Retraction: Key Points
Retraction is available to the landlord only. It is a motivated act that results in a refusal of renewal without an eviction indemnity. It is distinct from the right of option (unmotivated, generates indemnity) and the right of repentance (avoids indemnity by offering renewal).
Two grounds only: (1) denial of the right to the statute or renewal — any time until the final indemnity judgment, no prescription, valid even if known at the time of the original notice; (2) serious and legitimate reason — must be post-notice or newly discovered, subject to the two-year prescription from knowledge.
For retraction on serious and legitimate grounds: a formal notice under Art. L. 145-17-1 requiring the tenant to remedy the breach within one month is a mandatory prerequisite. Only if the breach persists can the retraction be made.
Post-expiry deregistration exception: once a refusal notice with an eviction indemnity offer has been served and the lease has expired, deregistration occurring after the expiry date cannot be used as a retraction ground against a tenant in the holdover period (Cass. 3e civ., 29 September 2004).
Retraction without a valid ground is void: the underlying offer is restored (Cass. 3e civ., 12 September 2019). No form is required, but bailiff service is strongly recommended. Retraction can be made through procedural filings in pending proceedings.

Overview: Three Situations Where Retraction Arises

Retraction (rétractation) is the landlord’s power to withdraw an offer previously made in a commercial lease context. It operates in three situations: retraction of a renewal offer contained in a congé with renewal offer; retraction of an eviction indemnity offer contained in a congé with refusal and indemnity offer; and retraction of a tacit or express acceptance of the principle of renewal following the tenant’s renewal request. In all three cases, the same two grounds apply: denial of the right to the statute, and serious and legitimate reasons.

How Retraction Differs from the Right of Option and Right of Repentance

Mechanism Who can use it Grounds required? Result
Retraction (rétractation) Landlord only Yes — denial of statute conditions or serious/legitimate reason Refusal of renewal without eviction indemnity
Right of option (droit d’option) Landlord or tenant No — entirely unmotivated Landlord: refusal with indemnity; Tenant: renounces renewal
Right of repentance (droit de repentir) Landlord only No — entirely unmotivated Withdrawal of refusal; renewal offered; indemnity avoided

A landlord who wants to withdraw a prior offer without paying an eviction indemnity and without offering renewal must use retraction — and must have a valid ground. Without a valid ground, the attempted retraction is void (Cass. 3e civ., 12 September 2019, n° 18-18.590). The right of option, by contrast, requires no ground but will trigger an indemnity if exercised by the landlord.

The Two Grounds for Retraction

Ground 1: Denial of the Right to the Statute or Renewal

The landlord may retract if the tenant does not or no longer satisfies the conditions for the commercial lease statute under Art. L. 145-1 (registration at RCS or RNE, genuine commercial use, exploitation of a fonds de commerce) or the conditions for the renewal right under Art. L. 145-8 (three years of personal exploitation before lease expiry). In practice, the most common ground is a registration lapse or registration at the wrong address or for the wrong activity.

This ground is the stronger of the two: retraction can be made even if the landlord knew of the ground at the time of the original notice (Cass. 3e civ., 23 February 1994). It can be raised throughout the proceedings until a final judgment fixes the eviction indemnity (Cass. 3e civ., 7 September 2017; Cass. 3e civ., 20 April 2023). The action on this ground is not subject to the two-year prescription of Art. L. 145-60.

An important exception applies during the holdover period: where the landlord has already served a refusal notice with an eviction indemnity offer, deregistration occurring after the lease expiry date can no longer be used as a retraction ground (Cass. 3e civ., 29 September 2004). This reversed earlier case law that had allowed retraction on post-expiry deregistration.

Ground 2: Serious and Legitimate Reason

The landlord may also retract where a serious and legitimate reason has arisen or been revealed after the notice was served. A pre-existing breach that was known at the time of the notice cannot support retraction on this ground (Cass. 3e civ., 7 July 2004). This is the reverse of the denial ground, which allows retraction even on known pre-existing facts.

For retraction on serious and legitimate grounds (whether from a renewal offer or an eviction indemnity offer): the landlord must first serve a formal notice under Art. L. 145-17-1 requiring the tenant to remedy the breach within one month. Only after the breach persists can the retraction be made. This ground is subject to the two-year prescription of Art. L. 145-60, running from the date the landlord became aware of the breach (Cass. 3e civ., 9 November 2017).

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Ground 1 vs Ground 2: The Key Differences

Denial ground: no prescription; known pre-existing facts allowed; no prior formal notice required; raised at any point until the final indemnity judgment. Serious and legitimate ground: two-year prescription from knowledge; must be post-notice or newly discovered; prior Art. L. 145-17-1 one-month formal notice is a mandatory prerequisite. Mixing up these two regimes is a common drafting error — always identify which ground is being invoked and apply the correct procedure.

Form and Timing

Retraction is not subject to the formal requirements of Art. L. 145-9 (bailiff service, six-month notice, etc.). No statutory-form notice is required. It can be made by any means that clearly communicates the landlord’s intention — though bailiff service is strongly recommended for evidence. In pending proceedings, retraction can be expressed through procedural filings.

  • Retraction of a renewal offer: at any time before the lease is definitively renewed — which occurs at the latest one month after service of the final rent-fixing judgment if neither party has exercised the right of option by then. It can be made before, during, or after rent-fixing proceedings, and even at the appeal stage.
  • Retraction of an eviction indemnity offer: at any time while the right to the indemnity has not been definitively established. The outer limit is the expiry of the fifteen-day right of repentance window following the final judgment — after which the landlord is committed to paying the indemnity.

Retraction Following the Tenant’s Renewal Request

Where the landlord accepted (expressly or by silence) the principle of renewal in response to the tenant’s renewal request, they can later retract that acceptance on exactly the same grounds: denial of statute conditions or serious and legitimate reason. The rules are identical. The Court of Cassation confirmed in 2015 that a landlord who was aware of the tenant’s lack of RCS registration throughout the proceedings was not treated as having waived the right of retraction by failing to invoke it earlier (Cass. 3e civ., 19 November 2015, n° 14-22.000).

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Warning — Retraction Without a Valid Ground Is Void

A landlord who attempts to retract without being able to establish a valid ground — either a denial condition or a serious and legitimate reason — will have that retraction declared null. The consequences depend on the type of notice: a void retraction from a renewal offer restores the renewal offer; a void retraction from an eviction indemnity offer means the indemnity obligation remains. The ground must be real, documented, and provable before any retraction is attempted (Cass. 3e civ., 12 September 2019, n° 18-18.590).

Practical Checklist: Assessing a Retraction
Step 1 — Identify the ground precisely: is this a denial of statute/renewal conditions (Art. L. 145-1 or Art. L. 145-8 failure), or a serious and legitimate reason? The applicable procedure, prescription, and timing rules are entirely different for each ground. Do not mix them.
Step 2 — For serious/legitimate grounds: serve the Art. L. 145-17-1 formal notice first: the one-month prior formal notice is a mandatory prerequisite, not an optional step. Without it, the retraction on this ground will fail regardless of how serious the breach is.
Step 3 — Check the holdover exception for denial grounds: if the lease has already expired, a refusal notice with indemnity offer has been served, and the tenant is in the holdover period, post-expiry deregistration cannot be invoked as a ground for retraction. Pre-expiry registration defects remain available.
Step 4 — Assess the timing window: for a renewal offer retraction, the window is open until the lease is definitively renewed; for an indemnity offer retraction, the window is open until the right to the indemnity is definitively established. Retraction at appeal stage is possible for both, subject to the ground being raised in the proceedings.
Step 5 — Document and serve correctly: the ground must be real and provable. Serve by commissaire de justice for evidence. If proceedings are underway, the retraction can be expressed in procedural filings, but standalone service preserves a clear evidence trail.
Considering Retraction — or Challenging One?

Whether you are a landlord assessing whether you have valid grounds to retract an earlier offer, or a tenant whose renewal offer or eviction indemnity offer has been retracted without adequate grounds, we advise on the legal basis, the procedure, and the consequences.

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Legal Notice. This article is for general information and educational purposes only. It does not constitute legal advice. Laws and regulations may have changed since publication. Always seek qualified French legal advice on retraction in a French commercial lease.