Eviction Process and Lease Termination (Commercial Lease) in France

Evicting a tenant who holds a commercial lease (enjoying what is known as "Propriété Commerciale" or commercial property rights) is one of the most technical judicial procedures in French real estate law. Governed primarily by the Decree of 30 September 1953 (now codified in Articles L.145-1 to L.145-60 of the Code de commerce), it involves complex defensive strategies for saving businesses (safeguard proceedings, receivership, or liquidation), which can delay the landlord's action for many months. A distinction is made between eviction (for breach of contract, such as non-payment) and non-renewal (to recover the premises at the end of the 9-year term).

1. Termination for Fault (Unpaid rent) Rather than waiting for the lease term, the landlord may demand early termination for accumulated arrears or severe damage. Most commercial leases include a termination clause (clause résolutoire), stipulating the automatic termination of the contract if a fundamental obligation is violated (typically non-payment or lack of insurance).

The Step-by-Step Procedure:

1. The Order to Pay (Commandement de Payer): A bailiff (commissaire de justice) serves the tenant with a "Commandement de Payer Visant la Clause Résolutoire du Bail" (Order to Pay citing the Termination Clause).
2. The 1-Month Deadline: From the date of notification, the commercial tenant has exactly one (1) month to fully settle their debt or remedy the breach.
3. The Summons to the Judicial Court (Summary Proceedings - Référé): If the deadline passes without full settlement, the landlord may petition the judge to record the acquisition of the termination clause and order eviction.
4. Grace Periods: The judge retains judicial discretion and may, in some cases, grant the tenant a payment schedule (up to two years) and suspend the effects of the termination clause during that period.
5. The Order to Vacate and Forced Eviction: If the tenant fails to respect the court-ordered schedule, the landlord may proceed with forced eviction via a bailiff and, if necessary, the assistance of law enforcement.

Note on bankruptcies: If the tenant enters insolvency proceedings (receivership or liquidation), the landlord is subject to a "stay of proceedings" for past rent. Eviction for arrears dating from before the bankruptcy is generally prohibited during these proceedings.

2. The "Right to Reclaim" (Refusal to Renew at Term) At the end of the 9-year term, the landlord can choose to refuse renewal, but this typically triggers a right to compensation for the tenant.

a. The Eviction Indemnity (Indemnité d'Éviction)

In France, a landlord who refuses renewal without a serious and legitimate motive must pay the tenant an eviction indemnity. Under Article L.145-14 of the Commercial Code, this sum must compensate for the entire loss caused. It typically covers:

• Loss of the "Fonds de Commerce" (business goodwill).
• Relocation and administrative costs.
• Future remodeling costs.

The indemnity awarded by commercial judges can be significant, sometimes reaching 100% of the annual turnover or more. Appraisal processes can be lengthy, sometimes taking several years.

b. The Landlord is Exempted from the Indemnity Only if:

• There is a "Serious and Legitimate Motive" (e.g., persistent breach of obligations or repeated non-payment).
• A legal obligation requires reconstruction (e.g., a building declared unsafe/insalubrious).
• The landlord recovers the premises for a restricted list of residential or public utility reasons.

Given the high level of protection for commercial tenants, landlords should ensure rigorous documentation of any breaches. Back to the Commercial Overview: FrancePreview unavailable.

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