{"id":2125803,"date":"2026-09-20T10:58:02","date_gmt":"2026-09-20T08:58:02","guid":{"rendered":"https:\/\/kohenavocats.fr\/2026\/09\/20\/foreign-owner-france-cofounder-deadlock-exclusion-abuse-majority-abroad\/"},"modified":"2026-09-20T10:58:02","modified_gmt":"2026-09-20T08:58:02","slug":"foreign-owner-france-cofounder-deadlock-exclusion-abuse-majority-abroad","status":"publish","type":"post","link":"https:\/\/kohenavocats.fr\/en\/2026\/09\/20\/foreign-owner-france-cofounder-deadlock-exclusion-abuse-majority-abroad\/","title":{"rendered":"Your Co-Founder Is Blocking Your French Company and You Live Abroad: Deadlock, Abuse of Majority, Forced Exclusion and How to Take Back Control"},"content":{"rendered":"

You invested from London, Dubai or New York in a French company, and the partner who was supposed to run it on the ground has turned against you. He votes down every resolution, refuses the capital increase the business needs, signs contracts you never approved, or simply stops calling meetings while the money keeps moving. From three thousand kilometres away, you feel powerless, and your French partner is counting on exactly that feeling. French company law is not powerless, however. It gives the trapped associate a complete toolbox: court action against abusive majority or minority votes, dissolution when disagreement genuinely paralyses the company, a court-appointed provisional administrator to keep the business alive, forced exclusion of a disruptive partner in an SAS (société par actions simplifiée<\/em>, the flexible simplified joint-stock company foreigners use most), strict controls on share transfers in a SARL (société à responsabilité limitée<\/em>, the closed limited liability company), and an emergency judge who can intervene within weeks. This guide explains each remedy, the exact proof French courts demand, and how to activate them while living abroad, with the most recent decisions of the Court of Cassation quoted word for word.<\/p>\n

I. My Business Partner Voted Against Our Company: How French Courts Judge Abuse of Majority and Abuse of Minority When You Live Abroad<\/h2>\n

A. Your Majority Partner Crushes You: Proving Abuse of Majority as a Foreign Minority Holder<\/h3>\n

Every company in France must be managed in its intérêt social<\/em>, its corporate interest, and for the common benefit of all its members. Article 1833 of the Civil Code states it plainly: \u201cToute société doit avoir un objet licite et être constituée dans l’intérêt commun des associés. La société est gérée dans son intérêt social, en prenant en considération les enjeux sociaux et environnementaux de son activité.\u201d<\/a> When the majority uses its votes to serve itself instead of the company, French courts call it abus de majorité<\/em>, abuse of majority, and they punish it. Your right to fight back starts with Article 1844 of the Civil Code: \u201cTout associé a le droit de participer aux décisions collectives.\u201d<\/a> No majority can strip you of that participation, and no distance between your home abroad and the registered office (siège social<\/em>) in France weakens it.<\/p>\n

The freshest statement of the test comes from the Commercial Chamber of the Court of Cassation on 26 November 2025 (Cass. com., 26 Nov. 2025, No. 24-15.730<\/a>). In that case, the majority of the Nerim group had pushed through a balance-sheet provision of 22 million euros, then a reduction of the capital to zero followed by a reserved capital increase, a classic coup d’accordéon<\/em> that wipes out the minority, all presented as the execution of a conciliation protocol approved by the Paris commercial court. The minority shareholder sued for abuse of majority. The majority answered that a decision taken under a court-approved conciliation agreement was necessarily in the corporate interest. The Court of Cassation rejected that defence entirely. It approved the court of appeal for holding that the transaction had been presented on a distorted picture of the company’s finances, so that \u201cl’opération litigieuse, qui avait été décidée dans le seul dessein de favoriser les majoritaires au détriment des minoritaires, n’était pas conforme à l’intérêt de la société et caractérisait en conséquence un abus de majorité\u201d<\/em>. The minority holder obtained 2,523,591 euros for the loss caused by the abuse plus 300,000 euros for moral harm. Three lessons matter for you. First, even a court-approved restructuring does not whitewash a vote designed to favour the majority. Second, the test is twofold: a decision contrary to the company’s interest, taken with the sole design of favouring the majority at the minority’s expense. Third, the remedy pays: French courts award full compensation for the dilution and can add moral damages.<\/p>\n

Minority holders typically ask the court both to annul the tainted resolution and to award damages. That is exactly how claims are framed today: in spring 2026, before the Montpellier court of appeal, a diluted minority holder asked for the annulment of two general meetings for abuse of majority and about 198,000 euros for what she called a forced dilution (CA Montpellier, 7 Apr. 2026, RG 24\/04832). Whether you seek annulment, damages or both, your file must contain the same backbone: the convening notices, the full minutes showing how each side voted, the accounts before and after the disputed operation, and every letter in which you protested. From abroad, send those protests by registered letter with acknowledgement of receipt (lettre recommandée avec accusé de réception<\/em>) to the registered office, keep the originals, and have your Paris lawyer centralise them. A majority that votes against the corporate interest while you can prove it on paper is a majority that will pay.<\/p>\n

B. Your Partner Blocks Every Decision With Half the Votes: Abuse of Minority and Fifty-Fifty Deadlock<\/h3>\n

The mirror situation is just as common in Franco-foreign joint ventures: you hold the majority or share power fifty-fifty, and your partner answers \u201cno\u201d to everything, a capital increase the company needs to survive, a change of business purpose, the approval of the annual accounts. French law punishes that blockage too, under the name abus de minorité<\/em> or abus d’égalité<\/em>. The leading recent authority is a Court of Cassation decision of 13 March 2024 (Cass. com., 13 Mar. 2024, No. 22-13.764<\/a>). A minority company, Selima, had refused to change the corporate purpose of the Houdec company after the franchise and supply contracts that were its whole activity had been lawfully terminated, a change the company’s survival required. The Court quashed the appeal judgment that had tolerated the refusal and restated the test in terms you can use as a checklist: \u201cL’existence d’un abus de minorité suppose que la preuve soit rapportée, d’un côté, que l’attitude du minoritaire est contraire à l’intérêt général de la société en ce que celui-ci interdit la réalisation d’une opération essentielle pour elle et, de l’autre, qu’elle procède de l’unique dessein de favoriser ses propres intérêts au détriment des autres associés.\u201d<\/em> Two cumulative proofs, therefore: the blocked operation must be essential for the company, and the blockage must serve only the blocker’s personal interests against the other members. Note the visa of the decision as well: statutory amendments belong to the members, not to the manager, under Article L. 223-30 of the Commercial Code, and every company exists in the common interest of its members under Article 1833 of the Civil Code. A partner who freezes an essential amendment to defend a parallel personal business is the textbook case.<\/p>\n

In a fifty-fifty company, the same logic applies under the label of abus d’égalité<\/em>: the partner whose systematic refusal prevents an operation the company’s survival demands commits a fault, and the court can neutralise the blockage. Your practical work from abroad is identical in both cases. Identify one essential operation, for example the capital increase without which the auditors will flag a going-concern risk, or the approval of accounts without which no dividend and no filing at the greffe<\/em> (the registry office of the commercial court, which keeps the RCS, the registre du commerce et des sociétés<\/em>, the French companies register) is possible. Put the partner on written notice to vote, convene the meeting properly, record the refusal in minutes, and gather the documents proving the operation was vital: auditor’s warnings, bank letters conditioning a loan on fresh equity, unpaid supplier ultimatums. Courts judge abuse on documents, not on shouting, and a foreign holder who produces a clean paper trail wins the same way a Parisian one does.<\/p>\n

When neither side can win a vote and the company drifts, do not wait for the drift to become a disaster. The next section gives you the two collective remedies French law reserves for paralysed companies: court-ordered dissolution, which kills the company and must stay a last resort, and the provisional administrator, which keeps it alive while the judges sort out the merits.<\/p>\n

II. From Paralysis to Exit: Dissolution, Provisional Administrator and Forcing Your Partner to Sell His Shares<\/h2>\n

A. When the Company Can No Longer Function: Court-Ordered Dissolution as a Last Resort and the Provisional Administrator as a Lifeline<\/h3>\n

Article 1844-7, 5\u00b0 of the Civil Code allows any member to ask the court for early dissolution \u201cpour justes motifs, notamment en cas d’inexécution de ses obligations par un associé, ou de mésentente entre associés paralysant le fonctionnement de la société\u201d<\/a>. Disagreement alone is never enough. The Court of Cassation said so firmly on 5 April 2018 (Cass. com., 5 Apr. 2018, No. 16-19.829<\/a>), quashing a court of appeal that had dissolved a family holding on the ground of lasting disagreement and lost trust. The rule applied is strict: \u201cla mésentente existant entre les associés ne peut constituer un juste motif de dissolution qu’à la condition d’entraîner une paralysie du fonctionnement de la société\u201d<\/em>, and in that case the appeal judges had themselves found that the absence of any blockage of the company’s functioning was established. You must therefore prove a genuine, present paralysis: no general meeting can validly deliberate, the accounts cannot be approved, the manager cannot act, or two rival camps file contradictory documents with the town hall in the company’s name. Bitterness, distrust and even a three-year-old unresolved dispute inside the group do not meet the test if resolutions can still technically pass. And remember the strategic cost: dissolution liquidates the very asset you invested in, pays the creditors first, and often leaves the members with the leftovers. Ask for it only when the company is truly unworkable and you have priced that outcome.<\/p>\n

The smarter emergency remedy is the administrateur provisoire<\/em>, the provisional administrator, a neutral outsider the court appoints to run the company temporarily when a crisis threatens it with imminent harm. The Paris court of appeal confirmed such an appointment on 22 March 2024 in a fifty-fifty real-estate company where the two camps no longer spoke to each other (CA Paris, Pôle 1, ch. 8, 22 Mar. 2024, RG 23\/15250, full decision<\/a>). The rented property’s income was the company’s only revenue, and the judges found a real risk that it could no longer repay its bank loan of 5,619.59 euros per month and pay its operating costs, while the manager herself proposed selling the building given, in her words, the deterioration of relations. On those findings, \u201cla décision de désignation d’un administrateur provisoire sera confirmée\u201d<\/em>. But the same decision draws the line you must respect: the administrator cannot rewrite the company’s statutes or settle who really owns the shares, because \u201cla question de la modification des statuts ne peut relever que du juge du fond\u201d<\/em>. The emergency judge stops the bleeding; only the trial judge decides the substance. For a foreign owner, the sequence is therefore: administrator now to protect the cash and the assets, full action on the merits next to settle the ownership fight.<\/p>\n

B. Making Your Partner Sell: SAS Exclusion Clauses, Price Fixing and the Emergency Judge When You Live Abroad<\/h3>\n

If your company is an SAS, French law offers the most powerful weapon of all: forcing the disruptive partner to sell his shares and leave. Article L. 227-16 of the Commercial Code provides that \u201cDans les conditions qu’ils déterminent, les statuts peuvent prévoir qu’un associé peut être tenu de céder ses actions. Ils peuvent également prévoir la suspension des droits non pécuniaires de cet associé tant que celui-ci n’a pas procédé à cette cession.\u201d<\/a> Read that twice: the statutes themselves, the contract you signed at incorporation, can oblige a member to transfer his shares and can suspend his voting rights until he does. A parallel provision, Article L. 227-17, covers the partner whose own control changes hands: the company \u201cpeut décider, dans les conditions fixées par les statuts, de suspendre l’exercice des droits non pécuniaires de cet associé et de l’exclure\u201d<\/a>. The exclusion must follow the procedure your statutes describe, respect the member’s right to defend himself before the vote, and state precisely which breaches trigger it: competition with the company, criminal conviction, loss of a professional licence, persistent obstruction of corporate bodies, or any objective event you draft today while relations are still calm. An exclusion clause written after the conflict has started is worth far less than one written at incorporation, which is why every foreign founder should have this clause reviewed before the first euro is wired.<\/p>\n

The price of the forced sale is where most fights restart, and the statute settles it in advance. Article L. 227-18 of the Commercial Code states that \u201cSi les statuts ne précisent pas les modalités du prix de cession des actions lorsque la société met en oeuvre une clause introduite en application des articles L. 227-14, L. 227-16 et L. 227-17, ce prix est fixé par accord entre les parties ou, à défaut, déterminé dans les conditions prévues à l’article 1843-4 du code civil.\u201d<\/a> Either you agree on the price, or an independent expert sets it. Article 1843-4 of the Civil Code organises that expertise: \u201cla valeur de ces droits est déterminée, en cas de contestation, par un expert désigné, soit par les parties, soit à défaut d’accord entre elles, par jugement du président du tribunal judiciaire ou du tribunal de commerce compétent, statuant selon la procédure accélérée au fond et sans recours possible.\u201d<\/a> The expert must apply the valuation rules your statutes or your shareholders’ agreement (pacte d’associés<\/em>) already contain, so draft a valuation formula now: multiple of normalised operating profit, net asset value, or a contractual floor. Without a formula, the expert decides freely, and experts are neither quick nor cheap. If the company itself buys back the shares, it must resell them within six months or cancel them.<\/p>\n

A decisive 2023 decision protects exclusion mechanisms against a classic counter-attack. The ousted partner often argues that the forced sale violates the statutes and is therefore void. Article L. 227-15 of the Commercial Code does say that \u201cToute cession effectuée en violation des clauses statutaires est nulle.\u201d<\/a> But on 21 June 2023, the Court of Cassation drew a sharp line between voluntary sales and forced exits (Cass. com., 21 June 2023, Nos. 21-25.952 and 22-12.045<\/a>). A shareholders’ pact had provided that a defaulting party, after a thirty-day cure notice, irrevocably undertook either to buy all the victim’s shares or to sell all its own, and the victim demanded the sale of 344,285 shares for 328,497.73 euros under penalty (astreinte<\/em>). The court of appeal had blocked the sale by mixing the pact’s buy-or-sell promise with the statutes’ exclusion clause. The Court of Cassation quashed that reasoning and held: \u201cCe texte ne régissant pas l’exclusion d’un associé et la cession forcée de ses actions qui en résulte, la nullité qu’il prévoit vise uniquement à sanctionner la violation de toute clause statutaire ayant pour objet la cession d’actions librement consentie par leur titulaire.\u201d<\/em> In plain terms, the nullity for breach of transfer clauses punishes only voluntary transfers made in breach of the rules; it does not swallow exclusion procedures and forced sales, which live under their own regime. A well-drafted pact promise to buy or sell on a triggering event is enforceable, even by court order under penalty. For a foreign owner, the message is operational: sign a detailed shareholders’ agreement alongside the statutes, with buy-or-sell triggers, cure periods, price formula and penalty, because French courts enforce it to the letter.<\/p>\n

If your company is a SARL rather than an SAS, the geometry is different and you must know it before choosing your remedy. A SARL has no statutory exclusion of a member. What it has is a strict lock on exits: Article L. 223-14 of the Commercial Code provides that \u201cLes parts sociales ne peuvent être cédées à des tiers étrangers à la société qu’avec le consentement de la majorité des associés représentant au moins la moitié des parts sociales\u201d<\/a>, unless the statutes demand a higher majority. The draft sale must be notified to the company and to every member; \u201cSi la société n’a pas fait connaître sa décision dans le délai de trois mois\u201d<\/em>, consent is deemed granted, and if consent is refused, the remaining members must buy the shares, have the company buy them with a capital reduction, or let the original sale proceed, with payment delays of up to two years available from the court. Practically, a SARL owner cannot expel a partner the way an SAS can; he negotiates the departure, uses the approval procedure to control who enters, or converts the vehicle where the statutes allow. Foreign founders who anticipate conflict therefore overwhelmingly prefer the SAS, precisely for its exclusion clauses.<\/p>\n

All of this is actionable without moving back to France, through the emergency judge, the juge des référés<\/em>. Article 873 of the Code of Civil Procedure empowers the president of the court to \u201cprescrire en référé les mesures conservatoires ou de remise en état qui s’imposent, soit pour prévenir un dommage imminent, soit pour faire cesser un trouble manifestement illicite\u201d<\/a>, and to grant a provision where the obligation is not seriously disputable. Freeze a suspicious bank mandate, suspend a disputed meeting, appoint the provisional administrator, order the production of the accounts: these are r\u00e9f\u00e9r\u00e9 measures. File before the commercial court of the company’s registered office, in Paris if your seat is in Paris or the \u00cele-de-France region, through a Paris lawyer holding your written authority; the court works on documents, and distance changes nothing about the merits. Your emergency file should already contain the Kbis, the official company identity extract issued by the greffe<\/em> proving who can legally bind the company, the up-to-date statutes, the shareholders’ agreement, the disputed minutes and your prior written protests. Our setting-up guide for foreign founders describes the bank account, Kbis, VAT and first-hire foundations<\/a> every French company rests on, and a deadlock file is exactly where those foundations are tested.<\/p>\n

Conclusion<\/h2>\n

A co-founder conflict in a French company is not a private quarrel; it is a legal situation with a strict grammar. An abusive vote is judged against the corporate interest and the equality of members, with recent Court of Cassation decisions awarding millions to diluted minorities and quashing blockages of essential operations. A lasting disagreement dissolves the company only if it truly paralyses it, which courts verify harshly before killing the business. Between those poles, the provisional administrator keeps the company breathing, the SAS exclusion clause removes the troublemaker for a judicially controlled price, the SARL approval procedure controls every entry and exit, and the emergency judge acts fast on documents alone. Living abroad changes the logistics, a Paris lawyer, registered letters, a complete documentary file, never the rights. Assemble the file today, trigger the clause your statutes contain, and let the judge do the rest: the partner who counted on your absence will discover that French company law crosses borders very well.<\/p>\n

Need a quick opinion on your case<\/h2>\n

Your co-founder blocks every decision, diverts the business or refuses to sell, and you run your French company from abroad. Call 06 46 60 58 22<\/a> for a telephone consultation within 48 hours with a lawyer of the firm, or write via our contact page<\/a>. Bring your statutes, your shareholders’ agreement, the disputed minutes and your latest Kbis: we will tell you whether the vote is abusive, whether exclusion or dissolution is available, and what to file first.<\/p>\n","protected":false},"excerpt":{"rendered":"

Your French business partner blocks every vote or crushes you as a minority holder while you live abroad. 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