Employment & Labour Law
There are exceptions to this preferential right in the case of : (i) a single sale of a group of commercial premises, (ii) a single sale of several premises let to different tenants, (iii) a global sale of a building including commercial premises and (iv) a sale of a premises to one's spouse, ascendant or descendant or those of one's spouse; but this is not the issue in the judgment in question.
In its ruling of 29 June 2023, the Court of Cassation reiterated that premises used for industrial purposes are excluded from the scope of article L.145-46-1 of the Commercial Code; there is therefore no preferential right for the lessee of premises used for industrial purposes.
This decision is not new, as article L.145-46-1 of the French Commercial Code is clear about its scope: these provisions apply to the owner of premises used for commercial or craft purposes.
Article L.145-46-1 of the French Commercial Code, which is of public policy, gives the lessee a real advantage.
It is therefore understandable that a lessee of commercial premises would try to take advantage of article L.145-46-1 of the French Commercial Code, especially as the definition of premises for industrial use is not stipulated in the texts.
This is why the Court of Cassation took a position on the definition of premises for industrial use in its ruling of 29 June 2023.
Until then, the Court of Cassation had not had the opportunity to rule on the concept of premises for industrial use.
Industrial premises are defined as "any premises used primarily for an activity that contributes directly to the manufacture or transformation of movable tangible property and for which the technical installations, equipment and tools used play a predominant role" (Cass. 3rd civ., 29 June 2023: RG n°22-16.034).
The Orléans Court of Appeal, whose decision was the subject of the appeal, had ruled along these lines in its judgment of 10 March 2022, holding that, in order to exclude the application of article L. 145-46.1 of the French Commercial Code, :
The main activity of manufacturing breeze blocks was an industrial activity.
Following an amendment by the rapporteur of the National Assembly's Economic Affairs Committee, the words "premises used for commercial or craft purposes" had been added to article L. 145-46-1 of the Commercial Code; this amendment was therefore intended to exclude industrial premises, which are therefore not intended to fall within the scope of the preferential right (CA Orléans, 10 March 2022: RG n°20/01235).
Despite the exclusion of premises used for industrial purposes from article L. 145-46-1 of the French Commercial Code, it is of course still possible to contractually provide for a preferential right in favour of a lessee with an industrial activity.
This contractual stipulation will only be possible if the lessor agrees to provide for it.
When negotiating a commercial lease for industrial use, the future lessee should consider whether it intends to acquire the premises in the event of a sale by the future lessor, so that this can be included in its negotiations with the lessor.
