How does the eviction indemnity for a commercial lease work?

When a landlord refuses to renew a commercial lease, the tenant is entitled, except in certain cases, to an eviction indemnity. This financial compensation aims to remedy the harm suffered by the trader who loses their business. Understanding the mechanism of this indemnity is essential for any tenant entrepreneur facing a refusal of renewal.

What is the eviction indemnity and when is it due?

Eviction compensation is a sum paid by the landlord to the evicted tenant when the owner refuses to renew the commercial lease without serious and legitimate grounds. It is governed by Articles L145-14 et seq. of the Commercial Code. The right to this compensation arises when the tenant operates his business on the leased premises and the landlord notifies his refusal to renew.

Cases where the indemnity is not due

There are exceptions where the lessor can refuse renewal without paying compensation: repossession for habitation (under conditions), construction or reconstruction, or serious fault of the tenant. In these cases, the tenant must leave the premises without compensation.

How is the eviction indemnity calculated?

The calculation of the eviction indemnity is complex and varies depending on each situation. It must cover the entirety of the prejudice suffered by the tenant. Several components come into play:

The market value of the business

This concerns the loss of the business, calculated based on its turnover, profitability, clientele, and location. A chartered accountant or statutory auditor is often appointed to assess this value.

Moving and relocation costs

The compensation also includes moving costs, search costs for new premises, fitting-out works, double rent during the transition, and temporary loss of clientele.

Commercial disturbance

An amount is added to compensate for the disruption of business activity, loss of turnover during the transition period, and advertising costs to inform customers of the new place of business.

What is the procedure to obtain the eviction indemnity?

The procedure is strictly regulated by law. The lessor must notify his refusal to renew by extrajudicial act (bailiff) at least six months before the expiry of the lease. Failing this, the lease is tacitly renewed.

The amicable phase

Once the refusal is notified, the parties generally try to negotiate the amount of compensation amicably. This phase can last several months and often requires the intervention of experts to assess the damage.

The judicial phase

If no agreement is reached, the tenant can refer the matter to the judicial court to set the compensation. The judge then appoints a judicial expert who will assess the damage. This procedure can take one to two years.

Who pays the eviction indemnity?

It is the lessor who pays the compensation to the evicted tenant. However, in some cases, the new tenant may be jointly liable for payment if the lessor has re-let the premises before paying the compensation. The owner may also ask the tenant to leave the premises before payment, but only if the compensation has been deposited with the Caisse des Dépôts.

What is the deadline to receive the compensation?

The tenant may remain on the premises until full payment of the compensation. This right to remain on the premises is a real property right. In practice, the time frame varies from a few months to several years depending on the complexity of the case and the amicable or judicial phase. The landlord may request a provisional payment from the judge to expedite the tenant's departure.

What to do in case of disagreement on the amount?

In case of disagreement, the tenant must absolutely refer the matter to the judicial court within two years from the notification of the refusal of renewal. After this period, they lose their right to compensation. It is therefore crucial to act quickly and be assisted by a avocat expert in commercial leases.

Conclusion

The eviction indemnity is an essential protective mechanism for the tenant trader, but its calculation and procedure are complex. Each case is unique and requires a thorough analysis of the legal and financial situation. To secure your rights and maximize your chances of obtaining a fair indemnity, do not hesitate to consult a lawyer specialized in real estate law. Maître Cécile Zakine accompanies you through all stages of this procedure, from amicable negotiation to

📅 Mis à jour le 08/08/2026 — Par Maître Cécile Zakine, avocate et Docteur en Droit à Antibes. ☎ 06 21 69 91 77.