L 145-5-1
Article L 145-5-1 of the Code de commerce — introduced by the 2014 reform to codify the convention d'occupation précaire and formally confirm its permanent exclusion from the commercial lease statute, regardless of duration.
No max duration
The defining advantage over the bail dérogatoire: the convention d'occupation précaire has no maximum duration and holdover does not trigger the commercial lease statute — as long as the external circumstances legitimising precarity persist.
External only
The circumstances legitimising precarity must be independent of the parties' will alone — they cannot be manufactured by agreement. The desire to avoid the statute, the wish to retire, and the existence of a crédit-bail are not external circumstances.

Origins and Purpose: A Contract Born of Exceptional Circumstances

The convention d'occupation précaire was not invented by the legislature. It is a creation of practice, developed originally in response to the exceptional circumstances of wartime occupation. Rather than leave their properties vacant during their absence, owners preferred to grant provisional enjoyment to an occupant, on terms that required restitution on their return. The occupant had no settled right, no expectation of permanence — only a fragile, revocable permission tied to circumstances beyond either party's control.

After the war, the convention survived and flourished as a reaction against the mandatory provisions of the commercial lease statute introduced in 1953. Its growth was significant enough that the legislature eventually responded by creating the bail dérogatoire as a regulated, time-limited alternative. But the precarious occupation agreement did not disappear: it offers something the bail dérogatoire cannot — it is not subject to any maximum duration. The legal framework is now codified at Article L 145-5-1 of the Code de commerce, introduced by the 2014 reform, which formally confirms its exclusion from the commercial lease statute and restates the jurisprudential definition.

The Legal Definition: Two Cumulative Elements

Under Article L 145-5-1 of the Code de commerce, the convention d'occupation précaire is characterised, whatever its duration, by the fact that the occupation of the premises is authorised only by reason of circumstances independent of the sole will of the parties. This codified definition reproduces exactly the definition previously established by the Cour de cassation (Cass. 3e Civ. 9-11-2004 n° 1170 ; Cass. 3e Civ. 29-4-2009 n° 08-13.308). Both elements must be present at the moment the convention is concluded — neither can be manufactured after the fact.

Element 1: Fragility of the Occupant's Right
Both parties must genuinely intend and agree that the occupation is precarious and revocable. This intention is not established by the label on the contract alone. Courts look at duration provisions, termination rights, the level of the redevance, charges allocation, and all surrounding circumstances as a bundle of indices.
Element 2: External Circumstances Legitimising Precarity
Objective circumstances, independent of either party's will alone, must exist at the date of signing and must explain why the occupation is provisional. These cannot be manufactured by agreement between the parties. The desire to avoid the commercial lease statute is not, by itself, a legitimate circumstance.
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The Label Is Not Enough

A contract entitled "convention d'occupation précaire" is not necessarily one. The courts look at substance, not form. A landlord who inserts the precarious occupation label in a contract without any genuine external circumstance justifying precarity will find the arrangement requalified as a commercial lease (Cass. 3e Civ. 12-10-1988 n° 87-12.147). Conversely, a contract that does not use the label but satisfies both substantive conditions will be treated as a precarious occupation agreement. Qualification is a matter of substance alone.

How It Differs from the Bail Dérogatoire and Other Instruments

The bail dérogatoire under Article L 145-5 of the Code de commerce is a genuine lease that derogates from the commercial lease statute by reason of its limited duration only. It is capped at three years, and if the tenant remains in possession for more than one month after expiry, a full statutory commercial lease arises automatically. The convention d'occupation précaire, by contrast, is not a lease at all. It is not subject to any maximum duration — it can last as long as the external circumstances that justify it persist. And crucially, the holdover rule does not apply to it: if the occupant remains after the agreed term and the precarity motive still subsists, the commercial lease statute does not spring into life (Cass. 3e Civ. 2-4-2003 n° 490 ; CA Paris 22-6-2005 n° 03-3789).

The convention d'occupation précaire must also be distinguished from the prêt à usage: both share a temporary character, but the precarious occupation agreement is an onerous arrangement — a redevance, even a modest one, is part of its essence. A convention that is entirely gratuitous will be characterised as a loan for use rather than a precarious occupation agreement.

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The Critical Practical Distinction: Duration and Holdover

A bail dérogatoire is capped at three years. If the tenant holds over for more than one month, a statutory commercial lease arises automatically. A convention d'occupation précaire has no maximum duration and holdover does not trigger the statute, as long as the precarity motive persists. Courts have therefore been strict in requiring a genuine external circumstance: three conventions successively qualified as precarious occupation agreements, each shorter than two years, were requalified as baux dérogatoires because they mentioned no exceptional circumstances marking their expiry (Cass. 3e Civ. 19-11-2003 n° 1262). Similarly, a two-year arrangement without any precarity motive was necessarily a bail dérogatoire, not a precarious occupation agreement (Cass. 3e Civ. 15-10-2014 n° 13-20.085).

The First Element: Fragility of the Occupant's Right

The precarity of the occupant's right must have been intended and agreed by both parties (Cass. com. 28-2-1966 n° 62-11.924). This shared intention is never established by the contractual label alone (Cass. 3e Civ. 12-10-1988 n° 87-12.117). The courts examine a bundle of indices, none of which is determinative in isolation.

Duration

Duration is not an important index of precarity. Precarity resides not in the shortness of the arrangement but in its fragility — its susceptibility to termination at any moment by virtue of external circumstances. Courts have upheld the precarious character of conventions lasting five years (Cass. 3e Civ. 16-2-2000 n° 281), and even of conventions that had run for twenty years while retaining their stated precarious and revocable character (Cass. 3e Civ. 28-10-1987 n° 84-10.296 ; Cass. 3e Civ. 14-11-2019 n° 18-21.297). What matters is the uncertainty over the duration — the fact that its end depends on the occurrence of an event whose date is unknown or uncertain altogether.

Termination Rights

The ability to end the occupation at any time, without having to comply with a notice period, is a strong indicator of precarity (Cass. com. 10-4-1967 n° 63-11.578). A short notice period — three or six months — does not destroy the precarious character (Cass. 3e Civ. 26-11-1970 n° 69-10.246). Courts have upheld bilateral termination rights as consistent with precarity (Cass. 3e Civ. 5-4-2011 n° 10-30.158).

The Level of the Redevance

The modesty of the occupation fee is a classically recognised indicator of precarity (Cass. com. 28-2-1966 n° 62-11.924 ; Cass. 3e Civ. 25-4-1990 n° 88-16.643). A redevance set at half the market rental value points toward precarity. However, a high level of consideration does not automatically destroy the precarious character where the other conditions are clearly met (CA Paris 4-4-2018 n° 17/14027). The absence of a charge allocation obligation on the occupant and the absence of a maintenance obligation are further indices in favour of precarity.

The Second Element: External Circumstances Legitimising Precarity

External circumstances — independent of the parties' will alone — must explain and justify why the occupation can only be provisional. These circumstances must exist at the moment the convention is signed (Cass. 3e Civ. 29-4-2009 n° 08-13.308 ; Cass. 3e Civ. 31-1-2012 n° 10-28.591 ; Cass. 3e Civ. 7-7-2015 n° 14-11.644). A circumstance that arises later, or that depends entirely on the parties' own choices and decisions, does not qualify.

The courts have been particularly demanding on this point. The mere wish of both parties to avoid the commercial lease statute is not an external circumstance. The tenant's desire to retire and find a buyer is not an external circumstance — it depends entirely on the tenant's own decision (Cass. 3e Civ. 7-7-2015, précité ; CA Paris 1-12-2021 n° 20/04742). The existence of a crédit-bail is not an external circumstance because its resolution depends on the crédit-preneur's own performance (CA Lyon 23-9-2021 n° 18/08205). An anticipated purchase of the premises where no binding agreement has been concluded is not a sufficiently objective circumstance (CA Bordeaux 19-2-2024 n° 22/00234).

Circumstances Recognised by Courts as Legitimising Precarity
  • Pending expropriation proceedings, even where administrative delays have considerably extended the process (Cass. 3e Civ. 12-1-1977 n° 75-13.632 ; Cass. 3e Civ. 6-11-1991 n° 1588)
  • A communal plan for the creation of an industrial zone on the occupied land (Cass. 3e Civ. 16-2-2000 n° 281)
  • Occupation of land in a protected forest zone earmarked for the construction of a dam (Cass. 3e Civ. 28-10-1987 n° 84-10.296)
  • Parcels acquired in anticipation of the medium-term extension of a nearby quarry (Cass. 3e Civ. 20-5-2014 n° 13-11.065)
  • Occupation pending reconstruction of the occupant's premises destroyed by fire (Cass. 3e Civ. 2-4-2003 n° 490)
  • Temporary premises made available by a company in liquidation judiciaire, pending construction of a new facility, conditional on mortgagee authorisation (Cass. 3e Civ. 29-4-2009 n° 08-13.308)
  • Construction of a planned superstore suspended by legislation prohibiting new stores of the relevant category (CA Paris 22-12-1973)
  • Occupation pending the outcome of litigation over the owner's title to the property (CA Paris 13-1-1972)
  • Trial occupation for a limited period to test a new fast-food activity ancillary to the tenant's existing bar business in an adjacent premises (Cass. 3e Civ. 9-2-2017 n° 15-18.251)
  • Occupation pending sale of the premises, where the pending sale constitutes a genuine external constraint — such as a conditional promesse synallagmatique de vente subject to obtaining financing (Cass. 3e Civ. 10-7-1996 n° 1536 ; Cass. 3e Civ. 31-1-2012 n° 10-28.591)
  • An urban rehabilitation project involving demolition of the building, referred to from the outset of the relationship (Cass. 3e Civ. 14-11-2019 n° 18-21.297)
  • Premises made available on market or fair days only, or during specific hours only, reflecting the discontinuous and temporary character of the occupation (Cass. 3e Civ. 14-11-1973 n° 72-13.043 ; Cass. 3e Civ. 13-2-2002 n° 234)
  • Occupation of a defined emplacement within a department store or hypermarket, accessible only during the store's opening hours (Cass. 3e Civ. 9-2-1994 n° 91-16.864)

The Legal Regime: Rights and Obligations of the Parties

The convention d'occupation précaire is a contrat sui generis — an unnamed contract that fits no established legal category. It is not subject to any formalism; it is subject neither to the rules of common law leasing nor to the commercial lease statute. No particular form is required, though a written instrument is strongly advisable.

Exclusion of Landlord Obligations

The owner is not required to act as a landlord. The obligation of delivery under Article 1719 of the Code civil does not apply (Cass. 3e Civ. 11-1-2024 n° 22-16.974). Rules concerning works made necessary by the dilapidation of the premises are not binding on the owner (Cass. 3e Civ. 12-6-1985 n° 84-12.214). The occupant cannot obtain a court order requiring the owner to carry out works, nor claim a reduction of the occupation fee on grounds of disturbance of enjoyment. The guarantee against eviction does not apply to a precarious occupant (Cass. 3e Civ. 22-7-1992 n° 1258). The convention is also exempt from the requirement of land registration even if it lasts more than twelve years (Cass. 3e Civ. 19-11-2014 n° 13-20.089).

Fire Liability and End of Occupation

Despite the exclusion of ordinary landlord-tenant rules, the Cour de cassation has held that an occupant who occupies premises under a precarious convention for consideration is subject to the presumption of liability in case of fire under Article 1733 of the Code civil (Cass. 3e Civ. 28-10-1975 n° 74-11.752). This rule applies when the convention was granted by the owner directly; it does not apply when the precarious convention was granted by a tenant (Cass. 3e Civ. 7-7-2016 n° 15-12370).

When the precarious occupation agreement expires or is terminated, the occupant must leave. The occupant has no right of renewal and no entitlement to an eviction indemnity (Cass. 3e Civ. 6-11-1991 n° 1588). The renewal of the agreement or the conclusion of a new precarious occupation convention between the same parties does not attract the commercial lease statute, as long as the conditions of precarity remain fulfilled (Cass. 3e Civ. 21-3-1990 n° 88-19.365). If the occupant holds over beyond the agreed term without concluding a new convention, and the precarity motive persists, the statute does not apply (Cass. 3e Civ. 2-4-2003 n° 490).

The Fraud Exception: When a Precarious Occupation Agreement Becomes a Disguised Commercial Lease

The immunity from the commercial lease statute is not absolute. A precarious occupation agreement constitutes a disguised commercial lease when it was concluded with the sole purpose of defeating the mandatory provisions of the statute (Cass. 3e Civ. 25-5-1977 n° 76-10.226). In that case, the courts requalify the convention as a commercial lease and give it full statutory effect.

To identify fraud, courts examine the parties' intentions at the time of conclusion and the objective circumstances said to justify precarity. Where a landlord imposes precautionary language on an occupant with no genuine external circumstance and no real fragility of right, the convention will be unmasked as a disguised lease. A boutique with a street-facing shopfront, occupied for four years with regular payment of rent at market value, where the landlord was aware of the commercial activity, has been requalified as a commercial lease despite bearing the precarious occupation label (Cass. com. 15-12-1966 n° 64-11.760). Once requalified, the landlord loses all provisions incompatible with the statute — including any clause restricting the tenant's right to assign the lease (Cass. 3e Civ. 1-4-2009 n° 07-21.833).

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Drafting to Avoid Requalification

To minimise requalification risk, the parties should explicitly set out in the preamble of the convention the specific external circumstances that justify the precarious character of the occupation. The reason for precarity should be stated with precision: a pending expropriation, a suspended construction project, a conditional sale agreement, an urban rehabilitation programme. The more concretely the external circumstance is identified and documented, the less room there is for a court to find that precarity was invented as a device to avoid the statute. Courts are not deceived by formulaic references to "exceptional circumstances" with no substantive content.

Model Preamble for a Convention d'Occupation Précaire Les parties se sont rapprochées en vue de conclure une convention d'occupation tenant compte des circonstances particulières relatées ci-après légitimant le caractère précaire des droits de l'occupant voulu par les soussignés. En effet, la situation de l'immeuble dans lequel sont situés les locaux, objet de la présente convention, est frappée de précarité, ledit immeuble devant faire l'objet d'une [démolition / rénovation / expropriation, etc.] d'ici le [date ou événement déterminant]. En conséquence, les parties sont convenues de conclure une convention d'occupation précaire non soumise aux dispositions du Code de commerce.
Key Points: Precarious Occupation Agreements vs. Commercial Leases in France
The convention d'occupation précaire is codified at Art. L 145-5-1 C. com. and is permanently outside the commercial lease statute — regardless of duration, regardless of holdover, as long as the external circumstances legitimising precarity persist.
Two elements are cumulative: (1) fragility of the occupant's right — genuine shared intent for precarity; and (2) external circumstances independent of the parties' will alone that legitimise and explain that precarity. Both must exist at the date the convention is signed.
The contractual label is irrelevant: a contract titled "convention d'occupation précaire" without genuine external circumstances will be requalified. Conversely, a contract without the label but meeting both conditions is a valid precarious occupation agreement. Qualification is a matter of substance alone.
Short duration is not evidence of precarity; conventions lasting five, ten, or twenty years have been upheld provided the precarity motive subsisted. A modest redevance is a classic indicator of precarity, though a high rent does not automatically destroy the character where other conditions are clearly met.
The desire to avoid the statute, the wish to retire and sell the business, and the existence of a crédit-bail are not external circumstances legitimising precarity. Valid circumstances include: pending expropriation; urban rehabilitation involving demolition; construction suspended by legislation; occupation pending reconstruction after fire; and market/fair-day emplacements.
The owner is not bound by landlord obligations: no duty of delivery, no obligation to carry out works, no guarantee against eviction. The convention is also exempt from land registration even if it lasts more than twelve years. The occupant bears fire liability under Art. 1733 C. civ. if the convention was granted by the owner directly.
At expiry: no right of renewal, no eviction indemnity. Renewal or holdover where the precarity motive persists does not trigger the statute. This is the defining advantage over the bail dérogatoire, where holdover for more than one month automatically creates a full statutory commercial lease.
A convention concluded solely to defeat the statute is a disguised commercial lease — requalification strips the landlord of all incompatible contractual protections. The preamble of the convention should describe the external circumstances with precision; formulaic language without substantive content does not protect against requalification.
Structuring a Precarious Occupation Agreement in France?

Whether you are a landlord seeking flexibility without statutory lock-in, or a business assessing the terms of an occupation offered to it, the convention d'occupation précaire requires careful structuring to be legally secure and to withstand requalification risk.

Speak with a French Lawyer

This article is for general information and educational purposes only. It does not constitute legal advice. The legal analysis reflects the provisions of the Code de commerce and the case law cited. French commercial lease law is a complex and evolving area. Always seek qualified legal advice for your specific situation before making any decision with legal consequences.