France passes pro-captive legislation
France’s Ministry for the Economy, Finance and Industrial and Digital Sovereignty has announced that it has brought in legislation to encourage captive insurance companies in the country.
The Ministry has brought in a decree that defines the applicable ceilings and accounting rules for the provision in the articles of the general tax code that were brought in last year.
It also establishes this new rule in France’s insurance code. The provisions of this decree apply to accounts relating to fiscal years beginning on or after January 1, 2023.
In December of last year France’s Senate passed a measure aimed at improving the risk coverage of French companies, by facilitating the creation of self-reinsurance structures.
With the support of the French Government the senators adopted two identical amendments aimed at allowing the establishment of a specific provision facilitating the creation of captive reinsurance companies by making them tax deductible.
The new changes to the French tax code are a direct result of that new provision.