The Thing Sold and the Price in a French Sales Contract

Why the thing sold and the price are the heart of a French sale

Under French law a sale is a consensual contract: it is formed, and ownership passes to the buyer, the moment the parties agree on the thing and the price, even though the thing has not yet been delivered nor the price paid (Article 1583 of the Civil Code). Two building blocks therefore carry the whole contract. If either the thing or the price is missing or too uncertain, there is no sale at all. For a foreign business selling to or buying from France, this is not a formality: it decides whether you hold an enforceable contract or an empty document.

The price in a French sales contract and the thing sold each obey their own rules, but they share one logic. Both must be certain enough that a court could give effect to the bargain without having to rewrite it. The thing must be determined or at least determinable; the price must be determined or determinable. Neither may be left to the later goodwill of one party, because that would make the contract depend on a will that has not yet been expressed.

This article looks first at the thing sold, then at the price, which in practice generates far more disputes. We explain the requirement of a determinable price under Article 1591 of the Civil Code, the option of fixing the price by reference or by a third party under Article 1592, the ban on a fictitious or derisory price, and the special case of framework contracts where one party sets the price unilaterally. We close with the consequences of an indeterminate price and how to draft around them. For the wider picture, see forming a valid contract of sale.

The thing sold: existing or future, determinate or determinable

The thing sold (la chose vendue) must be determined. Where the sale concerns a specific, identified object, a corps certain, the parties simply describe it. The Civil Code pushes the seller to be precise: any obscure or ambiguous clause is construed against the seller (Article 1602 of the Civil Code), so vague order forms cut against the party who drafted them. Sensible descriptions record the state of the goods, the packaging, and any accessories that go with the item, since a French seller must deliver the thing together with its accessories.

A sale may also concern future goods that do not yet exist, such as goods still to be manufactured or a crop still to be harvested. This is permitted provided the goods are at least determinable from the contract. Where the object is a chose de genre, a generic or fungible thing sold by quantity rather than as a unique item, the parties must state how it will be individualised, for example by weighing, counting or measuring at an agreed place and time. Until that individualisation, the goods are determinable rather than determined, which also affects when ownership and risk pass.

The quality of a generic thing may be fixed by reference to a sample or a catalogue. A block sale (vente en bloc) of everything of a kind in a given place is valid even without a precise count, provided the price does not depend on a later measurement. By contrast, if weighing or measuring is needed to determine the quantity itself, the sale is not complete as a block until that operation is done. The practical lesson is to specify, in the contract, exactly what is sold and how any open element will be pinned down.

The thing must be in commerce and the seller must have power to sell

A valid sale requires more than a well-described object. The thing must be in commerce, that is, capable of being freely traded. A sale may concern things that are in commerce unless public policy or a specific statute prohibits their transfer. Some goods are simply outside private trade or are subject to authorisations and controls; a purported sale of such things is ineffective regardless of how carefully the price and description are drafted.

The seller must also have the power to sell the thing. The sale of another person's property is void under French law, and only the buyer may invoke that nullity, as protection against the risk of being evicted by the true owner. The true owner cannot rely on that nullity but may bring a claim to recover the goods, subject to the buyer's ability to oppose good-faith possession of movable property. For cross-border supply chains, this makes title and authority checks part of price and thing due diligence, not a separate afterthought.

Freedom to sell and to buy is the principle, and it includes the freedom to choose one's counterparty, subject to statutory pre-emption rights or contractual rights of first refusal that the parties have agreed. Certain sales are also regulated, for example sales to consumers, regulated sale campaigns, or sales of particular products affecting health and safety. These controls sit alongside the requirements on the thing and the price rather than replacing them. See B2B vs consumer sales for how the buyer's status changes the applicable regime.

The price must be determined or determinable under Article 1591

The price of a sale must be determined and designated by the parties (Article 1591 of the Civil Code), or at least determinable. This is the single most litigated aspect of the price in a French sales contract. A determined price is a fixed figure the parties have agreed. A determinable price is one that is not yet a number but can be worked out later from objective factors set in the contract, without the parties having to reach a fresh agreement. The distinction matters because a price that still depends on a future meeting of minds is treated as no price at all.

The test, drawn from the general law of obligations, is that the price must be determinable by reference to elements that do not depend on the will of either party alone and that require no new agreement to apply (Article 1163 of the Civil Code sets the parallel requirement for the object of any obligation). A price expressed as so much per kilo, per unit or per cubic metre, with the quantity then measured, is determinable. A price tied to a published market index or an agreed formula is determinable. A clause that says the price will be agreed later, or fixed at the seller's discretion at delivery, is not, because it leaves the essential term open.

The parties are free to set the price as they wish, subject to contrary rules, and they may make it payable in cash or by instalments. What they cannot do is leave the figure truly unsettled. Drafting a determinable price means writing down the mechanism, the reference data, and the moment the calculation is made, so that on the agreed date the price falls out automatically. If your commercial model needs flexibility, build it as a formula or an index, not as a right to name a number later. For adjustments over time, see price revision and indexation clauses.

Fixing the price by reference or by a third party (Article 1592)

Where the parties do not want to fix a number themselves, French law offers a recognised route: the price may be left to the determination of a third party they appoint (Article 1592 of the Civil Code). This third party, often called an expert or valuer, is not an arbitrator resolving a dispute but a person mandated to set the price. The parties agree in advance to be bound by the figure that person produces, which is why appointing a third party is a valid way to make the price determinable rather than uncertain.

For this mechanism to work, the contract should identify the third party or a clear method of appointing one, and define the basis on which the price is to be assessed. If the appointed person cannot or will not act, and the contract provides no fallback, the sale can fail for want of a price, so a well-drafted clause names a substitute or gives a court or a professional body the power to appoint one. The third party's valuation binds the parties in the same way an agreed figure would, absent gross error or a manifest departure from the mandate.

Alternatively, the price can be fixed by reference to an external, objective benchmark: a stock exchange quotation, a commodity index, a published tariff, or a formula linked to volumes measured on delivery. In subscription-type sales of water, gas or electricity, for instance, the thing is individualised and the price becomes due as consumption is recorded on the meter. Reference pricing and third-party valuation are the two safe answers when a fixed figure is impractical at signing. Both keep the price determinable within the meaning of Article 1591.

A real and serious price: no fictitious or derisory price

Beyond being determinable, the price must be real and serious. A price that is fictitious, or so low that it is derisory (vil prix), is not a true price, and a sale without a real price lacks one of its essential elements and can be annulled. The requirement is not that the price be fair or match market value, but that it exist as a genuine counterpart to the transfer of ownership. A token or sham figure fails that test because it shows the parties never intended a real exchange for value.

This has direct consequences for structuring. A sale at a knowingly false or negligible price may be recharacterised by a court as a disguised or indirect gift, especially where a liberal intention can be inferred from a systematic undervaluation and hidden advantages between the parties. Recharacterisation as a gift drags in the special rules on gifts, including nullity in certain insolvency and incapacity scenarios and exposure to claims by heirs or creditors. Intra-group transfers at an under-value carry the same risk, and can also attract tax reassessment.

It is important to separate two ideas that are often confused. A derisory or fictitious price destroys the sale for lack of an essential element. That is different from lésion, the rescission of a sale for a serious imbalance in value, which is exceptional in French law and does not apply to ordinary sales of goods and equipment. Undervalue alone does not let a party undo a sale of movables; only the absence of a real price does. For the detail of low-price and symbolic transactions, see undervalue and vil prix.

Unilateral price-setting in framework contracts (Article 1164)

The rule that one party may not fix the price at its own discretion is relaxed in one setting: framework contracts. Under Article 1164 of the Civil Code, in a framework agreement the parties may provide that the price will be set unilaterally by one of them, which is common in long-term supply relationships where prices in successive orders track a published tariff that the supplier updates. This is an exception to the ordinary requirement that the price not depend on one party's will, and it exists precisely because a fixed price cannot sensibly be locked in for the whole life of a multi-year relationship.

The exception comes with a safeguard against abuse. Article 1164 requires the party that sets the price to be able to justify the amount if challenged, and in case of abuse a court may award damages and, where appropriate, order termination of the contract. So the supplier's freedom to update its tariff is real but controlled: the price it charges must not be abusive, and the party fixing it should be ready to explain how the figure was reached. This turns transparency of the pricing method into a legal safeguard, not just good commercial practice.

For a foreign business entering a French distribution or supply relationship, the practical points are to confirm the arrangement truly qualifies as a framework contract, to record the objective basis for tariff updates, and to keep the evidence needed to defend or contest a given price. A comparable logic of abuse control applies more widely to significant imbalances between businesses. Where you want a moving price in a one-off sale rather than a framework, use an index or a third-party valuer instead of a discretionary right to set the figure.

Consequences of an indeterminate price and how to avoid them

If the price is neither determined nor determinable, the sale is exposed to nullity for absence of an essential element. The same fate awaits a sale with no real price. Nullity is not a technical inconvenience: it unwinds the transaction retroactively, with restitution of the thing and the price, and a French court may order those restitutions on annulment even without a specific request. A buyer who has resold or used the goods, and a seller who has spent the proceeds, both face the disruption of putting each other back in their pre-contract position.

The good news is that these outcomes are avoidable with disciplined drafting. Almost every price dispute traces back to a clause that either left the figure to be agreed later or made it depend on one party's discretion outside a framework contract. The cure is to choose, at signing, one of the recognised routes: a fixed figure, an objective formula or index, or a third-party valuation under Article 1592. Each keeps the price determinable in the sense Article 1591 demands, and each removes the argument that there was no price.

The steps below set out a practical method for placing your thing and price beyond challenge. They apply whether you sell into France or buy from a French supplier, and they pair naturally with the wider checklist in forming a valid contract of sale.

Frequently asked questions about the price in a French sales contract

Does the price have to be fixed in the contract?

No. Article 1591 of the Civil Code requires the price to be determined or determinable. A determinable price is one you can calculate later from objective elements set in the contract, such as a formula or index, without any fresh agreement between the parties. Only a price left completely open, or at one party's discretion outside a framework contract, is a problem.

Can a third party set the price?

Yes. Under Article 1592 of the Civil Code the parties may appoint a third party to fix the price, and they are bound by the figure that person produces. It is wise to name the third party or a method of appointing one, define the basis of valuation, and provide a fallback if the appointee cannot act, so the sale does not fail for want of a price.

What is a determinable price?

A determinable price is not yet a number but can be worked out later from objective factors that do not depend on the will of one party alone and need no new agreement to apply. Examples include a price per unit with the quantity measured on delivery, an index-linked price, or a valuation by a third party under Article 1592.

Can one party set the price later?

As a rule, no: a price left to one party's discretion is treated as uncertain. The exception is a framework contract, where Article 1164 of the Civil Code allows one party to set the price unilaterally. Even then the price must not be abusive, and the party fixing it must be able to justify the amount, failing which a court may award damages or order termination.

What happens if the price is uncertain?

The sale is exposed to nullity for absence of an essential element. Nullity unwinds the contract retroactively, with restitution of the thing and the price, which a French court can order even without a specific request. The way to avoid this is to make the price determined or determinable at signing.

Is a one-euro or symbolic price valid?

It is risky. The price must be real and serious; a fictitious or derisory price is treated as no price, so the sale can be annulled or recharacterised as a disguised gift, with insolvency, succession and tax consequences. A low price for a documented commercial reason is different from a sham figure.

Does undervalue let me cancel a sale of goods?

Not by itself. Rescission for lésion (imbalance in value) is exceptional in French law and does not apply to ordinary sales of goods and equipment. Only the absence of a real and serious price, not mere undervalue, undermines the sale. See our note on undervalue and vil prix for detail.

Key takeaways on the thing sold and the price

How our French lawyers help with the thing sold and the price

Petroff Avocats advises both sellers and buyers on how to define the thing and the price so that a French sale holds up. For sellers, we draft precise descriptions of the goods, determinable price clauses, index and third-party valuation mechanisms, and compliant framework pricing that survives abuse control. For buyers, we review whether the price and the goods are certain enough to enforce, whether a low or symbolic price exposes the deal to recharacterisation or tax risk, and whether the counterparty actually has the power to sell. Where a dispute has already arisen, we assess the strength of a nullity claim or defence and act to protect your position on both sides of the transaction.

This article is for general information only. It does not constitute legal advice and cannot replace a tailored analysis of your contract and circumstances. French sale-of-goods law turns on the precise wording of your agreement and the facts of each transaction. Contact our French lawyers for advice on your situation.