French Court of Cassation rules on commercial rent increases

The French Court of Cassation has issued a significant ruling regarding the legality of automatic rent increases in commercial leases. In a decision dated September 3, 2026, the Court overturned a previous ruling by the Lyon Court of Appeal concerning a lease that stipulated a fixed annual rent increase of 1.5% starting from the third year.

The dispute centered on whether such a clause constituted a valid progressive rent structure or an illegal disguised rent revision. While parties are free to agree on initial rent levels and progressive rent through specific tiers, the Court found that the clause in question failed to meet legal criteria. Specifically, the clause did not establish fixed rent levels for specific dates nor did it include a predetermined ceiling, instead allowing for automatic increases that could continue indefinitely without being tied to an index.