriété (property co-owners) must be held in order to vote on at least two things: the budget, and the amount the co-owners will pay; and the contract with the syndic (property management firm). Normally the meeting must occur no more than six months after the books are closed. As that generally takes place on December 31st, the meeting must be held by June 30th.

Because of the lockdown, however, many meetings could not be held, so a special regulation has been issued. Any meetings scheduled before March 14th should have been held and thus are not affected, but any meetings scheduled after that date will have been cancelled, and the new regulation applies. The syndic will not be allowed to call the meeting until after the government declares the health emergency over, allowing meetings again.

These two regulations, the ordonnance n° 2020-304 issued on March 25th 2020, then modified by the Ordonnance n° 2020-460 issued on April 22nd 2020, very exceptionally authorized these meetings to be held until the end of this year.

THE NAVIGO PASS WILL BE REIMBURSED IN MAY
A website will be launched in early May on which holders of the Navigo transportation pass, which costs 75.20 euros a month, can request reimbursement for April and the first part of May. The same will apply for the 37.60-euro senior and ImaginR student passes. Since most employers already pay half the cost of the Navigo, this will boost the spending power of many local residents. The reimbursement will also apply to teleworkers, employees on partial or complete unemployment, and self-employed people who have had to close their business.

www.service-public.fr/particuliers/actualites/A14010

GOVERNMENT HELP FOR SMALL BUSINESSES AND INDEPENDENTS 
As is often the case, the French system takes people’s real financial situation into consideration when deciding what assistance they receive for losses incurred because of the pandemic. This means that to obtain this financial help, independents and small business owners have to fil out a form documenting their financial loss.

Since the conditions are rather complicated, here is a link to a site that explain them:
https://www.secu-independants.fr/action-sociale/aide-coronavirus/

SUMMER VACATION: THE OFFICE WILL BE CLOSED JULY 17th to AUGUST 24th 
The office will be closed for one month, starting Friday, July 19th, reopening on Monday, August 24th. As always, I will be reachable by e-mail for emergencies and important matters. My service of receiving mail for clients will continue while the office is closed.

MY MINOR FEES WILL INCREASE ON SEPTEMBER 1st, 2020
Handling mail in my office: 40 euros per month
Handling mail received at my home: 50 euros per month
Surcharge for out-of-the-office meetings: 60 euros which corresponds to less than 30 minutes’ transportation
Surcharge for meetings and phone calls at the client’s request after 7PM weekdays, all weekend and during national French holidays and vacations: 30%.

Best regards,

QUESTION

WHEN A NON-PAYING TENANT HAS A GUARANTOR

I live in the USA and I own an apartment in the 7th. My tenant chosen by the agency has not paid the rent for over six months. My tenant is a young single mother. About a year ago, she asked me to certify her payments for allocations familiales/aide au logement and I signed the form and kept a copy for myself. The owner of the agency met with her last week and confirmed that the tenant does not have the means to pay the rent. The baby and Covid 19 are hurting her business really badly. But I cannot continue hosting them for free! The lease agreement is for a furnished apartment as a primary residence. The debt is now 12,500 euros. At the time of signing the contract in late 2017, I asked for a guarantor and I have documentation relating to a lady who I assume was her employer at the time.
Given this picture of the situation, please clarify: 
What is the eviction practice in France in these situations? Approximately how long will it take to get the apartment free again?
What action do you suggest I take against the guarantor? Is the guarantee subject to a time limit?
Is it possible to check the condition of my apartment? (I fear for my paintings and furnishings.)
I need a definitive solution fast, as I need this money.

QUESTION

INSURANCE CLAIM WHILE RENTING AN AIRBNB-TYPE PROPERTY

I managed to rent a large studio, through an agency in Paris and I have learned that it is a vacation lease signed with the owner. The reality is that the agency does not manage the lodging. As the middleman, it communicates with the owner, and deals with my numerous grievances. Today I found a small leak behind the faucet of the shower in my bathroom. I let a plumber in and the repair was done in 5 minutes. There was no visible damage to my apartment. There was some damage downstairs. The agency representative asked me to complete the damage report with the downstairs neighbor, and told me that I have had a policy in my name, purchased by them when the lease was issued.

What should I do next? The owner has insurance and the agency has insurance, and they say this policy is in my name. The owner seemed to infer that I do not need to worry about it. It would be a huge issue if I was made to pay for the damage done to the apartment below, because I have no idea what the neighbor downstairs is going to claim.

ll the leaves are brown (all the leaves are brown)
And the sky is grey (and the sky is grey)
I’ve been for a walk (I’ve been for a walk)
On a winter’s day (on a winter’s day)
I’d be safe and warm (I’d be safe and warm)
If I was in L.A. (if I was in L.A.)
California dreamin’ (California dreamin’)
On such a winter’s day
Stopped into a church
I passed along the way
Well, I got down on my knees (got down on my knees)
And I pretend to pray (I pretend to pray)
You know the preacher like the cold (preacher like the cold)
He knows I’m gonna stay (knows I’m gonna stay)
California dreamin’ (California dreamin’)
On such a winter’s day
All the leaves are brown (all the leaves are brown)
And the sky is grey (and the sky is grey)
I’ve been for a walk (I’ve been for a walk)
On a winter’s day (on a winter’s day)
If I didn’t tell her (if I didn’t tell her)
I could leave today (I could leave today)
California dreamin’ (California dreamin’)
On such a winter’s day (California dreamin’)
On such a winter’s day (California dreamin’)
On such a winter’s day

The song “California Dreamin’,” by John and Michelle Phillips, was first recorded by Barry McGuire in 1965, with backup vocals by the Phillips’ quartet, the Mamas & the Papas. They released their own version as a single the same year, and it became by far the bigger hit.

Among French people, especially those who have dreamed of moving to the USA, California has an iconic status, that sets this state aside from the rest of the USA. It has always been the land one dreams about. In May 1970, the French singer Julien Clerc released “La Californie,” which became a long-lasting hit. It is safe to say that as far back as one can remember, the state of California has nourished dreams of an unattainable better life for much of the world. This separation of the state and the nation in the popular imagination of the rest of the world, is something many Americans themselves have a hard time understanding.

The results of the midterm elections in a lot of the country were favorable to the Democratic Party. It is interesting to note that the state of California is heavily Democratic. So, for some people the election results were reason to rejoice, enabling them to dream that a better future is possible. California has also long been a magnet for people living in other states – and still is, for political reasons as well as well-paid job opportunities. California dreaming, dreaming California is still today, a real thing.

As I write these words, however, wildfires are destroying homes and killing people, and California is weeping over these deaths and other losses. This is a time of mourning. One could hope that such destructive fires will not happen again, but climate change is going to make it more difficult. In much of the USA, it has been really cold. It feels like winter already when one celebrates Thanksgiving with thick snow on the ground. What makes the fires even scarier is that they should not happen when it is that cold.

I could dwell upon the leaves being not only brown but burned to ashes, about the sky being grey and people suffocating from the heavy smoke. But rather than twirling with these lyrics, I pay my respects to the victims of the blazes, especially people who lost their homes, their businesses, a loved one. We should pay attention to them, helping them rebuild their lives and giving them a reason to dream of a better future.

As long as I can remember, I have loved “California Dreamin’,” and still often listen to the albums of The Mamas & the Papas.

HOW CAN THERE BE A FRENCH BLACK FRIDAY?
I already wrote about this last year, and this year is even worse in terms of the advertisements we are being bombarded with about huge sales only on Black Friday. It reassures me a little (but not much) that many French outlets promote Black Friday week, which indicates to me they have a poor understanding of what Black Friday normally means. I also find recent developments regarding the Thanksgiving celebration to be interesting. I cannot imagine the USA going through the season of fall without celebrating it. At the same time, I look with great interest at the fact that the narrative of Native Americans is being heard more and more, and that this celebration is unsettling, to say the least, for them.

FROM MY DECEMBER 2017 ISSUE:
“I was feeling completely exasperated at seeing ‘Black Friday’ advertised everywhere in France (in English!). I wondered how many of people would even know what it referred to. How can you have a ‘Black Friday’ if you do not celebrate Thanksgiving on Thursday? The adoption of this term is totally insane and I believe it illustrates 100% bad taste consumerism. In the USA, many consider ‘Black Friday’ offensive for various reasons, a tendency that has grown with every passing year. Some believe this is insanity in consumerism, citing the craziness when crowds – I would call them hordes sometimes – enter the shops. Others focus more on the idea that family life should take precedence over consumerism, as the day after Thanksgiving is usually a de facto national holiday. There are other criticisms, but I see particular merit in those two.

“France does not celebrate Thanksgiving, and this holiday, unlike some others, cannot be easily exported, as it is part and parcel of the iconic history of the birth of the USA and the infancy of an early settlement in the New World.”

RETENUE À LA SOURCE – INCOME TAX WITHHOLDING STARTS ON JANUARY 1st 2019
I attended a seminar on this topic given by my French accounting firm, as it is now certain that it will go ahead. I would like to explain in a basic way how it will happen.

We could have feared the worst from the French administration, since the deal was locked, sealed and delivered this past September after countless months of indecision.

First, the good news, which shows there have been some significant improvements.

The provision that employees feared most was that their family information would need to be shared with the employer. This is not happening: only the tax office will be informed. It used to happen once a year, when the declaration was submitted. But now, since this information immediately affects the bracket used to calculate the amount of tax owed, the individual must inform the tax inspector as soon as possible. This is a huge relief. It is interesting to see that in France, the tax inspector is more trusted and seen as less of a threat than the employer – a situation that is impossible to explain in only a few words. Just remember that the tax inspector is a free adviser when tax season comes, and an impartial helper.

The other good news is that independents will pay monthly by automated withdrawal, and the amount will be based on what was owed the previous year. The administration has promised that any reported change will be taken into account, and the amount of the payment changed, as quickly as possible. It remains to be seen how quickly that will actually be.

The same rule applies for rental income and other types of revenue that an authority cannot withhold directly.

A NEW IMMIGRATION LAW HAS BEEN PASSED – SOME GOOD NEWS
To obtain employee immigration status, one must be awarded the right to work as an employee. A new law grants this right to all of the foreigner’s potential employers, rather than to just one specific current employer. Previously there was a risk of losing this right when the foreigner changed employers within three years.

Another good thing is that the travailleur temporaire status and designation mentioned on the carte de séjour has been done away with. The evolution was such that it was issued when the foreigner had a contrat à durée déterminée, a short-term contract with a beginning and ending date. Now both labor contracts, the CDD and the CDI, grant the right to obtain the “salarié carte de séjour”. We will see if DIRECCTE issues the same number of authorizations and implements the law with the right intent, or if some short-term contract holders will be refused, when they would have been accepted under the previous law.

A further good thing is the disappearance of the autorisation provisoire de séjour for recent graduates transitioning to work either as an employee or a self-employed person. It has been replaced by a true immigration status called titre de séjour temporaire « recherche d’emploi ou création ». This should reassure employers and facilitate the job search.

Now almost all the remaining bad news concerning immigration is about refugee procedures.

CRIMINAL FAKE MARRIAGE – ULTERIOR MOTIVE MARRIAGE
I never try to guess which couple will last and which will not. There is no way to be sure, and we have all known what appeared to be the perfect couple who ended up getting the nastiest divorce. Because of my work, I often deal with couples where one is an undocumented alien seeking to obtain a legal stay through marriage. That puts a huge strain on the couple if it is not properly handled. It gives one spouse considerable power over the other, as the couple must stay married three years before the foreigner can retain legal residence in France. I have often seen the foreign spouse effectively blackmailed. The other distortion is that the foreign spouse may disappear once the immigration status is achieved for good, giving the impression that there was no love and it was just a scam to stay in France.

Completely aside from the immigration issue, multicultural couples have a much harder time staying together, as it is harder for them to establish the common ground needed for a long-lasting relationship. At the same time, the traditional view of marriage lasting forever is shared by fewer and fewer people these days. In major cities of Western countries, half of all marriages end in divorce, with multicultural couples representing only a tiny minority.

The video linked below is ten years old, and I know the administration has strengthened its controls and now does more investigation to uncover what French officialdom considers fake marriages. It is not just a matter of foreigners paying a large sum of money to get married and obtain a legal stay; that is a felony, for which people go to jail. But there are also couples where clearly the foreigner is not involved in the relationship as someone in love, when the other one seems to be. I liked the comment the policewoman made about the Moroccan woman and the Frenchman wanting to get married. She understood the motivations of each of them, and she seemed to care about both of them, but at the same time she had to apply the law and definitively block the wedding, leaving the Moroccan woman in a precarious situation.

FRENCH CONSULATES WILL NO LONGER OFFER NOTAIRE SERVICE
Starting in 2019, French consulates are dropping the notaire service they used to provide. This might not seem like a huge loss to most of us, but it is for countries in which such a service is not offered privately. It is a big deal in countries where there is no other way to verify the signing of an official document. In such countries, it was a real service that was badly needed: the consular notarization enabled, for instance, real estate transactions to occur in France without the person having to go to France. Throughout my career I have seen more and more transactions done this way. Since the clients are almost always Americans and French notaires often accept notarization by an American notary public, this is a reasonable alternative. Yet even today, I think many rural notaires would not accept such notarizations, as they are not done according to French procedure.

https://frenchmorning.com/notariat-consulaire-supprime-a-partir-de-2019/

FRENCH BAILIFFS SEIZED A RYANAIR JET OVER AN UNPAID DEBT
Here is an excerpt of an article I found on the website www.thelocal.fr:
“French authorities said on Friday they seized a Ryanair plane, forcing 149 London-bound passengers off the aircraft, to get the Irish low-cost airline to repay illegal public aid, the latest in a string of troubles for the carrier.

“Claiming that Ryanair owed them 525,000 euros ($595,000) in subsidies wrongfully paid out to the airline, the authorities sent in a bailiff under police protection on Thursday to seize the plane on the tarmac of Bordeaux airport as it was readying to take off for London Stansted.

“Just under 24 hours later, the no-frills airline relented and paid up, authorities said Friday, allowing it to reclaim its aircraft.”

The French word for bailiff is huissier and when you see a document from them or when they knock on your door, you need to pay attention. Sometimes it is empty threats, but other times they have the power to confiscate things and sell them at auction when a debt has not been paid. Grounding an airplane to get a debt paid is rare, which is why it made the news.

https://www.bbc.com/news/business-46152849

I would like to remind everyone that there is no January issue.

I would like to wish you all
A MERRY CHRISTMAS AND A HAPPY NEW YEAR
I am looking forward to the year to come, 2019.
Like many, I feel that 2018 was a very hard year, and
I lost a lot of sleep trying to follow everything that was going on.

Best regards,

QUESTION

REGISTERING A SMALL BUSINESS – AUTO-ENTREPRENEUR

I wanted to ask you some more about auto-entrepreneur status. I have found that there are many different methods for obtaining auto-entrepreneur status (micro-enterprise, etc.). I’m not quite sure why I would get caught, since this status is completely legal. Any information you can give would be greatly appreciated as I’m finding mixed opinions.

QUESTION

WHO PAYS THE PREMIUM FOR PUMA COVERAGE?

Is an American resident of France who receives US Social Security retirement benefits required to pay the cotisation supplementaire maladie under PUMA?

From Wikipedia
“Sometimes I Feel Like a Motherless Child” (or simply “Motherless Child”) is a traditional Negro spiritual. It originated during the era of slavery in the United States. An early performance of the song by the Fisk Jubilee Singers dates back to the 1870s.

The song is clearly an expression of pain and despair conveying the hopelessness of a child who has been torn from her or his parents.

“Sometimes I feel like a motherless child
A long way from home, a long way from home”

Negro spirituals and some gospel songs say a lot about the suffering the slaves in the USA endured. Today they are usually sung by choirs, and too often we enjoy the concert, the performance, the beauty of the music, and overlook what the lyrics meant to the people who created these songs. It has always fascinated me to see large crowds of French people listening to this music, knowing next to nothing about the lyrics and what they convey.

This might explain why so many African-American musicians, particularly jazz and blues performers, moved to Europe and especially France. This began as early as 1925 with Josephine Baker.

Longing for home is very common among people who emigrate to a different country. The farther away they are from home, the more painful this feeling is.

Clearly the title can be linked to the topic that follows, concerning the fact that the majority of French children are born out of wedlock. When I discussed this topic with my two children, their response was that the term “out of wedlock” does not mean anything, and should be changed. They were trying to find something that would mean “children born of a stable relationship.”

I believe the title can resound further with almost everybody, especially those who have lost their parents.

THE MAJORITY OF FRENCH CHILDREN ARE BORN OUT OF WEDLOCK
When I first traveled to the USA in 1980 and 1981, and during my later stay when I got married in 1986 and lived there several years, I was surprised by the large number of teen pregnancies. The expression “babies making babies” was commonly used. One day I looked at France and saw that a growing number of children there were born out of wedlock – although the cultures of the two countries in this respect are quite different. There are several reasons for that – I would like to explain them before discussing the results of recently released data.

For a long time, almost 60 years, fewer and fewer people in France have been getting married, to the point that the legislation needed to change to follow this evolution.

1 –From the mid-1970s, city halls started to issue increasing numbers of certificat de concubinage. A couple would go to city hall, state that they were living together, and walk out with an official statement that could be used to obtain benefits that otherwise only spouses could get.

2 – The kinship law of January 3rd 1972 erased the legal difference between children born within marriage and those born outside of wedlock, as long as neither parent in the latter case was married to someone else.

3 – The PACS law of November 15th 1999 established the pacte civil de solidarité, which quickly became almost a carbon copy of the institution of marriage.

With the French state officializing stable non-married couples and giving them strong legal status, more and more such couples are having children without being married.

Teen pregnancy is virtually non-existent in France, and children are almost always born to a stable couple.

In 2017, almost 6 children out of 10 (59.5%) were born outside of marriage. In 2007 such children were already the majority at 50.7%. These numbers were published by INSEE, the French National Institute of Statistics and Economic Studies, on September 4th 2018.

The numbers indicate that churches have almost completely lost their influence on the general population, as one must be married at city hall before having a religious ceremony. It is clear that France is a secular country and can no longer be called a Catholic country. Of course, these percentages include French Muslims. However, since France does not allow data studies to be based on ethnicity or religious affiliation, it is impossible to know how many Muslims get married, and how many of these ceremonies include religious rites.

There were 228,000 weddings celebrated in France in 2017, around 5,000 fewer than the year before. Some 192,000 PACS were recorded in 2016, up 3,000 from the year before. The numbers say it all – the trend is obvious. This clearly explains how it was possible to have 6 out of 10 children born out of wedlock in 2017.

Several years ago, I met a couple who showed that the numbers were not telling the entire story. He was French, born in France of two parents from the same African country. She was from that country as well. They chose to be PACSed rather than married. But the young woman told me she had waited to be PACSed before moving in with the man and consummating the relationship, as she was an honorable woman.

I have encountered many similar situations where the couple mixes very traditional values with choosing a PACS over marriage. This puts back in perspective the variety of choices hinted at in the title, especially for people who are not used to the French situation, which is after all not an oddity. It is just people adapting to situations and making their own decisions according to the law of the land.

https://abonnes.lemonde.fr/les-decodeurs/article/2018/09/04/six-enfants-sur-dix-naissent-hors-mariage-en-france-un-record-en-europe_5350153_4355770.html

EMPLOYEE PROTECTION IN FRANCE HAS A LIMIT
French labor law is extremely protective in favor of employees. This is well known, and the scariest tales heard in the expat community have some truth in them. But recent laws sought by Economics Minister Emmanuel Macron and achieved by President Macron are taking away some of this protection. A recent court decision sheds some interesting light on this issue.

A sales representative had a company car and pretty much had all of France as his territory and therefore drove a lot. He registered with the Blablacar site to drive people during his working hours. Blablacar provides carpooling, which ensures that more than one person is traveling in a car, reducing the need for others to have to drive themselves.

The initial problem was that the car was insured only for his own use when he was using it on company business. Therefore, his action constituted a violation of the labor contract.

On top of that, even though the car did not cost him anything, he was asking for cost sharing and a tad more, which ended up making him a substantial profit – several thousand euros in a couple of years – which Blablacar does not allow.

The employee argued that the fact that his participation in Blabla-carpooling did not cost his company any extra, and therefore it had no grounds for firing him.

The Rennes Court of Appeals in August 2018 struck down the decision by a lower court in Nantes because he had driven the car in violation of his company’s insurance policy and therefore his employer’s guidelines, and because he made a profit, which did not comply with Blablacar regulations.

The usual argument that “it does not hurt the employer” does not work as well as it used to.

https://www.lemonde.fr/economie/article/2018/09/06/les-prud-hommes-deboutent-un-salarie-licencie-pour-covoiturage-avec-une-voiture-de-fonction_5351321_3234.html

THE PARIS BRANCH OF OFII HAS MOVED
Since I started my business over 20 years ago, I have seen this division of the French administration change its name many times, since it felt like each president wanted to fix the immigration problem once and for all. The office now called OFII (Office Français de l’Immigration et de l’Intégration) has several functions:

(1) It is probably best known for the mandatory medical exam for people who come to France with a visa.

(2) In the procedure of an employer hiring a foreigner living abroad, OFII carries out the second round of investigations before sending the file to the designated consulate.

(3) In the family reunification procedure, when a foreigner sponsors a spouse and/or minor children to come to France, it carries out the initial strict investigation.

(4) It also introduces visa-holders to France, showing them an explanatory movie and testing their ability to speak French, find a job and so on.

The office used to be located at 48 rue de la Roquette in the 11th arrondissement, near the Place de la Bastille. The new location opened on September 25th at 83 rue de Patay in the 13th. It is now quite far from a metro stop, and is closest to the Bibliothèque François Mitterrand and Olympiades stops.

My guess is that this will not fix the problem of the office personnel being overworked due to the number of asylum seekers who need appointments. I have not heard feedback yet, but I will make sure to let people know how it goes.

VFS GLOBAL, A NEW PLAYER IN THE FRENCH IMMIGRATION PROCEDURE
From Wikipedia:
VFS Global is an outsourcing and technology services specialist for governments and diplomatic missions worldwide. The company manages visa and passport issuance-related administrative and non-discretionary tasks for its client governments. It is based in Dubai.

The company operates in 139 countries on behalf of its 60 client governments. It has processed over 180 million applications since it commenced operations in 2001.

There are two very different issues here I would like to raise.
1 – For the foreigner, it complicates the procedure and increases the risk of getting the wrong visa. The request for the visa is filed online but VFS does not gather enough information about the exact reasons for the visa request to ensure that the visa hoped for will be the one received. I have been seeing people who went through this procedure and thought they asked for a visiteur immigration visa but instead received a one-year non-renewable one because they chose “up to one year” instead of “more than one year.” The latter is needed to obtain true immigration status that can be renewed by the prefecture a year or so later.

2 – For the government, it means trusting a private foreign corporation to handle a national security matter. Controlling the borders includes dealing with those coming into the country with a visa. French civil servants, i.e. the French administration, have a mixed reputation but most people agree they take pride in doing their job to protect the nation’s interests. The fact that this attitude can sometimes lead them to treat private individuals with contempt does not negate this point. So hiring a private company whose employees are just there to do a job does not reassure me when it comes to those employees completely reviewing a file and understanding the nature of the request. It really feels like paper pushing. All the approved requests go to the French consulate in Washington for the visa to be issued.

A reader sent me a link to a site rating this company. Its score was 2 out of 5. Many of the negative comments sounded familiar to me. Even clients of mine who got their visas recently have not been impressed by the quality of the service. In the most striking case, the address for the meeting was wrong because VFS had moved without informing the people who had appointments.

www.trustpilot.com/review/vfsglobal.com
https://en.wikipedia.org/wiki/VFS_Global

CPAM IS NOW TIGHTENING PUMA REGISTRATION AND COVERAGE
President Macron has stated a few times that the Assurance Maladie should do more to keep people who do not live in France from abusing the system. I have seen this happen; sometimes it is people do not know they are breaking the law, but others know the regulations very well. The Assurance Maladie covers only residents of France.

Thus, alongside PUMA coverage, we have seen a growing effort to identify users who do not live here but have their medical check-up when they come to France on vacation.

First CPAM suddenly refused to register foreigners with visiteur immigration status. This lasted several months until the rule changed and these foreigners regained the right. Then came a hassle in obtaining coverage for people who could not prove they had been living in France for the previous three months. The immediate assumption was that they were not residents, even people who had their immigration visa, the OFII stamp, and utility bills in their name. Such scrutiny has decreased significantly, but proof of residence from several sources is still required. Therefore, if you are one of those affected, be ready to bring your lease, rent receipts (quittances de loyer), utility bills and Internet provider bills for the last six months. If you have children in school, bring their school registration statement.

The latest development is that some foreigners are receiving very detailed questionnaires asking their whereabouts. One of my readers writes:

“The letter was received at the beginning of this week – which is not only the middle of the vacation period but includes the August 15th holiday – demanding the return of a dossier within three weeks, without which the rights to health coverage will cease and steps can be taken to recover medical expenses already paid.”

Though the vast majority of PUMA beneficiaries are French nationals from birth, it seems they will also need to prove residence in their native country each year.

There was also apparently a request to furnish a RIB in the name of the individual person, even though couples often have joint accounts. The points is that Sécu accounts are now individual. It is not clear whether the submission of a RIB in the name of the individual was optional.

I am attaching the complete letter for those who are interested.

Best regards,

QUESTION

INSURANCE COVERAGE FOR FRENCH SMALL BUSINESSES

I am an American who teaches in France with auto-entrepreneur status. My most recent client demands proof of insurance. Have you any thoughts on that? It is a bilingual school, and the manager wants me to have two separate types of insurance – one for working with children and the other for being in the actual school building. Both are very expensive and I honestly do not understand the need for two policies. Can’t I have just one insurance policy that covers me for the work I do wherever I do it? Do you have an insurance company you recommend?

QUESTION

FRENCH HEALTH COVERAGE AND BREXIT

I am British, married to an American. I understand that because of Brexit, we wil find it very difficult to get health insurance when we move to France. She received a liver transplant twelve years ago, and recently was successfully treated for hepatitis C. Am I right in my understanding or do we have to wait to see how the EU treats the Brits in the coming months?

QUESTION

IS A STUDENT IN FRANCE A FRENCH FISCAL RESIDENT?

I am an American who recently received a two-year student visa and now hold the OFII stamp. I arrived late April 2018. I have several questions to which I cannot get a straight answer:
Am I subject to French tax (income or other)?

1. If I am subject to French income tax, what is the trigger and can it be avoided?
2. Does opening a bank account in France have any impact on the answer to the first question above?
   I ask because HSBC is telling me to fill out an auto-certification tax form, and since my HSBC account is linked to my new French address, my banker is saying that the country of tax residence (currently USA) needs to match the address and be in France as well. This doesn’t seem right, considering I am just on a student visa.
3. I want to continue filing my taxes in the USA. If I cannot escape French taxes, do you think it’s best that I find a French accountant?

I ask because HSBC is telling me to fill out an auto-certification tax form, and since my HSBC account is linked to my new French address, my banker is saying that the country of tax residence (currently USA) needs to match the address and be in France as well. This doesn’t seem right, considering I am just on a student visa.

I want to continue filing my taxes in the USA. If I cannot escape French taxes, do you think it’s best that I find a French accountant?

From Wikipedia
“Won’t Get Fooled Again” is a song by the English band The Who, written by Pete Townshend. It was released as a single in June 1971, reaching the top 10 in the UK, while the full eight-and-a-half-minute version appears as the final track on the band’s 1971 album Who’s Next, released that August.
This iconic song has swept a complete generation in the 70’s. Today its message can be interpreted in very many ways. The idea is that everybody lies and cheats; politicians, medias, the corporate world, bosses, spouses, … It has reached the point where it feels like that there is a conspiracy theory for just about everything.
At the same time, crooks have perfected their methods and phishing is only one ways in which their prowess is revealed. We are now living in a world where we need to be cautious just about all the time. This changes the way we live and many people become suspicious of everything, and expect the worst all the time.
This issue deals for the most part about not delivering what has been promised. A foreigner is always an easier prey. Since everything seems weird, it is very difficult to discriminate between cultural differences and being taken advantage of. It is easy to state “Won’t Get Fooled Again” when we get mad after finding out that we have taken for a ride. We blame ourselves for not having being vigilant enough.

RAPID CHANGE IN HOUSING IN THE PARIS REGION
I have heard very few people commenting about a phenomenon that is visible all around Paris. While Paris proper is slowly losing population, its suburbs continue to grow faster than the French population as a whole. This means many people working in or near Paris are living farther and farther away. I saw a similar situation firsthand in greater New York, where people work in Manhattan but live far away in New Jersey and Connecticut. The small town where I grew up in Paris’s southern suburbs, about 20 miles from the city, had an urban life disconnected from Paris, with its own active town center. There were large families living in big houses, including the one I grew up in, which was around 100 years old.
Today, most of those houses are condominiums. Each unit is a small studio or one-bedroom apartment. They were converted on the cheap, and the comfort level is really low. So many people are desperate to live in the Paris region that no matter how terrible an apartment is, it will be rented.
It is never too late to stop such destruction, but a lot of damage has already been done. A recent law upgrades the standards regulating what constitutes decent rental housing, and the government of the Ile de France region, which includes Paris, is determined to expropriate the remaining unspoiled properties and prosecute unscrupulous landlords.

http://www.lemonde.fr/logement/article/2017/09/05/l-ile-de-france-s-attaque-aux-marchands-de-sommeil_5181177_1653445.html/

AVOIDING CROOKS WHEN REGISTERING AS SELF-EMPLOYED
The registration form for self-employment, accessible through the CFE-URSSAF website, is offering a new option that is very useful. You can choose to have your information kept private during the registration procedure.

For a long time, INSEE’s policy was that such information should be fully public, with the idea that clients would check the company before doing business with it. However, this almost never happens. As far back as I can remember, there have been establishments offering their services to new businesses. Some of them are genuine, but most are what I consider to be crooks. In their letterhead, names and logos, they try to look like divisions of the French administration linked to business creation. But the “service” they offer is usually just a mention in a database that nobody checks, for which they charge between 200€ and 500€. It is often difficult to find the truly minuscule fine print at the bottom or on the back of their mailings, stating what the service is.

Now, by checking a box on the registration form, you can opt out of having your information become public, and thus avoid receiving these unwelcome solicitations. This does not mean everything you receive in the mail will be pertinent to your particular business, but at least everything is official, which makes the process a lot safer.

President Macron is going after an organization called the Régime Social des Indépendants (RSI), which was never well-organized but today has become just plain dysfunctional on so many levels that his efforts to get rid of it have made headlines in the French media. As a period of high uncertainty starts, I prefer to identify the services the French administration offers, noting that the names associated with some of these divisions may change.

1 – Health coverage is obtained on the day of registration. One of the organizations commonly chosen is RAM,

2 – A retirement account is opened when you sign for self-employed status. The organization in charge is usually CIPAV,

3 – The family subsidy collection agency is called URSSAF,

4 – The tax office’s business division is also informed of the creation of your business, and writes to inform you that it has opened a file for you,

5 – There are also several organizations sending mail about retirement accounts for any employees of the new business. You can set these aside, as they are irrelevant for many self-employed people, who usually have profession libérale status, at least at first.

Becoming self-employed used to entail many special procedures, but the number has decreased over the years.

President Macron is making a huge effort to unify everything in a single group of organizations for self-employed people – one for health, one for retirement and one for unemployment. This will not happen right away, but we know for sure that the RSI as it exists today, is nearly defunct. We just do not know yet what will happen after it is closed, or how the situation will be handled.

DOUBLING THE CEILING FOR MICRO-ENTREPRENEURS (FORMERLYAUTO-ENTREPRENEURS): PROMISES AND REALITY
President Macron is also making speeches about doubling the maximum income for the type of self-employment formerly known as auto-entrepreneur but now called micro-entrepreneur, and the government is working on carrying out his promises. There are so many aspects to this that I want to address just two, which I believe illustrate the complexity of the change.

1 – Immediate payment of social charges, monthly or quarterly
Being a micro-entrepreneur has this excellent feature: You declare your revenue either 12 times or four times a year, paying the related taxes at the same time, thus immediately freeing the business from tax debt. This is a wonderful change from the previous system, which delayed up to 18 months the payment of some of the social charges and should clearly be adopted for many other types of business, as it prevents people from spending tax money, and never paying their taxes.

2 – TVA
The sales tax called the value-added tax or TVA is the single largest provider of funds to the state coffers, so any change could have serious consequences on the budget deficit. Previously the auto-entrepreneur income ceiling was low enough that it did not have much effect on the amount of TVA collected. Doubling the ceiling and keeping the TVA exemption would have a very significant impact, however, and there is no way this will happen.

The current system is coherent and works well. This is one reason it is so popular. It has two excellent features, immediate social charge payment and no need to hold any accounting. There is just one standard deduction, which makes it impossible to claim expenses.

Should the income ceiling double for payment of social charges but remain the same for charging TVA, this status will lose one of its best features. No solution seems to have been decided thus far.

For your information:
The service providers’ annual revenue ceiling would go from 33,100 euros to 70,000 euros
The annual ceiling for sales activities would go from 82,800 euros to 170,000 euros

I will continue to follow this topic very closely, as it affects a lot of people.

http://business.lesechos.fr/entrepreneurs/auto-entrepreneur/030522905401-microentrepreneurs-le-regime-social-etendu-312662.php?BCarpDI3G0w4JAkD.99

CRACKING DOWN ON UNDOCUMENTED FOREIGNERS IN FRANCE
The French government has come up with an interesting twist on the control of undocumented foreigners. When the Schengen Agreement was signed, the idea was to improve efficiency by loosening border controls inside member countries and strengthening controls at the Schengen-area borders. The migrant and refugee crisis as well as the terrorist attacks shattered this goal and all member countries have tried to manipulate the existing legislation so they can check who is coming in.

Since country borders within the Schengen area no longer have custom offices, each police force has the right to freely check within 20 km from the border. The French government’s latest idea is that every international airport should also be considered a “border,” as they are a point of entry to the country. The point is completely true, although airports have ample police forces, and even when a person travels within the Schengen area, there is always the possibility of controls when suspicion warrants.

If the 20 km zones were applied on airports throughout France, it would put two-thirds of the French population within the zones.

Many nonprofits in France are fighting this new idea, since the true motive for such controls has nothing to do with fighting terrorism or monitoring the refugee crisis. The main reason is to catch as many undocumented foreigners as possible, since most of them live in the largest cities. Of course, this would contravene the Schengen guidelines and be stricken down by EU authorities. But using terrorism as the reason, it has a much better chance of being approved and seen as complying with the EU legislation.

http://abonnes.lemonde.fr/societe/article/2017/09/12/le-gouvernement-prepare-une-extension-massive-des-controles-d-identite-aux-frontieres_5184205_3224.html?xtmc=le_gouvernement_prepare_une_extension_massive_des_controles_d_identite_aux_frontieres&xtcr=1

MY HELPER HAS STARTED WORKING WITH MY CLIENTS
Sarah B., as my helper has called her business, started a tad later than we were hoping for. This is the kind of situations that happens all the time when one launches a new business. She is now addressing the needs of people earning less than 33,100€ in gross sales, with the micro BNC fiscal status. Such clients are exempt from doing full bookkeeping, but still have to file declarations of income to the tax office and to RSI for social charges. Managing payment of the social charges and understanding how it works can be quite complex. I do some of it when people initially register, because almost all these documents are needed to obtain the related immigration status. After that they should be autonomous, but in fact most of the time they are not.

I have been giving her name and information upon request. Her fees are between one-half and one-third of what I charge, depending on the level of services requested. Of course, she works under my supervision, so I guarantee the quality of the service, and she keeps her files in my office.

OFFICE CLOSED FOR CHRISTMAS
The office will close for three weeks for the Christmas holidays, starting on Friday December 15th, reopening on Monday January 8th. As always, I will be reachable by email for emergencies and important matters. The service I offer of receiving mail for clients will continue while the office is closed. I did not take much of a summer vacation so I have decided to take some time off, close to the normal length of my vacation. Of course, I will honor the prefecture meetings already scheduled, as well as a couple of other engagements.

Best regards,

QUESTION

EDITORIAL FREEDOM OF AN AUTHOR

I have known about you for many years but have only just begun reading your newsletter and Q/A. This past newsletter made me so very sad for you: your despair at the world events and catastrophes, that you, like most of us, can only helplessly witness. While of course you can do nothing about hurricanes, floods, terrorism and death, you do prevent or alleviate much personal disaster and allow many people to make sense of a system that is difficult to navigate. And that with a combination of unfailing courtesy and clinical detachment; you rarely bite back when faced with entitlement, sarcasm or erudition. I love the way you accept that people ARE the center of their universe … anyway, all this is to say that you do so much for so many, and France is certainly a better place with you in it. I wish you comfort.

QUESTION

ACRONYMS IN FRANCE RELATED TO SMALL BUSINESSES

I have a few questions regarding my registration with URSSAF, which I wish to do online. What will my legal status be (my statut juridique)? EI, EI avec option EIRL, or EURL? I was very happy that the prefecture approved my project and I now need to register to start working by creating my business.

QUESTION

INTERNSHIPS IN PARIS

I am American and I have been offered two full-time stages in Paris for different periods: the first from October to December 2017, and the second from January to July 2018. Both are paid a stipend, and each is with a multinational corporation. I intended to enroll in French language courses in order to improve my French, as I will be studying to enter a French business school. The prep school can sign a convention de stage, and the French courses qualify me for a student visa. What is unclear to me is whether I can legally undertake two stages, and obtain two internship visas, and, if not, whether I can obtain a student visa for the first three months followed by an internship visa for the following six months.

QUESTION

GOING FROM STUDENT TO EMPLOYEE IMMIGRATION STATUS

I have been a foreign student in France for a few years and want to become an employee. I received a complete job offer a few days ago and just learned from them that the labor inspectors (inspection du travail) visited their office. They were told that they did not have the right to hire a foreign student on a fixed-term contract (CDD). The student immigration status allows only part-time work – 60% of full-time hours. The worst thing with this situation is that the prefecture advised this solution. Clearly the inspection du travail rules, as they are the cops. Can you explain this insanity?

The vote held on June 23rd in the UK is on my mind tonight and overshadows everything else. This title sums up what the EU is going through. After 40 years of being in a relationship, even a bad one, splitting is always very painful and destructive. It takes a long time to establish a new balance

So even if the latest news does not make it easy, I would like to wish all of you a great summer and a very nice vacation.

BREXIT
Normally I never react right away to current events, but this is way too big not to make an initial analysis. Most comments are extremely negative and I share the view that it is going to be a lot worse for quite a while before it gets any better. Now I also believe that it could be a blessing in disguise. The EU must move forward after decades of staying the same in terms of creating a federal country. The UK was the main resistance to this. There could be a chance once the turmoil is over to bring back the EU vision of the1970s. I remind my readers that the UK joined the EU in 1974!

The reason Brexit is so painful to me is that the British people voted without understanding what they were voting for. They did not realize how false the anti-Europe slogans were during the campaign and how strong and solid the ties were within the EU, including the UK. They have now lost so much, certainly a lot more than they will ever gain. The rest of the EU, and especially what I consider today’s beating heart of the union – Belgium, Netherlands, Germany, Luxemburg, France, Italy, Spain and Portugal – will never depart.

A little background might be useful here. From Wikipedia: “The European Coal and Steel Community (ECSC) was an international organisation serving to unify certain Continental European countries after World War II. It was formally established in 1951 by the Treaty of Paris, which was signed by Belgium, France, West Germany, Italy, the Netherlands and Luxembourg. The ECSC was the first international organisation to be based on the principles of supranationalism, and would ultimately lead the way to the founding of the European Union.” I cannot imagine what it would be like to erase 60 years of living together.

FRENCH ESTATES AND SPLIT OF OWNERSHIP
In the USA, setting up a trust is quite common when one wants to settle his or her own estate while still alive. The key to the success of this process is, I believe, the fact that the rules and the beneficiaries are clearly defined. There is great peace of mind in knowing that everything is well organized.

French law does not have the same legal tool, and tradition favors two completely different legal mechanisms: indivision and démembrement de la propriété.

Under French law all the children must get the same amount of net assets. When it is difficult to sort this out, the assets are either sold and the money is split (démembrement), or each one becomes owner of his/her portion (démembrement – indivision). I believe the weakest point of the latter set-up is that if one wants to leave, he/she has priority over the others, as expressed by the legal concept nul n’est tenu à l’indivision,meaning that no one can be forced to stay in the joint ownership. Since there are no defining rules for the daily management of this arrangement – and no trustee – it often happens that as time goes by the heirs reach a point of disagreement and if the others cannot buy out the dissenter, the property is sold.

The another way of addressing split of ownership of an estate is the démembrement. The Latin-derived word used is usufruct in English, usufruit in French (from usus, the right to use, and fructus, the right enjoy the “fruit” or benefit of the property, e.g. by collecting rent). The split is between a person who holds the title but has no other rights, a concept called bare ownership or nu-propriété, and another person who has full use of the property, which means either living in it or renting it out.

Unlike the previous situation, it is impossible to get out of this situation unless both parties agree to sell their respective rights together. That is, the bare ownership, i.e. the title, can be sold but it stays just as “bare” of other rights for the buyer. But the usufruct is attached to one designated person and cannot be passed on to anyone else.

Problems often occur when upkeep, renovation or repairs need to be done. The law states that daily upkeep and small repairs go with the usufruct, and structural repairs and renovation go with the “bare ownership”. One can immediately see that there might be some disagreement between these two people regarding the definitions of small repairs and structural repairs.

Recently the Cour de Cassation ruled on this issue, stating that, for example, changing the front door, the gutter, the WC, or the shutters is linked to the usufruct. To avoid lawsuits, the parties are now advised to draw up a contract that is very similar to a lease defining the rights and obligations of both parties, thus avoiding interpretation of the law specific to the matter.

About a year ago, the law changed and foreigners living in France now can choose the law of their country of citizenship to govern their estate. What I have described above may be a good reason to choose a legal regime other than that of France. It might also be advisable to speak to a notaire about the matter.

http://abonnes.lemonde.fr/argent/article/2016/05/07/comment-se-partagent-les-frais-d-un-bien-immobilier-en-indivision_4915320_1657007.html

NEW REGULATIONS REGARDING MANDATORY SCHOOLING IN FRANCE
As in most Western countries, there is an obligation to school children in France between ages 6 and 16. The parents are responsible for making sure the schooling occurs, but the choice of how it happens is up to them. There are in effect four types of schooling in France:

• Public school
• Private school with a contract with the state
• Private school without a contract
• Homeschooling
• Public school, as its name implies, is run by the government; the teachers and everyone else working there are civil servants. They must do exactly what the Ministry of Education rules.

Some private schools have signed a contract with the state, and therefore are more or less government-monitored. Their teachers are paid by the state and they must have education and diplomas meeting government standards. Their teaching is monitored by the state regarding the topics for each grade. The main difference is generally that religious instruction is included on top of the school curriculum, and there may be a slightly different orientation in the teaching methods, some philosophical or religious views, and so on.

Until very recently, private schools without a contract, had no interaction with the French administration. For a long time such schools had only to send a note informing the government of their establishment and that was that. Neither the teachers nor the curriculum were verified. Now, however, new regulations have changed this: the school must obtain government approval, which means presenting the teachers, the staff, the curriculum for each grade, and so on. Time will tell how much control is exercised and how rigid the requirements will be.

Homeschooling was unheard of in France until recently. I am sure it always existed but on a minimal level, and there were objective reasons for that: the authorities did not see it as a threat. Also, when it did happen, it was done through the Centre National d’Education à Distance, a division of the Ministry of Education.

On June 9th, however, the Ministry of Education, in addition to cracking down on non-contract private schools, warned that homeschooling might be limited as well. Its reasoning is that a growing segment of the population has radical views that are incompatible with the French way of life, and that children educated at home are in danger of being taught dangerous views. Many people might immediately think of radical Muslims and terrorism, but while it is true that this danger exists, today all three monotheistic religions have among them radical groups that refuse to accept the authority of the state, preferring allegiance to their religious beliefs.

My concern is that a wide range of alternative schooling methods be preserved. Some, like Montessori, are not recognized by the French authorities, which I find odd; thus, they cannot sign a contract with the government. This type of school should easily be approved. I worry that the government is taking too narrow a view of the situation and treating proven methods of education the same as schooling by religious extremists and cults only because they differ from the traditional approach. Still, the statistics make it clear that the number of parents choosing the “Montessori type” of schooling is growing, so this issue should be addressed and these schools should be fully recognized.

A BIG STEP FOR MY PRACTICE
The family-owned SARL A Survival Kit For Paris now officially exists and has a bank account. It is premature to switch my complete accounting over to this account as long as I stay in the current office at 7 rue Ganneron. Therefore I do not yet accept payment in that name, but for me it means everything is ready to transition to the new set-up.

INCREASE OF MY FEES ON OCTOBER 1st 2016
It has been about six years since my fees last increased. On October 1st, I will raise my initial retainer from 250€ to 270€ and the hourly rate from 100€ to 110€.

MY OFFICE WILL NOT CLOSE DURING THE SUMMER VACATION
Since my office situation has not been resolved and I do not anticipate being able to move before August or early September, I am not planning any vacation time and do not expect to go away for any length of time this summer. Depending on the outcome of my office search and how quickly it proceeds, this could change some – but not much, considering the fact that any changes would be last minute.

Best regards,

QUESTION

FRENCH SHORT-TERM RENTAL AND PRIMARY RESIDENCE

We moved to Paris a few months ago from the USA on a visitor visa. While staying in a short-term rental, we tried to rent long term in Paris and it ended up being a complete mission impossible. Even when we offered to set aside six months or even a year’s worth of rent, we were only offered leases that stated that this would be our secondary residence. So we gave up and agreed to sign the one that seemed to be best protecting our interests. We might be buying an apartment in a few years or even sooner so we are determined to stay in France, but can we be thrown out of our current apartment in a year or less?

QUESTION

REGISTERING A SMALL BUSINESS IN FRANCE SINCE URSSAF CHANGED REGULATIONS ON MICRO STATUS

I obtained a professional immigration visa at the French consulate in Atlanta, as I work in the advertising industry mainly for fashion companies. After a few trips to Paris, I made enough contacts to try relocating in France. After I arrived I found out that I cannot get the professional status I want. I know that my business is going to grow slowly and it might take several years before I exceed the 32,000€ billing limit of the micro BNC income tax status. But I found out by going to URSSAF that the only way I now can get this fiscal status is by signing up for auto-entrepreneur fiscal status. Then I called the prefecture and found out that my visa does not allow me to choose that status and I must stay with the traditional BNC, which means paying TVA, keeping books and therefore hiring a French CPA to do the year-end declarations and so on. I feel like I have been cheated by the system. Can this be fixed or am I really to be penalized and have to accept this full-grown business status, which is costly and cumbersome?