When a foreign company decides to settle in France in order to carry out transactions subject to payment of French VAT, it must hire a tax representative that will represent them at the tax authorities. This is not the case for companies established in the European Union or in certain other countries (please refer to our page “When and how should I appoint a tax representative in France?” to see the list of countries for which the appointment of a tax representative is not useful).
The tax representative is mandated by the foreign company, when the law requires to do so.
The tax representative can be anyone who has a permanent establishment in France and is himself subject to payment of French VAT. He has to be approved by the French tax authorities.
Failure to appoint a tax representative may have negative consequences for the business and reputation of the foreign company, as the foreign company's customer will then be liable for the payment of French VAT as well as penalties incurred.