Legalese

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When  looking for a property in France (like any property search elsewhere in the world), the estate agent is often the first person to be contacted. Whether you have seen an advertisement in an estate agency window or browsing the web, l’agent immobilier will be, most of the time, your first contact in the purchasing process.

All estate agencies in France must be registered with the French trade authorities. The activity of estate agent is regulated by French law (Loi Hoguet) which applies as soon as an individual or any corporate entity carry out or assist in an operation, on a regular basis, relating to someone else’s property. In that respect, all estate agents must have a carte professionnelle that allows them to carry out this activity. All Allez-Français agents hold a carte via JeSuisAgentImmobilier, a national  agency with offices in Paris & Bordeaux.

Purchasing property in France is a potential minefield. It is important to understand the documents required between you, whether a vendor or a buyer, and the estate agent. This article explains the documents which should help you have a clearer idea of what to expect.

Agency agreement (Mandat)

Before any negotiation or commitment, a mandat between either a vendor looking to sell a property or a buyer looking for a property must be signed with the agent. The mandat is the agreement that determines the rules between the vendor/buyer and the estate agent. It must comply with the strict legal requirements of the loi Hoguet and any non compliance or breach of this mandat would render it void which would prevent the agent from being entitled to a commission.

The mandat and the main sale agreement (often called compromise de vente) are two different agreements and as a result breach of the mandat does not render the compromis void. Therefore, the compromis signed between a vendor and a buyer is still enforceable.

Exclusivity

The mandat may include an exclusivity clause which must clearly appear in the agreement. Exclusivity forbids the client to deal with another professional to sell the property or to sell it himself, failing which compensation (usually equal to the amount of the commission) would be payable to the agent. If the agent agrees to it, the exclusivity clause can be modified to allow the sale by the vendor himself but not through another professional, (this is called a semi-exclusive mandat).

Bon de visite

A potential buyer who has visited a property may have to sign a bon de visite to acknowledge their visit. Although a bon de visite is useful for the agent to prove his involvement, it does not replace a mandat and as such, on its own, cannot entitle the agent to any payment.

Estate agent’s liability

The agent also has a duty to check the characteristics of the sale (property and parties), to inform and to advise, failing which his liability may be called into question. This could be the case where an agent does not reveal, misrepresents or conceals facts that would influence the decision to purchase.

Commission

The level of commission is not subject to any limitation and there is therefore no 'fixed rate' which means that commission can always be negotiated with the agent at the outset. In that regard, if the price includes the commission, it must be clearly stated in the compromis de vente.

When completion does not take place, an agent cannot claim any commission. A clause mentioning that commission is due even if the completion deed is not signed is considered null and void. However, the agent may be able to claim compensation. It is advisable in practice to agree a compensation amount that would be payable by the party who prevented the completion or refused to complete. This reduces the chance of a dispute and possible litigation procedure.