Lease renewal in France: my landlord wants to uncap the rent

Your French commercial lease (bail commercial, the 3-6-9 lease) is coming to an end and a court bailiff (commissaire de justice) has served you with notice offering renewal. The landlord agrees to keep you, but at a rent far above what you pay now, relying on déplafonnement (release of the renewal rent from the statutory cap). You do not know whether the demand is well founded, what the premises are really worth, or what you risk by refusing. This guide describes the procedure, the rules of the French Commercial Code and what a rental value report brings, whether to negotiate or to go before the commercial rent judge.

What happens in practice

At least six months before the end of the lease, the landlord may serve notice offering renewal, stating the rent it proposes (article L. 145-9 of the French Commercial Code). The tenant can also take the initiative by requesting renewal (article L. 145-10). In both cases the principle of renewal is settled; only the rent remains to be fixed.

The discussion begins with an exchange of letters. If no agreement is reached, the more diligent party has a written submission (mémoire) served on the other, then applies to the commercial rent judge, who is the president of the judicial court (tribunal judiciaire). The judge very often appoints a court expert, who convenes the parties, visits the premises, examines the references and files a report. The judgment fixes the rent with effect from the renewal date. Each party then has one month, after the final decision, to exercise its right of option: the tenant may waive renewal, the landlord may refuse to renew against payment of eviction compensation (indemnité d’éviction, the statutory compensation due to the tenant when renewal is refused).

Throughout the proceedings the tenant pays the old rent or a provisional rent. The difference from the final rent is due retroactively.

What French law says

The principle: the cap. For a nine-year lease, the change in the renewal rent may not exceed the change in the commercial rent index (ILC) or the tertiary activities rent index (ILAT) since the rent of the expired lease was first fixed (article L. 145-34).

The cases of uncapping. The rent is fixed at the rental value where one of the first four elements of article L. 145-33 has changed materially during the expired lease: characteristics of the premises, permitted use, the parties’ respective obligations, local commercial factors. It is also fixed at the rental value where the lease has a contractual term of more than nine years, or where it has continued by tacit extension beyond twelve years. Single-purpose premises and offices follow their own rules (articles L. 145-36, R. 145-10 and R. 145-11).

The material change. A change in local commercial factors justifies uncapping if it is of a kind to have a favourable effect on the business actually carried on, without any need to prove a rise in turnover (Cass. 3e civ., 18 September 2025, appeal no. 24-13.288). A new statutory obligation placed on the landlord during the expired lease also counts (Cass. 3e civ., 23 January 2025, appeal no. 23-14.887). The Orléans Court of Appeal accepted a 30 % rise in tramway ridership and a change in the street’s customer base (CA Orléans, 4 April 2019, RG no. 18/007151).

The rental value. It is determined from the five elements of article L. 145-33, detailed in articles R. 145-3 to R. 145-8. Charges normally borne by the landlord and transferred to the tenant, such as property tax, are a factor reducing the rent (article R. 145-8; Cass. 3e civ., 29 January 2026, appeal no. 24-17.227). The Charte de l’expertise en évaluation immobilière (the French property valuation charter) defines market rental value (6th edition, November 2025, Title III, § 1.4) and recommends weighting ranges for retail floor areas.

Smoothing. In case of material change or of a clause on the term of the lease, the increase may not exceed 10 % of the previous year’s rent in any one year (article L. 145-34, last paragraph). This smoothing does not apply to a lease tacitly extended beyond twelve years (Cass. 3e civ., 16 October 2025, appeal no. 23-23.834).

Time limits. Actions relating to the rent are time-barred after two years (article L. 145-60).

What a valuation report changes

The report answers two questions in order. First: is uncapping established? It documents, with dated facts, what changed during the expired lease, in the premises, in the neighbourhood, in the parties’ obligations, and says whether that amounts to a material change within the meaning of the case law. Second: what is the rental value? It reduces the premises to a weighted floor area, gathers references of renewal rents and new lettings, with address, date and area, then applies the adjustments called for by the lease clauses. It also calculates the capped rent from the index, so that both figures are on the table.

The report is used to negotiate with figures, to draft the written submission, to steer the court expert’s remit and to prepare the dires (a party’s written observations to the expert). A report commissioned by one party alone is admissible but must be corroborated by other evidence (Cass. ch. mixte, 28 September 2012, appeal no. 11-18.710). It does not fix the rent, it does not replace the lawyer, and it does not guarantee the figure the judge will adopt.

A worked example

A clothes shop in the centre of Quimper, 80 m² weighted, current rent €18,000 per year. The notice proposes €32,000, citing the pedestrianisation of the street and the opening of a neighbouring car park during the lease.

The capped rent, calculated from the change in the index over nine years, comes to €20,500. The report adopts references of €300 to €360 per weighted m² in the area, €330 on average, and a gross rental value of €26,400. The lease transfers property tax to the tenant, which justifies a reduction: rental value adopted, €25,000.

If the change in local commercial factors is held to be material, the rent is uncapped to €25,000, with smoothing: €19,800 in the first year, €21,780 in the second, €23,958 in the third, then €25,000. If it is not, the rent stays at €20,500. Between the landlord’s offer and the capped rent, the gap is €11,500 per year, more than €100,000 over nine years. Between the offer and the demonstrated rental value, it is still €7,000 per year. The report places the negotiation between €20,500 and €25,000, not between €18,000 and €32,000.

Common mistakes

• Letting the lease run beyond twelve years without requesting renewal: uncapping becomes automatic, without smoothing.
• Accepting a “market” rent without first checking whether uncapping is established.
• Comparing raw rents from new lettings, without weighting the floor areas or allowing for the lease clauses.
• Forgetting that property tax and charges transferred to the tenant reduce the rental value.
• Not setting aside the retroactive difference during the proceedings.

What to gather

• Original lease, amendments and any earlier lease.
• Notice or request for renewal, with the date of service.
• Current rent, reference index and latest indexations.
• Plans, floor areas by zone, photographs of the premises.
• Works carried out during the lease, by whom and on what terms.
• Property tax and charges recharged to you.
• Turnover for the last three financial years.
• Information on how the neighbourhood has changed: transport, public works, neighbouring retailers.

Timeframe and fee

The service is the rental value report described on the Commercial rent and leases page. It is delivered three weeks after the visit and billed on time spent, at €65 per hour, most often from €975 (15 h and more) excluding travel, charged at €65 per hour or part hour from PONT-L’ABBÉ. A critical review of an opposing report is billed from €975. Assistance before the court expert is the subject of a separate quote. 50 % deposit, VAT not applicable (article 293 B of the French General Tax Code). The schedule is on the Fees page.