Dutreil pact

Which text applies?

• Art. 787 B of the French Tax Code (CGI) : Exemption from gift and inheritance tax on 75% of the value of shares in a company carrying on an operating activity, subject to collective and individual retention commitments and to a management function being held.
• Art. 790 CGI : 50% reduction in duties for outright gifts of shares meeting the conditions of article 787 B, where the donor is under 70.

On what conditions does the Dutreil pact apply?

• The company carries on an industrial, commercial, craft, agricultural or professional activity, or manages its group (active holding company).
• A collective retention commitment of at least two years, in force on the date of the transfer, covers at least 17% of the financial rights and 34% of the voting rights for an unlisted company (10% and 20% for a listed company). It may be deemed to exist where the deceased or the donor, alone or with their spouse, civil partner (PACS) or cohabiting partner, has held these thresholds for two years and carries on their main professional activity or a management function in the company.
• Each heir, donee or legatee undertakes to retain the shares received for six years from the expiry of the collective commitment.
• One of the signatories or beneficiaries carries on their main professional activity or a management function in the company during the collective commitment and for the three years following the transfer.

How long is the individual commitment since 2026?

Law no. 2026-103 of 19 February 2026 extended the individual commitment from four to six years for transfers made from 21 February 2026. Together with the two-year collective commitment, the minimum retention period is eight years.

The same law excludes from the exemption the fraction of value representing certain non-business assets (homes and residences, passenger vehicles, yachts, aircraft, works of art, jewellery, wines, racehorses, etc.), unless they are used exclusively for the business for at least three years before the transfer and until the end of the individual commitment.

Gift of full ownership or of bare ownership?

A gift of full ownership made by a donor under 70 also qualifies for the 50% reduction in duties under article 790. A gift of bare ownership remains possible under a Dutreil pact, provided that the usufructuary’s voting rights are limited by the articles of association to decisions on the allocation of profits; it does not qualify for the 50% reduction.

A breach of a commitment in principle leads to withdrawal of the exemption and to the duties becoming payable, together with late-payment interest. The company’s certificates, on the date of the transfer and then within three months of the end of the individual commitment, provide the evidence that the conditions were met.

Area of practice

• Dutreil pact →

In which cases does this concept arise?

• Passing on a family group using the Dutreil pact→
• Opening up your company’s capital while preparing succession→

Which related concepts should you know?

• Dutreil pact (sole proprietorship)
• Collective retention commitment
• Individual retention commitment
• 75% exemption
• 50% reduction in duties
• Management function
• Operating company
• Active holding company (holding animatrice)