With a sizeable domestic market and a large pool of engineers and scientists educated at top colleges and universities, France is already a prime potential location for foreign technology groups and R&D operations. But it also holds another ‘trump card’ to swing decisions in its favor. A number of groups, including Huawei, Microsoft, and Intel, have cited France’s research tax credit (crédit d’impôt recherche – CIR) as one of the reasons for locating their R&D operations in the country. This tax credit, which covers 30% of R&D project expenditure (net after tax) puts France head and shoulders above the rest of Europe for R&D tax treatment.

Moreover, the 2008 and 2009 research tax credit programs incorporated an upfront research tax credit rebate for loss-making companies, with indefinite eligibility for SMEs. This rebate has since been helping to ease company cash flow management…