You have just found the perfect premises for your French venture: a small shop in Paris, an office in La Défense, a workshop in Seine-Saint-Denis. The estate agent slides a French-language lease across the table and tells you it is a standard 3-6-9. You nod, but one question keeps nagging you: if the business takes off, can the landlord take the premises back or triple the rent? And if it struggles, can you walk away? This article answers both questions with the exact rules that govern your first French commercial lease, known in France as the bail commercial, and with the practical steps a foreign-owned company should take before signing, when the nine years run out, and when a dispute starts. French law gives commercial tenants unusually strong protection: a minimum nine-year term, a right to leave every three years, a right to renew the lease when it expires, and, if the landlord refuses renewal, a payment called the indemnité d’éviction, compensation for eviction, that often equals the market value of the business itself. But none of this is automatic. The protection only applies if your company is properly registered in France, only if the business is genuinely operated in the premises, and only if you respect strict notice periods and court deadlines. Foreign founders lose cases every year on exactly these formalities: an unregistered company, a missed six-month notice, a two-year limitation period that expired unnoticed. The first part of this guide explains how to enter the protected status safely and how the nine-year lease works in practice. The second part explains what happens at the end of the lease: renewal, refusal, eviction money, rent increases, and the fast-track termination procedure landlords use against tenants who stop paying. Throughout, every decisive rule is quoted from the French Commercial Code and from decisions of the Cour de cassation, the French supreme court for civil and commercial matters, so you can check each statement against its official source.
I. How a foreign company signs its first French 3-6-9 commercial lease without getting trapped
A. Does your French company qualify for protected commercial lease status
Before negotiating a single clause, confirm that your company can actually claim the protected bail commercial status of articles L.145-1 and following of the French Commercial Code. The statute opens this protection to a precise circle of tenants. It provides, in article L.145-1 of the Commercial Code, that “Les dispositions du présent chapitre s’appliquent aux baux des immeubles ou locaux dans lesquels un fonds est exploité, que ce fonds appartienne, soit à un commerçant ou à un industriel immatriculé au registre du commerce et des sociétés” — the chapter applies to leases of buildings or premises in which a business (fonds de commerce, the intangible and tangible assets used to run the commercial activity: clientele, lease right, equipment, stock) is operated, where the business belongs to a trader or manufacturer registered with the trade and companies register. That register, the Registre du commerce et des sociétés (RCS), is kept by the greffe, the registry office attached to each commercial court, and registration produces the famous Kbis extract: the official identity card of a French company. Since 1 January 2023, registration runs through the single online desk called the guichet unique, operated by the Institut national de la propriété industrielle (INPI), the French intellectual-property and business-registration office, and the data feeds the Registre national des entreprises (RNE), the national business register. The practical lesson is blunt: a foreign parent company that merely signs a Paris lease in its own name, without a French registered entity or registered French branch (succursale), will struggle to claim the protected status, because the fonds operated in the premises belongs to no trader registered in France. Foreign founders who want the protection therefore incorporate first — usually a société par actions simplifiée (SAS, the flexible French joint-stock company) — obtain the Kbis, and only then sign the lease in the name of the French entity. If you are still hesitating between a SAS, a société à responsabilité limitée (SARL, the French limited-liability company), a branch and a subsidiary, read our step-by-step guide to setting up a company in France as a foreign founder before going further.
Three further entry conditions deserve your attention because each of them traps foreign tenants regularly. First, the premises must genuinely serve the business. A lease for premises used purely as offices can be carved out of the protected status: article L.145-4 of the Commercial Code expressly allows leases “des locaux à usage exclusif de bureaux” — premises for exclusive office use — to “comporter des stipulations contraires”, to contain terms departing from the protective chapter. In plain English: a pure office lease can lawfully waive the 3-6-9 rhythm, the renewal right and the eviction compensation if the contract says so. Always check whether your draft contains such a waiver, and if the premises mix office, storage and customer-facing use, make sure the commercial destination is written into the lease. Second, simple domiciliation is not a lease. A domiciliation contract that gives your SAS a prestigious Paris address for its Kbis gives you no tenancy right over those premises; only a real lease or sub-lease does. Many foreign founders discover this when the domiciliation agent terminates the contract and they realise they never held a bail at all. Third, if you are not ready for nine years, French law offers a lawful waiting room. Article L.145-5 of the Commercial Code states that “Les parties peuvent, lors de l’entrée dans les lieux du preneur, déroger aux dispositions du présent chapitre à la condition que la durée totale du bail ou des baux successifs ne soit pas supérieure à trois ans.” The parties may, when the tenant takes possession, opt out of the protective chapter provided the total duration does not exceed three years. This is the bail dérogatoire, the short-term derogatory lease. It suits a pop-up shop, a market test or the months while your SAS waits for its Kbis. But the trap is mechanical: if, at the end of the period, “le preneur reste et est laissé en possession, il s’opère un nouveau bail” subject to the protective chapter — a tenant who stays on with the landlord’s tolerance automatically graduates into a full nine-year protected lease. So diary the expiry date, and either leave, or sign a proper bail commercial with full awareness of what follows.
B. The nine-year lease in practice: exit rights, rent, charges and inventory
Once the protected status is secured, the core rule is simple and mandatory. Article L.145-4 of the Commercial Code provides that “La durée du contrat de location ne peut être inférieure à neuf ans.” The lease term cannot be shorter than nine years. Any clause fixing a shorter term in a protected lease is rewritten by the statute to nine years; you cannot contract out of the minimum to please a landlord who wants five. The famous 3-6-9 rhythm is the tenant’s mirror right: the same article continues that “le preneur a la faculté de donner congé à l’expiration d’une période triennale, au moins six mois à l’avance, par lettre recommandée avec demande d’avis de réception ou par acte extrajudiciaire” — the tenant may give notice at the end of each three-year period, at least six months in advance, by registered letter with acknowledgment of receipt or by bailiff’s writ (acte extrajudiciaire, now called acte de commissaire de justice since the huissier profession merged with court clerks, but the old word still appears in many leases). For a foreign company testing the French market, this is the single most valuable clause in French business law: you sign for nine, but you may leave at year three or year six with six months’ notice, without paying the remaining rent and without owing compensation. The landlord, by contrast, cannot end the lease at year three or six except for narrow statutory reasons such as rebuilding or raising the building, listed in the same article. Negotiating practice adds two refinements you should discuss with counsel before signing. Landlords often ask the tenant to waive the three-year exit right — a bail ferme of six or nine years — which is lawful only for the specific categories the statute lists, and otherwise void; never accept such a waiver without checking it against the text. Conversely, tenants sometimes negotiate an early-exit clause for specific events (failure to obtain a licence, headcount thresholds), which is lawful and worth inserting while you still have bargaining power, because after signature the landlord owes you nothing more than the statute.
Money clauses come next, and here foreign tenants systematically underestimate three items. First, the security deposit (dépôt de garantie): unlike residential leases, commercial law sets no maximum, and two quarters’ rent is common in Paris for a foreign company with no French balance sheet. Second, the allocation of charges, taxes and works. Since the Loi Pinel of 18 June 2014 on crafts, commerce and very small firms, the lease must contain a precise inventory of the categories of charges, taxes and works allocated to each party, and landlords can no longer silently pass major structural works to the tenant; the boundary follows article 606 of the Civil Code, which reserves major structural repairs (grosses réparations: walls, roof frame, foundations) to the owner. Read the charges schedule line by line, ask who pays the taxe foncière (the French property tax billed to the owner but routinely passed to commercial tenants by contract), the office tax in Île-de-France, the building insurance, the management fees, and the cost of bringing the premises up to accessibility and energy standards. Third, rent indexation. French commercial rents move with official indices published quarterly by INSEE, the national statistics institute — typically the indice des loyers commerciaux (ILC) for shops or the indice des loyers des activités tertiaires (ILAT) for offices — and the lease states the reference quarter and the cap, if any. An indexation clause with no cap can lift the rent well beyond inflation over nine years, so negotiate a tunnel or a cap while the landlord still wants your signature. Finally, never sign without a joint entry inventory (état des lieux d’entrée), preferably established by a commissaire de justice (court officer, formerly huissier de justice). Without a contradictory inventory, the tenant is presumed to have received the premises in good repair and must return them so; with one, every pre-existing crack, stain and faulty shutter is documented and cannot be charged to you on exit. Add the energy performance file (diagnostic de performance énergétique) and, for older buildings, the asbestos and lead reports, and keep a full signed copy of everything: French courts decide lease-exit disputes on paperwork, not on memories.
II. What happens when your French landlord refuses to renew or raises the rent
A. Refusal to renew, notice to quit and your right to eviction compensation
At the end of the nine years, the lease does not simply die. Article L.145-9 of the Commercial Code sets the only two lawful exits: “les baux de locaux soumis au présent chapitre ne cessent que par l’effet d’un congé donné six mois à l’avance ou d’une demande de renouvellement” — protected leases end only by a notice to quit (congé) given six months in advance, or by a renewal request. And the same article adds the tenant’s safety net: “A défaut de congé ou de demande de renouvellement, le bail fait par écrit se prolonge tacitement au-delà du terme fixé par le contrat.” If neither side acts, the written lease continues silently beyond its end date on the same terms — the tacite prolongation, tacit extension, during which notice must then be given at least six months ahead for the last day of a calendar quarter. For a foreign director managing from abroad, this mechanism is both a shield and a trap: a shield, because a landlord who simply says nothing cannot recover the premises; a trap, because a tenant who wants to leave must still serve a formal congé by bailiff’s writ or registered letter, and an email to the agent is worth nothing. The official business guidance on service-public.fr confirms the sequence step by step: renewal or tacit extension of the commercial lease, the six-month notice, and, where the owner refuses renewal, the dedicated procedure described on the page for refusal of renewal of a commercial lease (see renewal or tacit extension of the commercial lease and refusal of renewal by the owner).
The landlord is entitled to refuse renewal — but, outside narrow statutory exceptions such as serious and legitimate grounds or lawful repossession for demolition and rebuilding, refusal comes with a price tag. Article L.145-14 of the Commercial Code provides that “le bailleur doit, sauf exceptions prévues aux articles L. 145-17 et suivants , payer au locataire évincé une indemnité dite d’éviction égale au préjudice causé par le défaut de renouvellement” — the landlord must pay the evicted tenant eviction compensation equal to the loss caused by the failure to renew. The statute then details the content: “Cette indemnité comprend notamment la valeur marchande du fonds de commerce, déterminée suivant les usages de la profession, augmentée éventuellement des frais normaux de déménagement et de réinstallation, ainsi que des frais et droits de mutation à payer pour un fonds de même valeur” — the payment covers notably the market value of the business determined according to professional practice, plus standard removal and reinstallation costs and the transfer taxes payable for an equivalent business. In central Paris, where the fonds de commerce of a busy restaurant or boutique can be worth several years of turnover, the indemnité d’éviction is frequently the largest cheque the landlord will ever write, which is exactly why refusals are negotiated rather than imposed. Two conditions on the tenant’s side decide whether this jackpot exists at all. First, article L.145-8 of the Commercial Code grants the renewal right only to “le propriétaire du fonds qui est exploité dans les lieux” — the owner of the business operated in the premises — and requires that the business “doit, sauf motifs légitimes, avoir fait l’objet d’une exploitation effective au cours des trois années qui ont précédé la date d’expiration du bail” — must, absent legitimate reasons, have been effectively operated during the three years before expiry. A foreign group that leaves its Paris shop dark for two years while restructuring, then claims renewal, will be refused without compensation. Keep the premises trading, keep turnover provable, and keep your registration continuous. Second, act within time. Article L.145-60 of the Commercial Code states that “Toutes les actions exercées en vertu du présent chapitre se prescrivent par deux ans.” Every action under the commercial-lease chapter is time-barred after two years. The Cour de cassation applies this limitation strictly: in Cass. 3rd civ., 23 April 2013, no. 12-15.836, it held that “la prescription biennale de l’article L. 145-60 du code de commerce n’est pas soumise à la contestation du droit du locataire au paiement d’une indemnité d’éviction et que le délai de prescription, interrompu par la saisine du juge des référés avait commencé à courir à compter du prononcé de l’ordonnance du 27 octobre 2006 désignant un expert” — the two-year bar runs regardless of whether the right to compensation is disputed, and once interrupted by an application to the urgent-applications judge, it starts running again from delivery of the order appointing the expert. A tenant who waits more than two years after that order to claim the money loses everything, even against a landlord who had agreed to pay in principle.
The amount itself is fought over euro by euro, and the Cour de cassation polices the calculation. In Cass. 3rd civ., 10 October 2019, no. 18-19.662, a Paris court of appeal had awarded a tenant a total of 1,136,920 euros under all heads — principal indemnity of 615,000 euros, re-employment indemnity of 56,810 euros, commercial disturbance of 212,000 euros, reinstallation and communication costs of 184,733 euros, removal and administrative costs of 29,000 euros, and double-rent indemnity of 39,377 euros. The Cour de cassation quashed the award in part, precisely on the last three heads (184,733, 29,000 and 39,377 euros), recalling that “l’indemnité d’éviction comprend notamment la valeur marchande du fonds de commerce, déterminée suivant les usages de la profession, augmentée éventuellement des frais normaux de déménagement et de réinstallation, ainsi que des frais et droits de mutation à payer pour un fonds de même valeur, sauf dans le cas où le propriétaire fait la preuve que le préjudice est moindre” — compensation tracks the market value of the business plus standard removal and reinstallation costs and equivalent transfer taxes, unless the owner proves the loss is smaller. The message for foreign tenants is double-edged and practical: claim every genuine head of loss with invoices and expert valuation, because the principal can be very large; but do not inflate ancillary heads such as communication budgets or double rent without proof, because the supreme court will strike them and you will bear the costs of the extra litigation. In practice, both sides appoint a property valuer (expert en évaluation de fonds de commerce) as soon as the refusal arrives, the tenant stays in the premises paying an occupation indemnity while the amount is fixed, and the official guidance notes the tenant’s three-month deadline to vacate once the compensation is paid (see how the eviction indemnity is assessed). Negotiate from the expert report, not from anger, and never vacate before the money is secured or judicially guaranteed: leaving early destroys your leverage and can be read as acceptance.
B. Rent increases at renewal, three-year revision and the unpaid-rent termination trap
Renewal is not a photocopy of the old rent. Article L.145-33 of the Commercial Code states that “Le montant des loyers des baux renouvelés ou révisés doit correspondre à la valeur locative.” The rent of renewed or revised leases must match the rental value. That value is assessed on five statutory criteria — the characteristics of the premises, their permitted use (destination des lieux), the parties’ respective obligations, local commerciality factors, and prices commonly charged nearby — with a government decree detailing each element. At renewal, the landlord will therefore serve a rent proposal aligned with current local values, and in a street whose footfall has boomed, the uplift can be brutal. The statute then caps the increase through the plafonnement, the capping rule: unless the landlord proves a material change in local commerciality factors that has by itself moved the rental value by more than ten percent, or a contractual change in the tenant’s obligations, the renewed rent cannot exceed the old rent adjusted by the official index variation. Foreign tenants should therefore answer every renewal proposal with two questions: which of the five criteria justifies the figure, and where is the proof of a material change if the landlord seeks to break the cap? Without that proof, the judge fixes the rent within the capped range, and most proposals settle once an independent rental valuation (expertise locative) lands on the table. The same logic governs revision during the lease: article L.145-38 of the Commercial Code provides that “La demande en révision ne peut être formée que trois ans au moins après la date d’entrée en jouissance du locataire ou après le point de départ du bail renouvelé.” A revision claim is available only three years after the tenant took possession or after the start of the renewed lease, with further claims possible every three years, and each revision takes effect from the date of the claim. Diary these windows from abroad: a landlord who misses the three-year date must wait for the next one, and a tenant who receives a revision writ should check the date first, because an early claim fails on that fact alone.
The darkest scenario is simpler: your French company stops paying — cash-flow crisis at headquarters, disputed charges, a manager who overlooked the quarterly appel de loyer, the rent demand. French commercial leases almost always contain a clause résolutoire, an automatic termination clause, and the statute gives it teeth while surrounding it with strict formalities that save tenants who react fast. Article L.145-41 of the Commercial Code provides that “Toute clause insérée dans le bail prévoyant la résiliation de plein droit ne produit effet qu’un mois après un commandement demeuré infructueux.” A clause providing for automatic termination takes effect only one month after a formal payment order (commandement de payer served by a commissaire de justice) has gone unheeded. And the same article adds that “Le commandement doit, à peine de nullité, mentionner ce délai.” The order must state this one-month period, failing which it is void. During that month, the tenant can still pay in full and kill the procedure; even afterwards, judges hearing the case may grant payment delays and suspend the clause where termination has not yet been confirmed by a final judgment. Landlords know this, which is why a commandement usually triggers urgent settlement talks rather than immediate eviction. But the order must be precise to be valid, and the Cour de cassation enforces precision against landlords. In Cass. 3rd civ., 30 March 2017, no. 16-11.970, a landlord had served a termination order demanding all maintenance and repair works, referring to a bailiff’s report that had listed the defects floor by floor and flat by flat. The supreme court upheld annulment of the order, finding that “le commandement du 26 septembre 2008 ne précisait pas les travaux en fonction de leur nature et des lieux sans ventilation entre ceux relevant de l’entretien et de la remise en état” — the order did not specify the works by nature and location, with no breakdown between maintenance and restoration — and that “cette imprécision avait été de nature à créer, dans l’esprit du preneur, une confusion l’empêchant de prendre la mesure exacte des injonctions qui lui avaient été délivrées” — the vagueness confused the tenant and prevented it from grasping exactly what was demanded within the deadline. A commandement that merely says pay everything or fix everything, without saying what and where, is void. And appellate indulgence toward landlords is itself reviewed: in Cass. 3rd civ., 11 March 2021, no. 19-26.346, a dispute over “l’acquisition à la date du 2 janvier 2014 de la clause résolutoire du bail commercial conclu entre Mme [K] et la société Kinoa le 30 août 2013” — whether the automatic termination clause of a commercial lease had vested — ended with the supreme court ordering “CASSE ET ANNULE, en toutes ses dispositions, l’arrêt rendu le 9 décembre 2019” — full quashing of the appeal decision. For a foreign tenant, the operating instructions are therefore clear: open every commandement within days, check the one-month mention, check the precise breakdown of sums and works, pay or cure within the month wherever possible, and if anything is vague, put a lawyer on it immediately rather than testing the clause in court a year later.
Conclusion
Your first French commercial lease is a nine-year partnership that the statute writes mostly in the tenant’s favour — provided the tenant earns that favour through formalities. Incorporate and register before signing so the protected status attaches; refuse unlawful waivers in pure-office leases or accept them with open eyes; use the short-term derogatory lease as a bridge, never as a permanent perch; serve and answer every notice by registered letter or court officer’s writ, never by email; keep the premises genuinely trading through the final three years so the renewal right and the eviction compensation survive; diary the two-year limitation for every lease claim and the three-year windows for rent revision; and treat any payment order as a one-month countdown that rewards fast payers and punishes vague landlords. Each of these reflexes maps to one of the articles and decisions quoted above, and together they turn the 3-6-9 from a foreign founder’s gamble into a managed commercial asset. Paris and Île-de-France add their own layer — the Paris commercial court (Tribunal des activités économiques de Paris), the capital’s valuers and the region’s rental levels — but the statute is national, and the method in this guide works from Lille to Marseille.
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