A partners' agreement between a father and his five children, all of whom are partners in an SAS that is a member of a group, and specifying the measures to be implemented when the father is no longer a partner in the SAS so that the group remains within the family, is concluded for the duration of the company, i.e. for the time remaining until the expiry of 99 years from the date of registration of this company in the RCS, i.e. 58 years. It also provides that, at the end of this initial period, it will be automatically and tacitly renewed for the new duration of the company, which may be extended, and that, at the time of each renewal, any party may terminate the agreement insofar as it is concerned, by notifying the other parties of its decision at least six months in advance. A clause in the pact specifies that the pact will bind and benefit the heirs, legatees, successors, assigns of each of the parties, and in particular their family holdings, as well as their legal representatives.

At the request of several signatories to the agreement, who argue that they will only be able to leave it at a particularly advanced age (between 79 and 96 years depending on the signatories), a court of appeal rules that this duration, which confiscates any real possibility of ending the agreement for the partners, is excessive and opens up the possibility for the parties to terminate this agreement unilaterally at any time (application of Articles 1210 and 1211 of the Civil Code, pursuant to which each party may terminate perpetual or indefinite-term commitments at any time).

Wrongly, according to the Cour de cassation. Indeed, it follows from the combination of Articles 1134, para. 1 in its then applicable wording (taken up by Article 1103, providing that contracts or agreements legally formed take the place of law to those who made them) and 1838 (according to which the duration of the partnership cannot exceed 99 years) of the Civil Code that the prohibition of perpetual commitments does not prohibit the conclusion of a partners' agreement for the life of the partnership, so that the parties cannot unilaterally terminate it.

Pursuant to the law of 14 February 2022 in favour of independent professional activity (Law 2022-172 of 14-2-2022 art. 7: BRDA 6/22 inf. 24), an ordinance, which has just been published, simplifies and groups together the cross-cutting texts applicable to the regulated liberal professions (Ord. 2023-77 of 8-2-2023).

Professions subject to a legislative or regulatory status or whose title is protected include approximately 700,000 professionals in various sectors (lawyers, veterinarians, accountants, etc.). Each of these professions is governed by specific texts, which lay down specific requirements in terms of professional ethics. In addition, cross-cutting provisions, which in particular lay down the procedures for practising in the form of a company (professional civil partnerships, liberal practice companies, etc.), are applicable to them. The successive reforms of these texts have led to an overlap and tangle of legal regimes, generating both complexity and confusion.

The ordinance aims to rationalise and clarify the regulation of companies enabling regulated liberal professions to carry out their activity, by merging all the cross-cutting texts applicable to them into a single text. This measure will not come into force, for the most part, until 1 September 2024. A period of one year from that date is provided to allow certain existing companies to comply with the new measures.

The regulated liberal professions will be grouped into three families: the health professions, the legal and judicial professions and the technical and living environment professions (chartered accountants, auditors, architects, surveyors, etc.).

In particular, the 1966 law relating to professional civil companies (Law 66-879 of 29-11-1966) and the 1990 law governing liberal practice companies, multidisciplinary practice companies, liberal profession financial participation companies (SPFPL) and liberal profession joint ventures (Law 90-1258 of 31-12-1990) will be repealed. The ordinance largely incorporates the substance of these laws, but some provisions have been modernised, such as that of the SPFPL, whose scope has been broadened. Provisions aimed at greater transparency of company governance vis-à-vis the competent licensing authorities or professional orders are also introduced.

Interest paid to partners or shareholders on sums they make available to the company in addition to their share of the capital is deductible from taxable income up to the limit of the average effective rate charged by credit institutions for variable-rate loans to companies with an initial term of more than two years. For the fourth quarter of 2022, the average effective rate charged by credit institutions for variable-rate loans to businesses with an initial term of more than two years is 3.36% (OJ of 28-12).

With the rates for the 1st to 4th quarters of 2022 amounting to 1.15%, 1.96%, 2.38% and 3.36% respectively, the maximum deductible interest rate is set at 2.21% for companies whose financial year ending on 31 December 2022 coincides with the calendar year.

Companies that will close a financial year ending 31 December 2022 to 30 March 2023 inclusive during the first quarter of 2023 can now find out the maximum rate of deduction they will be able to claim in respect of that year.

In an unprecedented decision, the Cour de cassation rules that the transfer of the usufruct of company rights, which does not entail the transfer of ownership of the company rights, is not subject to the proportional registration duty provided for in Article 726 of the CGI applicable to transfers of company rights.

The result is that the deed recording the transfer of the temporary usufruct of shares in companies with a preponderance of real estate is registered subject only to the payment of the fixed duty of €125 provided for in Article 680 of the CGI (and escapes the 5% duty).

The Court based its decision on the provisions of Article 578 of the Civil Code, according to which "usufruct is the right to enjoy things owned by another, like the owner himself, but with the obligation to preserve their substance" and deduced that the usufructuary of company shares cannot be recognised as a partner, which belongs only to the bare owner, so that the transfer of the usufruct of company rights cannot be qualified as a transfer of company rights. It thus draws the consequences, from a tax point of view, of the judgment of 16 February last (and of the opinion that preceded it) having denied the status of partner to the usufructuary of corporate rights, which belongs only to the bare owner ( Cass. com. opinion 1-12-2021 no 20-15.164 FS-D; Cass. 3e civ. 16-2-2022 no 20-15.164 FS-B).

A distributor of consumer electronics products who has had a commercial relationship with a supplier for twelve years on the basis of commercial terms renegotiated annually is notified of the termination of their relationship with fifteen months' notice. He brings an action against the supplier for liability for the brutal termination of established commercial relations because the latter did not maintain the previous commercial conditions during the notice period granted.

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His claim is dismissed.

Where the terms of the established commercial relationship between the parties are the subject of annual negotiation, changes made during the period of notice which are not so substantial as to undermine the effectiveness of the notice period do not constitute a brutal breach of that relationship.

For some particular conditions, the distributor had not shown that they were a usual practice between the parties before the termination and, for others, it was not established that they had been removed by the supplier during the notice period; for a last series of commercial conditions, relating to the mode of supply, the supplier negotiated the commercial conditions with its distributors annually, so that it was normal that they could evolve, including during the execution of the notice period; the parties had negotiated annually, during the notice period, the specific conditions binding them, so that the distributor could not claim unlimited application over time of temporary favourable commercial conditions granted for one year and necessarily called into question by the principle of annual negotiation between the parties.

Any contract for the sale of agricultural products delivered on French territory must, in principle, be concluded in written form; the contract is then for a period of three years and must contain a certain number of clauses, such as those relating to the price and the terms of its automatic revision (C. rur. art. L 631-24 amended by Law 2021-1357 of 18-10-2021, known as "Egalim 2").

As permitted by the Egalim 2 law (C. rur. art. L 631-24-2, al. 1 amended), a decree, taken after consultation with the professional organisations concerned, establishes the list of products and categories of products for which, by way of derogation, the sales contract (or the framework agreement, in the case of a mandate to a producer organisation) may not be concluded in written form. These products and categories of products are defined with regard to the list in Annex I of European Regulation 1308/2013 of 17 December 2013 on the common organisation of the markets in agricultural products ("CMO Regulation"), which corresponds to the one concerned by the written contractualisation obligation.

1° Derogations from the principle of written contractualisation must, in principle, be provided for by an extended inter-trade agreement. It is only in the absence of such an agreement that the derogations are listed by decree (C. rur. art. L 631-24-2, al. 1 modified).

2° If the contract is nevertheless concluded in written form, it is governed by the provisions relating to compulsory written contracts, except as regards the duration of the contract, which may therefore be less than three years (same art.).

A fruit and vegetable supplier supplies forty-three shops operating under the Leader Price banner and operated either directly by the company at the head of the distribution network or by independent third-party companies linked to the company by concession or franchise agreements.

As all the shops had ceased to be supplied by it, the supplier sought compensation for its loss for the brutal termination of their established commercial relations (application of Article L 442-1, II of the Commercial Code) directly from the company at the head of the network.

A court of appeal rejects his claim, holding in particular that the forty-three shops were operated, at the time of the breach, by thirty-six different companies with autonomous legal personalities distinct from the network head company, that the invoices produced were issued to the addresses of the multiple branded establishments and not to the network head company, and that several of the companies operating these shops were independent concessionaires, and therefore personally liable for any brutal breach of established commercial relations committed to the prejudice of the supplier.

Ruling censured by the Court of Cassation. The fact that the member companies of the network had a legal personality distinct from that of the head company of the network did not exclude the latter from being liable for a breach of commercial relations that it had, in fact, imposed on them. The Court of Appeal should therefore have investigated whether these companies had, regardless of their status, autonomy of decision as to the choice of their suppliers and, where applicable, the continuation of their commercial relationship with them.

The approval clause in the articles of association of a simplified joint stock company (SAS) provides, in the event of refusal of approval, for the purchase of the transferring partner's shares by another partner or by the company, within a certain period, possibly extended by court decision, at the price fixed by the parties or, failing that, by an expert pursuant to Article 1843-4 of the Civil Code. After refusing to approve the proposed transfer notified by one of its partners, the SAS applied in summary proceedings for the shares to be placed in escrow and then, subsequently, for the appointment of an expert to determine the value of the shares. The transferring partner requests that the SAS be ordered to pay him the transfer price of the shares as fixed by the expert.

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A court of appeal rejects this request, ruling that the approval of the initially planned transfer must be considered as given, as the SAS did not request an extension of the time limit for repurchasing the shares after notifying its refusal of approval, as no agreement on the principle of the repurchase or on the price was reached.

Censored by the Court of Cassation: by requesting the sequestration of the shares after the refusal of approval and the appointment of an expert to set the price, the SAS had manifested its intention to acquire the shares at the price set by the appointed expert, which the transferring partner had accepted, so that the agreement had been reached on the matter and the methods of determining the price.