In order to provide more tailored support to vulnerable rural areas and to promote the establishment of companies in these areas, the new ZFRR zoning replaces ZRRs and strengthens tax exemptions for companies located in these areas.

What does the new FRR zoning change?

This reform, which is enshrined in the 2024 budget law, will apply to more than 17,700 municipalities in mainland France and overseas from 1^er July 2024.

France Ruralités Revitalization replaces the ZRRs, the employment pools to be revitalized (BER) as of December 31, 2024 and the rural business revitalization zones (ZORCOMIR).

It will include 2 levels of zoning:

• FRR zones (also called FRR “stand”);
• FRR + boxes (from 2025), intended for municipalities most in difficulty. Increased aid will be granted to companies located in these territories.

To delimit these areas, population density and per capita disposable income were the 2 classification criteria used.

FRR zoning will be reviewed every 6 years.

Although not retained when the FRRAs were put in place, the municipalities classified or benefiting from the effects of the designation as a rural revitalization area (RRZ) as at 30 June 2024 now benefit from the effects of ZFRR classification.

What are the benefits for companies located in an FRR zone?

Enterprises located in an RRRA will be eligible for tax and social security exemption schemes.

Such exemptions may concern:

• income or business tax;
• in the case of the municipality's deliberation before the 1, the exemption will be in the case of the real estate contribution (CFE)^er October N to apply from 1^er January N+1;
• the property tax on built-up property (TFPB), this exemption will be made in case of deliberation of the municipality before 1^er October N to apply from 1^er January N+1.

What are the conditions for benefiting from tax and social security exemptions?

For tax exemptions, the company must complete several conditions :

• employ less than 11 employees ;
• to engage in industrial, commercial, craft or professional activities;
• have its registered office and all of its business and means of operation located in an RRF zone;
• be automatically or on option subject to a actual taxation system ;
• be created or resumed between 1^er july 2024 and december 31, 2029.

Under the new RRF, the duration of all tax exemptions is harmonized.

Thus, the exemptions are applicable for 5 years at 100 % before being reduced degressively for the following 3 years (75 %, 50 % and then 25 %).

Concerning the social exemptions, the conditions are identical to those applicable to the RRs:

• employ less than 50 employees ;
• engage in craft, industrial, commercial, agricultural or non-commercial activities;
• hire from an establishment located in FRR (employee on a permanent contract or permanent contract of at least 12 months);
• ne not having made a dismissal for economic reasons within 12 months prior to employment.