Compulsory purchase of my business premises: what compensation?

A tramway line, a road, a development zone: the project has been declared to be in the public interest and your business lies on the land to be taken, in whole or for part of the plot. You have received, or will receive, an offer of compensation from the public authority, with a figure that does not match what you are losing. This guide describes the compulsory purchase procedure (expropriation) as a trader experiences it, the rules of the French Expropriation Code that determine what can be compensated, and what a valuation report brings to the submission your lawyer will file before the expropriation judge.

What happens in practice

The procedure has two phases. The administrative phase begins with a public inquiry, then the declaration of public utility (déclaration d’utilité publique). A parcel inquiry then identifies the plots and their owners; this is when tenants and occupiers must be reported and must come forward. The transferability order (arrêté de cessibilité) designates the properties to be taken.

The judicial phase begins with the expropriation order, which transfers ownership to the acquiring authority. The authority serves its offers of compensation on the owner and the occupiers. Each has a period in which to reply and state their claims. Failing agreement, the authority or the expropriated party applies to the expropriation judge of the judicial court (tribunal judiciaire). The authority files a submission (mémoire); the expropriated party replies with a reply submission, costed and accompanied by supporting documents. The Government Commissioner (commissaire du Gouvernement), who is the departmental director of public finances or a representative, gives an opinion. The judge visits the site, holds a hearing and gives a judgment fixing the compensation. An appeal is possible. Possession is taken only after payment or deposit into court of the compensation.

For a trader, two situations exist. Total eviction: the business disappears or must be transferred. Partial eviction: part of the premises, the car park or the land is taken, and the activity continues in the rest, often diminished.

What French law says

The principle. Compensation covers the entire direct, material and certain loss caused by the expropriation (article L. 321-1 of the French Code of Expropriation in the Public Interest).

The dates. Properties are valued according to their condition at the date of the expropriation order (article L. 322-1), and according to their actual use at the reference date, in principle one year before the opening of the public inquiry; changes in value caused by the announcement of the scheme are disregarded (article L. 322-2). Where only part of the land is taken, the classification is assessed with regard to the whole plot (Cass. 3e civ., 6 March 2025, appeal no. 23-22.427).

The business. The Charte de l’expertise en évaluation immobilière (the French property valuation charter) states that a tenant holding a commercial lease is entitled to compensation “the terms of which are established on bases comparable to those of eviction compensation” (6th edition, November 2025, Title III, § 1.20; see also § 1.19): value of the business if it disappears, value of the leasehold right (droit au bail) if it can be transferred, plus the ancillary heads. The value of the business is determined according to the practices of the trade, as for a commercial lease (article L. 145-14 of the French Commercial Code).

Reinvestment. The reinvestment allowance (indemnité de remploi) covers costs of any kind incurred to acquire a replacement property (article R. 322-5).

Trading disturbance. The evicted operator may claim compensation for the trading disturbance (trouble commercial) resulting from the expropriation, provided it is distinct from the loss compensated by the value of the business and reinvestment; in the event of partial eviction, that disturbance may affect the activity continued outside the take, the operator bearing the burden of proof (Cass. 3e civ., 4 July 2024, appeal no. 23-15.027).

The limits. Only a loss based on a legally protected right is compensated (Cass. 3e civ., 15 February 2024, appeal no. 22-16.460). The judge rules within the limits of the parties’ claims; if the expropriated party does not reply, the judge fixes the compensation on the evidence available, without exceeding the Government Commissioner’s proposal (article R. 311-22; Cass. 3e civ., 9 October 2025, appeal no. 24-12.637). An ancillary claim, such as a loss of rental income, may be made for the first time on appeal (Cass. 3e civ., 9 April 2026, appeal no. 24-15.296).

What a valuation report changes

The report first identifies what is being taken: the premises, the lease, the business, or only a part. It checks that each element rests on a protected right, with permits and authorisations in support. It then classifies the business, transferable or not, and quantifies the principal compensation: value of the business by the cross-checked methods of turnover, restated EBITDA and comparable sales, or value of the leasehold right. In the event of partial eviction, it values the business before and after, and the difference is the partial value lost.

It then quantifies each ancillary head with its supporting document: reinvestment according to the scale, removal and reinstallation on quotes, trading disturbance from the accounts, reorganisation, loss of parking or display area. It analyses the acquiring authority’s offer and the State valuer’s opinion (avis du Domaine), and presents a closed calculation, reference by reference, that the judge can follow. This report is appended to the reply submission drafted by the lawyer, and I attend the site visit to answer the judge and the Government Commissioner.

What it does not do: it does not interrupt any procedural time limit, it cannot obtain compensation for what rests on no right, and it does not replace the lawyer for the submission and the hearing.

A worked example

A bicycle shop in Brest, owner of its business and tenant of its premises. The extension of a transport line takes 40 % of the plot: the customer car park and the repair workshop. The shop remains outside the take. The acquiring authority offers €60,000 for the partial value of the business, €6,000 for reinvestment, and nothing for the rest.

The report values the business before the scheme at €300,000, on turnover of €600,000 and restated EBITDA of €80,000. Without the car park or the workshop, foreseeable turnover falls by a quarter and the workshop, which accounts for 40 % of the margin, has to be rehoused: the business after the scheme is valued at €180,000. Partial value lost: €120,000. Reinvestment according to the scale: €1,000 on the first €5,000, €1,500 on the next €10,000, €10,500 on the remainder, that is €13,000. Reinstallation of the workshop in nearby premises, on quote: €30,000. Trading disturbance during six months of works and reorganisation, established from the accounts and distinct from the previous heads: €25,000. Total: €188,000, against €66,000 offered.

The report, on the other hand, sets aside an extension of the workshop built without a prior declaration, which the trader wished to have compensated: it rests on no protected right.

Common mistakes

• Not replying to the offers and not filing a submission, which limits the judge to the Government Commissioner’s proposal.
• Not making yourself known to the acquiring authority during the inquiry, when you are a tenant.
• Claiming compensation for a building erected without a permit.
• Presenting the trading disturbance as a flat-rate percentage, without accounts or quotes, when the burden of proof is on the operator.
• Counting the same loss twice, in the value of the business and then in the trading disturbance.

What to gather

• Notice of inquiry, declaration of public utility, transferability order, expropriation order.
• The acquiring authority’s offers and, if you have it, the State valuer’s opinion.
• Lease and amendments, or title deed.
• Last three balance sheets, monthly turnover, breakdown by activity.
• Plans showing the line of the take, permits and authorisations for the buildings.
• Quotes for removal, reinstallation, works.
• Dated photographs of the condition of the premises before the works.
• Employment contracts and staff register.

Timeframe and fee

The service is described on the Compulsory purchase and pre-emption page. The report is delivered in three weeks, a timeframe that can be adapted to the procedural calendar. It is billed on time spent, at €65 per hour, most often from €975 (15 h) excluding travel, charged at €65 per hour or part hour from PONT-L’ABBÉ. Attendance at the site visit and additional notes during the proceedings are 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.