Commercial Leases in France: Complete Guide for Property Owners
overview of French commercial lease law (the 3-6-9 lease), 'commercial property' rights, renewal, eviction indemnity, and ILC indexation rules.
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The status of commercial leases in France (bail commercial) is one of the most protective in the world for the operating tenant (the merchant, artisan, or industrialist). The legislator's goal is to protect the tenant's business asset (the clientele and the location, known as the fonds de commerce) against arbitrary eviction by the property owner (the landlord). This rigid, public-policy framework is colloquially known as "commercial property" (propriété commerciale).
Key Rules at a Glance
| Feature | Primary Rule | Legal Basis | | | --- | --- | --- | | | Lease Duration | Minimum 9 years (the famous "3-6-9" lease) | L145-4 C. com | | | Tenant Termination | Every 3 years (triennial) with 6 months' notice | L145-4 C. com | | | Security Deposit | Freely negotiated (often 1 quarter in advance) | Practice (+ L145-40 C. com) | | | Renewal | (Quasi) automatic right of the tenant at the end | L145-8 C. com | | | Refusal to Renew | Landlord must pay an eviction indemnity | L145-14 C. com | | | Rent Indexation | Usually annual via the ILC or ILAT | L145-34 C. com | | | Legal Revision | Possible capping every 3 years (triennial revision) | L145-38 C. com | | | Rent at Renewal | Principle of capping (unless local factors change or lease > 9 years) | L145-34 C. com |
- The "3-6-9" Lease and Its Duration The minimum duration of a standard commercial lease is 9 years.
For the Tenant (Flexible Termination) The tenant has the right to give notice to terminate the lease at the end of each three-year period (after 3 years, 6 years, or 9 years): this is the origin of the term "3-6-9 lease." The notice must be given via a bailiff (commissaire de justice) or registered letter with acknowledgment of receipt (LRAR), with 6 months' notice.
For the Landlord (Locked In) The landlord cannot terminate the lease every three years (except in very limited and complex cases like rebuilding the property). They are committed for the entire 9 years. For certain downtown activities or pop-up events, new tools exist such as the "derogatory lease" (bail dérogatoire, maximum 4 years, previously 3) without the right to renewal, or since 2023, the ultra-short lease (between 1 and 6 months). More details in Commercial Lease Requirements.
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Right to Renewal and Eviction Indemnity The keystone of French "commercial property" is the right to lease renewal. At the end of the 9th year, if neither party takes action, the lease does not end: it is tacitly extended month by month (and beware, if it crosses the 12-year mark, the rent cap can be removed). A landlord who wishes to refuse the renewal or reclaim their premises ("give notice with an offer of non-renewal") must pay the tenant an eviction indemnity (indemnité d'éviction). This indemnity is colossal because it compensates for the prejudice caused by the loss of the premises or the business asset itself (market value of the business, moving costs, loss of clientele, potential staff layoffs...). It is often calculated by court-appointed experts. Learn more in our Commercial Eviction Process guide.
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Rents and Indexation (ILC / ILAT) The initial rent is freely determined between the parties. However, any increase during the lease must be based on a sliding scale clause (indexation) or the legal triennial revision: - The Commercial Rent Index (ILC) for retail and craftsmen. - The Tertiary Activities Rent Index (ILAT) for offices and liberal professions. At the time of renewal (after 9 years), the increase in the new rent is, in principle, capped at the variation of the index over the past 9 years. The landlord can only "uncap" this limit (déplafonnement) to align it with the true "rental value" of the market under strict circumstances (notable modification of the business, the street, a lease signed for more than 9 years, or tacit reconduction beyond 12 years). Learn about the increase system in Commercial Rent Increases.
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Taxes, Charges, and Security Deposits (Pinel Law) Historically, the commercial tenant assumed almost all charges ("triple net" leases). The Pinel Law of 2014 put an end to these excessive practices: - The landlord can no longer bill tenants for management fees related to rent collection, nor for major heavy repairs (Article 606 of the civil code: roof, walls...). - The Security Deposit is not strictly capped by law, but practice dictates it be 3 to 6 months. If it exceeds 2 terms of rent (more than 6 months for a rent paid quarterly), the landlord must pay interest to the tenant. (Note that a bill in 2024/2025 aims to cap the deposit at one quarter).
For more details: Commercial Security Deposits and Commercial Maintenance Obligations.
Complexity
Managed by Landager French commercial leases are full of "traps" tied to deadlines (3-year revision, uncapping exactly after 12 years). The Landager platform helps real estate companies and SCPI managers integrate annual INSEE ILC indexations without retroactive calculation errors. It systematically generates an alarm 6 months before the 9-year or 12-year deadlines to notify of opportunities for renewal or tactical rent uncapping. Explore the specifics of commercial leases in France:
How Landager Helps
Landager automates your Loi Alur 'Contrat Type' compliance, tracks 'Zone Tendue' rent controls, and ensures your commercial property meets all INSEE indexation requirements.
Back to France Landlord-Tenant Laws Overview.
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