French SaaS Founder Opens Irish LTD as EU Enterprise Contracting Base — French SAS Retained for R&D

French SaaS Founder Opens Irish LTD as EU Enterprise Contracting Base — French SAS Retained for R&D

Background: French SAS optimal for R&D, suboptimal for enterprise contracting

The founder had built the SaaS in Paris, hiring engineers under SAS structures eligible for the French Crédit Impôt Recherche (CIR — research tax credit at 30% of qualifying expenditure). The CIR is one of Europe’s strongest R&D incentives and was responsible for ~€340k of cash savings in the prior year. But for EU enterprise contracting, the French SAS structure created friction: enterprise procurement teams found the SAS legal form unfamiliar and CFO sign-offs slowed.

The challenge: get an Irish enterprise face without losing CIR

The CIR is granted to French companies for qualifying R&D performed in France. Moving the engineering team or the IP out of France would imperil CIR. The right structure was a two-entity group: keep the French SAS as the R&D and IP-development entity (preserving CIR), add an Irish LTD as the enterprise contracting and licensing entity, and document the intercompany services and licensing arrangements at arm’s length.

The solution: Irish LTD on top of the French SAS

Chern & Co coordinated with the founder’s French tax counsel to:

• Incorporate the Irish LTD with the founder as sole director (French residency satisfies Section 137 EEA requirement)
• Draft a constitution providing for ordinary and preference shares ahead of Series B
• File A1, RBO and Revenue tax registrations
• Implement an intercompany services agreement: French SAS provides R&D and engineering services to Irish LTD at a transfer-pricing-compliant cost-plus margin
• Implement an IP licensing agreement: French SAS owns the IP and licenses it to the Irish LTD on an arm’s-length royalty
• Re-paper enterprise contracts so the Irish LTD is the contracting party

The outcome: enterprise traction without CIR risk

The Irish LTD signed two enterprise framework agreements within month two. The French tax counsel confirmed the CIR position was preserved because R&D continued to be performed by, and qualifying expenditure incurred in, the French SAS. Group profitability is now distributed between the two entities at arm’s length pricing, with audit trails sufficient for both Direction Générale des Finances Publiques and Revenue Commissioners.

Why a two-entity Ireland + home-country structure works for EU founders

EU founders rarely benefit from moving everything to Ireland. The right pattern is usually a two-entity group: home country for staff, R&D and IP (preserving local incentives like CIR, KETC or similar), Ireland for enterprise contracting and licensing. Chern & Co works only with founders whose home-country tax counsel can sign off on the substance and pricing — both sides matter.