The company will pay a 500-million-euro fine for tax evasion, as well as a further 465 million euros to settle claims with French tax authorities.
In a statement, Google confirmed the settlement and hailed the fact it had put an end to fiscal differences that it had had with France for numerous years.
The settlement follows similar out-of-court agreements reached in Italy and Britain by Google in recent years, though the French agreement is much larger than the previous ones.
Google said it now wanted to see a coordinated reform for a clear international taxation framework.
French Justice Minister Nicole Belloubet and Budget Minister Gerald Darmanin welcomed the “definitive settling” of all the contentious issues, adding in a statement that it was the result of two years of intense work by the French authorities.
“This outcome is good news for the public finances and fiscal fairness in France,” their statement said.
Belloubet said the settlement showed that the French authorities have the tools to ensure an equitable tax system.
“It is a historic settlement both for our public finances and because it marks the end of an era,” Darmanin said.
“By normalising Google”s situation in France, (the settlement) responds to our citizens” demands for fiscal fairness,” he said.