Reform Of French Contract Law – Ratification Law Published On April 21, 2018: Main Changes Impacting Business Law

Author:Ms Anaëlle Idjeri
Profession:Soulier Avocats

While it did not drastically alter the changes brought about by Ordinance n° 2016-131 of February 10, 2016, the Ratification Law n° 2018-287 of April 20, 2018 did modify some aspects of French contract law and introduced a distinction between substantive amendments that will become effective as from the entry into force of the Ratification Law, i.e. October 18, 2018, and so-called "interpretative" amendments that will apply retroactively to contracts entered into on and after October 1, 2016.

This article provides a non-exhaustive overview of the provisions of the Ratification Law which have a practical implication on business law, in particular at the formation of the contract and throughout its performance.

For a comparative overview of all the provisions of the French Civil Code impacted by the Ratification Law n° 2018-287 (the "Ratification Law"), we invite you to consult the article entitled " Reform of French contract law - Publication of the Ratification Law on April 21, 2018: General Presentation".

  1. Application over time

    Pursuant to Article 16 I §1 and §2 of the Ratification Law n° 2018-287, "this Law will enter into force on October 1, 2018"; it shall apply to "legal acts entered into or drawn up as from its entry into force".

    On the other hand, it must be noted that some provisions of the Law "are interpretative in character" and will consequently be effective retroactively. These provisions will apply to legal acts entered into as from October 1, 2016, date of entry into force of the February 10, 2016 Ordinance.

  2. Provisions applicable at contract formation

    Redefining standard-form contracts and the concept of significant imbalance The February 10, 2016 Ordinance introduced into the French Civil Code the concept of standard-form contract as "one [contract] whose general terms and conditions, excluded from negotiations, are determined in advance by one of the parties". New Article 1110 §2 of the French Civil Code, as modified by the Ratification Law, now defines the standard-form contract as "one [contract] that contains a set of non-negotiable clauses determined in advance by one of the parties". This provision shall apply to contracts entered into as from October 1, 2018.

    This change, and in particular the deletion of any reference to "general terms and conditions" obviously entails an extension of the concept and scope of application of standard-form contracts. These contracts are no longer limited only to standard...

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