Property and Private International Law

We work in the areas of private international law, and also advise its private clients on international tax law.

Our services

Creation of a "société civile immobilière"

Advice in estate planning and donation, drafting of deeds necessary for transmission of assets

Advice on joint ownership litigation

Assistance in sharing community, joint ownership of property

Advice on international taxation

Advice in family property law

Drafting of custom certificates

Advice in choosing the matrimonial regime (marriage contract)

Audit to determine the applicable law to the matrimonial regime and inheritance

Assistance in the execution of foreign decisions in France

New Legislation

Bill to simplify the process of exiting joint inheritance

Proposal No. 823, filed on January 21, 2025 and adopted at first reading on March 6, 2025

Law No. 2025-415 of May 13, 2025, aimed at reducing and regulating bank charges on inheritances

Applicable to inheritances opened on or after November 13, 2025

A minimum of two partners are required to create an SCI (civil property company). The partners draft the SCI’s articles of association, either directly or through a lawyer or notary (mandatory in the case of a property contribution). The share capital can be small and consist of cash contributions (in cash) and contributions in kind. It is then divided into shares, which will be distributed among the partners according to their contributions.

The partners deposit their contributions into the bank account of the SCI being formed. This bank account is blocked until the company is officially registered with the clerk of the Commercial Court of the location of its registered office.

The articles of association signed by the partners are registered in duplicate if the articles of association include a property contribution. In other cases, the manager (or his agent) publishes a notice of incorporation of the SCI in a legal notices journal, and files the incorporation file (containing in particular a copy of the signed statutes, a copy of the manager’s appointment document, an M0 form, the manager’s declaration of non-conviction, proof of the SCI’s registered office) with the registry of the Commercial Court which will then issue the K-Bis of the SCI.

Unlike joint ownership, whereby two or more owners of the same property jointly manage it, a SCI (Société Civile de Société) is managed by one or more managers (appointed either by the articles of association, by a separate deed, or by a decision of the partners, Article 1846 of the French Civil Code).

The manager of the SCI is vested with extensive powers to carry out, in the name and on behalf of the SCI, all actions to achieve the company’s corporate purpose and within the limits set by the articles of association.

Thus, with the exception of important actions for which the manager must obtain a prior collective decision from the partners, the manager may act alone on behalf of the SCI to conclude the necessary actions to manage the property.

For important actions, such as the sale of the property owned by the SCI, a loan in the company’s name, or the rental of the property, the articles of association require the manager to obtain a collective decision from the partners. The partners may freely provide in the statutes the rules of quorum (the minimum number of partners who must be present for the general meeting to be regularly constituted and majority for decision-making.

For example, if the manager of an SCI is the majority shareholder and if the articles of association specify that the sale of the property must be authorized by an ordinary decision of the shareholders taken by a majority of votes present or represented, he or she can sell the property even if the other shareholders of the SCI oppose it.
This makes decision-making easier than in joint ownership, where the rule of unanimity among joint owners is the rule, particularly for the sale of an undivided property (Article 815-3 of the Civil Code).ted) and majority for decision-making.

A family SCI is a real estate company formed by members of the same family. Grandparents, parents, and children become partners in the SCI, which acquires and manages real estate.

A family SCI is a real estate company (SCI) formed between members of the same family. Grandparents, parents, and children become partners in the SCI, which acquires and manages real estate.

In an SCI, parents can transfer their real estate to their children by transferring shares. This transfer of SCI shares offers advantages over the direct transfer of real estate because:

• The transfer of shares in an SCI can be carried out by a private deed drawn up by the parties themselves or their counsel. Unlike the direct transfer of real estate, the involvement of a notary is never required in the transfer of shares in an SCI; this has the advantage of reducing the cost of the transaction.

• The transfer tax (“transfer duty”) is calculated on the net book value of the transferred shares, not on the value of the real estate. If the SCI has debts (for example, current loans), the amount of its debts is deducted from the value of the property, which considerably reduces the amount of tax to be paid compared to the direct transfer of the property.

The dismemberment of an SCI consists of dividing the property of an SCI into bare ownership and usufruct. The bare owner has the right to dispose of a property (by sale, donation, or bequest), while the usufructuary has the right to use the property and generate income from it.

To optimize the transfer of real estate assets, for example, an SCI formed by Mr. and Mrs. X and their children purchases a property on credit. The parents hold 90% of the shares in the capital of the SCI, the children 10%.
Shortly thereafter, Mr. and Mrs. X transfer the bare ownership of 90% of the shares to their children. The transfer tax is calculated on the value of 90% of the bare ownership of the property after deducting the amount of the SCI’s debts (outstanding loan).

The transfer tax is calculated on the value of 90% of the bare ownership of the property after deduction of the amount of debts (current loan) of the SCI, which is more advantageous than inheritance tax.

The value of the bare ownership is calculated based on the age of the usufructuary, according to the scale set out in Article 669 of the French General Tax Code:

Age of the usufructuary	Value of the usufruct	Value of the bare ownership
21 ans révolus	90 %	10 %
31 ans révolus	80 %	20 %
41 ans révolus	70 %	30 %
51 ans révolus	60 %	40 %
61 ans révolus	50 %	50 %
71 ans révolus	40 %	60 %
81 ans révolus	30 %	70 %
91 ans révolus	20 %	80 %
Plus de 91 ans révolus	10 %	90 %

It is therefore advisable to complete this transfer of shares in the SCI with reservation of usufruct as soon as possible, because the value of the bare ownership increases with the age of Mr. and Mrs. X, who will be the usufructuaries.

Upon the death of the parents, the children inherit the usufruct of the shares held by their parents without having to pay inheritance tax; indeed, the General Tax Code provides that “the reunification of the usufruct with the bare ownership does not give rise to any tax or duty when this reunification occurs upon the expiration of the period fixed for the usufruct or upon the death of the usufructuary” (Article 1133 of the French General Tax Code).

Joint ownership is the legal situation in which two or more people jointly own the same property. Each buyer owns the property up to the amount of their financial contribution at the time of purchase.

The advantage of purchasing jointly is its simplicity. It requires no formalities to set up; each buyer simply decides the proportion of their financial contribution. When cohabiting couples or civil partners want to purchase their home together, they often opt for this legal form of acquisition (50%/50%, 70%/30%, etc.).

In matters of joint ownership, to carry out any act of disposition, including the sale of the jointly owned property, decisions must be made unanimously by the joint owners, regardless of the proportion held by each.
For acts of administration, or to conclude or renew leases (other than those relating to a building used for agricultural, commercial, industrial, or craft purposes), a two-thirds majority of the joint rights may be sufficient (Article 815-3 of the Civil Code). This means that in the case of 50%/50% joint ownership, one joint owner cannot carry out any act of administration without the agreement of the other joint owner.
Furthermore, terminating the joint ownership is very complicated when the other joint owners do not agree on the sale of the jointly owned property or the terms of division. It is necessary to apply to the court for judicial partition, a procedure that can sometimes last several years and prove very costly for the parties.

A co-owner may be authorized by the courts to execute an act alone for which the consent of a co-owner would be required, if the latter’s refusal jeopardizes the common interest (Article 815-5 of the Civil Code). To do so, the other co-owner must apply to the presiding judge of the judicial court for the location of the property using the accelerated substantive procedure (Article 481-1 of the Code of Civil Procedure). The applicant must demonstrate, in support of their application for authorization to sell the undivided property alone, that the sale of the property is necessary due to the urgency and that it is in the common interest of the co-owners.

Article 4 of the Hague Convention of March 14, 1978 (for spouses married between September 1, 1992 and January 28, 2019) and Article 26 of Council Regulation (Matrimonial Property Regimes) 2016/1103 of June 24, 2016 (for spouses married after January 29, 2019) provide that, in the absence of a choice by the spouses of the law applicable to their matrimonial property regime, the law applicable to the matrimonial property regime is, in principle, the law of the State of the spouses’ first common habitual residence after the celebration of the marriage. When the spouses resided abroad for a few years after the marriage but intended to establish their habitual residence in France, French law applies to the spouses’ matrimonial property regime. The stable nature of the couple’s residence is a matter for the sole discretion of the trial judge, and the judge determines the applicable law based on several criteria, such as the existence of a real estate property.

The liquidation of a matrimonial property regime is an essential step in a divorce. It involves the division of joint property and debts acquired during the marriage according to the rules set out in the matrimonial property regime chosen by the spouses.

If the divorce is by mutual consent, the liquidation of the matrimonial property regime must be carried out during the divorce by mutual consent. The spouses must agree amicably on the liquidation and division of property; otherwise, divorce by mutual consent is not possible.
Your lawyer will advise you on the terms of liquidation of the matrimonial property regime, which will be indicated in the divorce agreement. If the spouses own real estate jointly or jointly, the division operations must be carried out by a notary. In this case, a notarized deed of partition is drawn up by the notary. This deed is attached to the divorce agreement by mutual consent. The spouses can also draw up a joint ownership agreement to maintain joint ownership for a maximum of 5 years.
In the event of disagreement on the terms of partition, one spouse must summon the other spouse before the family court judge for a divorce. In the summons, the lawyer for the plaintiff spouse specifies the proposal for a settlement of their pecuniary and property interests.

Compensation is the compensation owed, upon liquidation of the community, by a group of assets belonging to the community, or vice versa, when one group has been enriched to the detriment of the other (Article 1433 of the Civil Code).

No, unless you provide proof that the financing of this apartment exceeds your contribution to the marital expenses, which is difficult for a family home (Court of Cassation, First Civil Chamber, April 11, 2018, No. 17-17457).

You cannot obtain a refund of the amounts paid to repay the mortgage taken out when the couple purchased their home, because earnings and salaries are considered joint funds.

The law applicable to succession is the law of the country of the deceased’s “habitual residence” at the time of death (Article 21 of Regulation No. 650/2012 of July 4, 2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession).

The reserved portion is a portion of the estate reserved by law for certain protected heirs and to which gifts cannot be made.
The portion of the reserved portion is:
Half of the estate when there is one child,
2/3 of the estate when there are two children,
3/4 of the estate when there are three or more children.
(Article 913 of the Civil Code)
In the absence of children, the undivorced spouse is the compulsory heir for ¼ of the deceased’s estate.
There is no reserved portion if the deceased was unmarried and had no children. Without a will, their estate goes to their parents and siblings.

Under French law, life insurance contracts are exempt from the compulsory portion of inheritance rules (Article L 132-13 of the French Insurance Code).

It is also possible to change the matrimonial property regime to opt for the universal community property regime, with a clause granting full ownership to the surviving spouse.

After your death, your children can file an action for reduction in the French court, arguing that your “habitual residence” was in France and that the law applicable to your estate is French law (Article 4 of Regulation No. 650/2012), in order to restore the 75% reserved portion for their benefit.
To argue that New York law is applicable to your estate and that the New York court has sole jurisdiction to settle it, your wife will need to provide evidence establishing that you lived habitually in New York and not in Paris. The Court will then carry out an assessment of your life in the years preceding your death, as well as at the time of your death, in particular the length of your stays in New York, the location of all your main assets, and that of your economic interests (Court of Cassation, First Civil Chamber, May 29, 2019, no. 18-13383).

According to the case law of the Court of Cassation, the institution of the reserved portion is not in itself a matter of “French international public policy” (Court of Cassation, First Civil Chamber, September 27, 2017, No. 16-13151 and No. 16-17198). This means that a foreign law that does not recognize the reserved portion may, under certain circumstances, apply in France.

If the Court considers that your “habitual residence” was in New York, and not in France, it will decline jurisdiction, and your children will not be entitled to the reserved portion. Otherwise, the French court seized of the matter will declare itself competent to settle your estate. Under French law, your children will then not be disinherited.

Regulation No. 650/2012 provides that anyone may choose the law of the state of their nationality to govern their succession (Article 22). If you make a declaration to choose Japanese law as the applicable law for the settlement of your estate, regardless of your habitual residence at the time of death, Japanese law will apply.
You can therefore draw up a will under Japanese law to partially disinherit your children, as the compulsory portion in Japan is only 25% for children, regardless of their number, in the presence of the surviving spouse. Each of your four children will therefore benefit from 25%/4 = 6.25% of the compulsory portion, and you can bequeath up to 75% of your estate to your wife in a will.