Regulatory Innovation: From Barrier to Enabler

French regulatory innovation extended beyond immigration and investment. Recognizing that outdated rules hindered innovation, successive governments implemented startup-friendly reforms:

Stock Options Reform (2015-2018): France's BSPCE (bons de souscription de parts de créateur d'entreprise) were simplified and tax treatment improved. Employees exercising options faced capital gains tax, not income tax, making equity compensation finally competitive.

PACTE Law (2019): This comprehensive reform touched everything from employee shareholding to bankruptcy procedures. Companies could issue multiple share classes, facilitating VC investment. Failure became less punitive, encouraging serial entrepreneurship.

Regulatory Sandboxes: Following UK precedent, France created spaces for testing innovation. The ACPR (banking regulator) and AMF (markets regulator) established fintech sandboxes. Similar programs emerged for healthtech, mobility, and other regulated sectors.

Digital Services Tax: While controversial internationally, France's tax on tech giants signaled commitment to fair competition. Revenue funded startup programs while ensuring foreign platforms contributed to the ecosystem they benefited from.