Businesses operating in France’s overseas departments and regions (DOM) can benefit from significant tax relief through the Next Generation Free Trade Zones (ZFANG) scheme. This initiative offers an 80% exemption on property tax for non-built properties, with an enhanced 100% exemption available for specific sectors and locations, including French Guiana and Mayotte. Eligible sectors include research, tourism, and renewable energy, among others. Contact Ministère de l’Economie, des Finances et de la Souveraineté Industrielle et Numérique for more details on how to apply.
Objectives
The ZFANG scheme aims to support businesses established in France’s overseas territories by providing substantial tax exemptions. This initiative encourages investment in key sectors, fostering economic growth and innovation in these regions. The tax exemptions are designed to stimulate business activity and attract new investments, particularly in industries that contribute to sustainable development.
Beneficiaries
The ZFANG scheme is available to businesses established in the overseas departments and regions (DOM), including those facing financial difficulties. Eligible sectors are those that qualify for tax reductions under article 199 undecies B of the French Tax Code, aimed at promoting overseas investments.
Eligible operations
The scheme provides a tax exemption on non-built property for real estate attached from 1 January 2019 onwards. The exemption applies to property taxes for businesses operating in specific sectors, including:
- Research and development
- Information and communication technology (excluding IT consulting)
- Tourism and related leisure activities
- Agro-nutrition
- Environment and renewable energy
- Building and public works
- Cosmetic and pharmaceutical production
- From 1 January 2024: naval industry and electronic game publishing.
Notably, businesses benefiting from the active improvement regime can achieve a full exemption up to €150,000 of taxable base if they meet specific revenue criteria.
Eligibility conditions
To qualify for the enhanced 100% exemption, businesses must:
- Be located in French Guiana or Mayotte
- Operate in one of the specified sectors
- Meet the revenue criteria related to the active improvement regime, ensuring that at least one-third of revenue comes from eligible operations.
Standard beneficiaries receive an 80% exemption on property tax.
Grant amount
The ZFANG scheme offers an 80% tax exemption on property tax for non-built properties, with a potential increase to 100% for eligible businesses in specific sectors and locations. This can significantly reduce tax liabilities, promoting investment in the overseas territories. For businesses qualifying under the active improvement regime, a full exemption applies up to €150,000 of taxable base.
Frequently asked questions
Can I combine ZFANG with other tax incentives?
Yes, ZFANG can be combined with other tax incentives available for businesses in the overseas territories. However, specific conditions may apply, so it’s advisable to consult Ministère de l’Economie, des Finances et de la Souveraineté Industrielle et Numérique for detailed guidance.
How long does it take to process ZFANG applications?
The processing time for ZFANG applications generally varies from 4 to 8 weeks, influenced by the complexity of the application and the completeness of your documents. For a more precise timeline based on your individual case, please contact Ministère de l’Economie, des Finances et de la Souveraineté Industrielle et Numérique directly.
Is my business in Mayotte eligible for ZFANG?
Yes, businesses located in Mayotte can qualify for ZFANG benefits, provided they meet the eligibility criteria related to sector and revenue.
What should I do if my ZFANG application is rejected?
If your application is rejected, you can request a detailed explanation from the relevant authorities and consider reapplying with improved documentation or adjustments to your business plan.
Is ZFANG still active in 2026?
Yes, the ZFANG scheme is active and continues to support businesses in the overseas territories. For the latest updates and details, check with Ministère de l’Economie, des Finances et de la Souveraineté Industrielle et Numérique.