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Dutreil Pact and transfer of a family business

The Dutreil pact allows, under certain conditions, to allow the transfer of a family business and benefit from an exemption through free transfer duties up to three-quarters of its value.


Dutreil Pact system

Transferring securities (units or shares) of companies, and individual companies who have an industrial, commercial, craft, agricultural or liberal activity, are likely to benefit from an exemption whether it’s transmission through donation or by succession and this transmission takes place through full ownership or in the context of a subdivision of property rights ( bare ownership / usufruct ). This exemption is ¾ of the value of the securities or the company.


Conditions for granting the Dutreil exemption for companies (art. 787B of the CGI):

  1. The company whose securities undergo collective commitment must exercise an industrial, commercial, artisanal, agricultural, or liberal activity or as a holding company.
  2. A collective retention commitment must be rounded off for a minimum period of two years and be in progress on the day of transmission.
  3. This collective commitment must be carried out by the deceased or the donor and his successors free of charge, with other partners or by a single person (since January 1, 2019 for a single person), for him and his successors, free of charge.
  4. Throughout its duration, this commitment covers at least 17% of financial rights and 34% of voting rights in the case of securities in unlisted companies (and at least 10% of financial rights and 20% of voting rights). voting rights in the case of securities from listed companies).
  5. During a transfer of securities, each heir , donee or legatee who wishes to benefit from the provisions of article 787B of the CGI must make an individual commitment to keep the transmitted securities for a period of at least four years from the end of the collective commitment.
  6. One of the partners who have signed the collective conservation commitment or one of the donees, heirs or legatees must practice in the company, for a duration of the collective commitment and for three years following the date of transmission, a management function (listed in 1 °of 1 of III of art 975 of the CGI).

Peculiar case: the collective commitment deemed to be granted.

The collective commitment is deemed to have been granted, when these two conditions are met:

  • Holding by the deceased (or the donor), or with his spouse, or with his partner bound together through a civil union, for at least two years, of securities representing the required limits in financial rights and voting rights.
  • Exercise in the company, by the deceased (or the donor) or his spouse or partner, for more than two years on the date of transmission:
    - of its main professional activity if the company falls under IR.
    - one of the management functions referred to in Article 975 of the CGI if the company is subject to IS.

Note: this arrangement is of major interest in the event of the manager's pre-death, even before having been able to subscribe to a collective retention commitment, while offering the possibility to his heirs as soon as the conditions are met, to benefit from a reduction of 75%.

Peculiar case: conclusion of a collective conservation commitment after death (postmortem commitment)

When the units or shares transferred by death have not gone through a collective retention commitment, and the conditions of a granted collective commitment cannot be met, one or more heirs or legatees may between them or with other partners enter into a collective agreement to retain the securities within six months of the transfer. All the conditions provided for in article 787B must be met.


Conditions for granting the Dutreil exemption for sole proprietorships (art. 787C of the CGI)

  • Activity: The company must exercise an eligible operational activity (commercial, industrial, artisanal, liberal, or agricultural).
  • The detention period: The business must be owned by the deceased or the donor for at least two years. - However, no limit is required in the event of free acquisition or creation of the transferred company.
  • Preservation commitment: Each of the heirs, legatees or donees must make an individual commitment in the declaration of inheritance or act of donation , to preserve the business for 4 years.
  • Continued operation of the business by one of the heirs or one of the donees: Moreover, one of them effectively continues to operate the business for 3 years after the transfer.

Conclusion: Through the Dutreil pact, business transfers benefit from preferential treatment in terms of both donation and inheritance. Good knowledge of the system and anticipation shall make it possible to transfer the family business under privileged conditions (article 787C of the CGI).


Creation of the "Transfer & Resume" Network

APCMA, Bpifrance, CCI Entreprendre in France, CNB, CSN and CSOEC have come together around a unique initiative which intends to promote the transfer and takeover of businesses in France by creating the " Transfer & Resume” network. 

Frequently asked questions