French civil partnership (pacs)
The PACS, contrary to the Civil Partnership Act 2004, is a contract made by two adults to the same or opposite sex to organise their lives. Like the Civil Partnership Act 2004 the PACS sets out the rights and duties of partners and requires formalities regarding the registration and termination.
The PACS, contrary to the Civil Partnership Act 2004, is a contract made by two adults to the same or opposite sex to organise their lives. Like the
Civil Partnership Act 2004 the PACS sets out the rights and duties of partners and requires formalities regarding the registration and termination.
The Regulation 2016/1104 of 24 June 2016 implementing enhanced cooperation in the area of jurisdiction, applicable law and the recognition and enforcement of decisions in matters of property consequences of registered partnerships came into force on 29 January 2019. At the moment only 19 member states have signed the regulations: Belgium, Bulgaria, Germany, Finland, France, Greece, Italy, Croatia, Luxembourg, Malta, Netherlands, Austria, Portugal, Sweden, Slovenia, Spain,Czech Republic,Cyprus and Estonia.
The aim of the regulation was to uniform one single law that will apply to all property regardless of where it is located. It is therefore the unity of the applicable law that has been preferred by the drafters.
Article 22-a provides that partners may choose the law of the State in which at least one of the two partners or future partners has his habitual residence at the time the agreement is concluded.
Article 22 (b) also contemplates the choice of the law of a State of which one of the partners or future partners is a national at the time the agreement is concluded.
Finally, article 22-c provides that future partners may choose the law of the state under whose law the registered partnership was created.
In the absence of a choice of applicable law, Article 26 of the Regulation provides that the law applicable to the property consequences of the registered partnership is the law of the State according to the law of which the registered partnership was created.
For the case that two partners decide to choose French law as the law applicable to your partnership, I have set out below the principles rules in France.
Conditions to conclude a PACS
The PACS is only permitted for unmarried individuals who have not already contracted a PACS with a third party. It will be prohibited within degrees of relationship. For instance, adopted children, siblings, stepparents with children cannot contract a PACS. As the PACS is a contract the rules regarding the consent will also be applicable.
Regarding the form of the PACS, the partners will provide the Mairie with two original of a written contract. No particular form is required and the partners could prepare the contract themselves or request the assistance of a Lawyer (Solicitor or Notaire) to guide them.
Effects of the PACS
The PACS will have an effect and consequences depending on your residency. Some of the rules will only apply if you are French residents, others such as French real assets and tax consequences concern both UK and French residents. For those who will elect residency in France the PACS resulting from the Law dated 23rd June 2006 reinforce the concept of assistance during the PACS. The PACS copies the rules applicable for married
couple under the legal French matrimonial regime. It will fix the modalities of the mutual assistance that are compulsory during the PACS.
The mutual assistance will consist for the partners to financially assist each other in day-to-day life and be responsible for any debt contracted with a third party to the exception of charges related to the common residency. The main amendment with the Law concerns the identification and ownership of the assets during the PACS. Originally all assets were deemed to be jointly owned unless a declaration was made by the partner in the deed of sale. Now French law introduced two different regimes which can be chosen by the partners in their convention:
Legal regime: the legal regime of PACS will complies with the separation of ownership. Without entering into details any asset that you purchase on your own will be personal and cannot be part of the PACS. It is obviously wise to ensure that partners can prove the
Co-ownership regime: the second regime available is the co-ownership regime. In this regime you automatically agree to share with your partner any
asset that you purchase.
Inheritance tax
One of the attractions of the new PACS is the tax allowances. Partners will now benefit from the same advantages as spouses and will be exempted of
any inheritance tax when inheriting the estate. Any gift made during the pacs will remain subject to the previous rules where the partner benefits from a
threshold of 80,724€ before paying any inheritance tax.
Termination of the PACS
In accordance with Article 515-7 of the Civil Code the PACS will end up in the following cases:
1 - Partners decide by a mutual agreement to put an end to a PACS. In that case they must file a joint written declaration with the Civil Court.
2 - If one of the partners decides to put an end to a PACS, he or she shall serve notice of his or her decision and shall send a copy of that notice to the Civil court.
3 - If one of the partners puts an end to a PACS by marrying, he or she shall notify his or her decision to the other by service and shall send copies of the letter and of his or her record of birth on which mention of the marriage has been made, to the Civil Court.
4 - A PACS would come to an end if one of the partners dies.
The new regulation will require Notaires and lawyers to be more vigilant when they meet with clients of different nationalities. Contracting a civil
partnership, separating, settling an estate are some of the international matters that we face each day. If a lawyer is not aware of the current
regulations and ask himself the rights questions, the consequences for our clients could be disastrous.
The PACS, contrary to the Civil Partnership Act 2004, is a contract made by two adults to the same or opposite sex to organise their lives. Like the Civil Partnership Act 2004 the PACS sets out the rights and duties of partners and requires formalities regarding the registration and termination.
The PACS, contrary to the Civil Partnership Act 2004, is a contract made by two adults to the same or opposite sex to organise their lives. Like the
Civil Partnership Act 2004 the PACS sets out the rights and duties of partners and requires formalities regarding the registration and termination.
The Regulation 2016/1104 of 24 June 2016 implementing enhanced cooperation in the area of jurisdiction, applicable law and the recognition and enforcement of decisions in matters of property consequences of registered partnerships came into force on 29 January 2019. At the moment only 19 member states have signed the regulations: Belgium, Bulgaria, Germany, Finland, France, Greece, Italy, Croatia, Luxembourg, Malta, Netherlands, Austria, Portugal, Sweden, Slovenia, Spain,Czech Republic,Cyprus and Estonia.
The aim of the regulation was to uniform one single law that will apply to all property regardless of where it is located. It is therefore the unity of the applicable law that has been preferred by the drafters.
Article 22-a provides that partners may choose the law of the State in which at least one of the two partners or future partners has his habitual residence at the time the agreement is concluded.
Article 22 (b) also contemplates the choice of the law of a State of which one of the partners or future partners is a national at the time the agreement is concluded.
Finally, article 22-c provides that future partners may choose the law of the state under whose law the registered partnership was created.
In the absence of a choice of applicable law, Article 26 of the Regulation provides that the law applicable to the property consequences of the registered partnership is the law of the State according to the law of which the registered partnership was created.
For the case that two partners decide to choose French law as the law applicable to your partnership, I have set out below the principles rules in France.
Conditions to conclude a PACS
The PACS is only permitted for unmarried individuals who have not already contracted a PACS with a third party. It will be prohibited within degrees of relationship. For instance, adopted children, siblings, stepparents with children cannot contract a PACS. As the PACS is a contract the rules regarding the consent will also be applicable.
Regarding the form of the PACS, the partners will provide the Mairie with two original of a written contract. No particular form is required and the partners could prepare the contract themselves or request the assistance of a Lawyer (Solicitor or Notaire) to guide them.
Effects of the PACS
The PACS will have an effect and consequences depending on your residency. Some of the rules will only apply if you are French residents, others such as French real assets and tax consequences concern both UK and French residents. For those who will elect residency in France the PACS resulting from the Law dated 23rd June 2006 reinforce the concept of assistance during the PACS. The PACS copies the rules applicable for married
couple under the legal French matrimonial regime. It will fix the modalities of the mutual assistance that are compulsory during the PACS.
The mutual assistance will consist for the partners to financially assist each other in day-to-day life and be responsible for any debt contracted with a third party to the exception of charges related to the common residency. The main amendment with the Law concerns the identification and ownership of the assets during the PACS. Originally all assets were deemed to be jointly owned unless a declaration was made by the partner in the deed of sale. Now French law introduced two different regimes which can be chosen by the partners in their convention:
Legal regime: the legal regime of PACS will complies with the separation of ownership. Without entering into details any asset that you purchase on your own will be personal and cannot be part of the PACS. It is obviously wise to ensure that partners can prove the
Co-ownership regime: the second regime available is the co-ownership regime. In this regime you automatically agree to share with your partner any
asset that you purchase.
Inheritance tax
One of the attractions of the new PACS is the tax allowances. Partners will now benefit from the same advantages as spouses and will be exempted of
any inheritance tax when inheriting the estate. Any gift made during the pacs will remain subject to the previous rules where the partner benefits from a
threshold of 80,724€ before paying any inheritance tax.
Termination of the PACS
In accordance with Article 515-7 of the Civil Code the PACS will end up in the following cases:
1 - Partners decide by a mutual agreement to put an end to a PACS. In that case they must file a joint written declaration with the Civil Court.
2 - If one of the partners decides to put an end to a PACS, he or she shall serve notice of his or her decision and shall send a copy of that notice to the Civil court.
3 - If one of the partners puts an end to a PACS by marrying, he or she shall notify his or her decision to the other by service and shall send copies of the letter and of his or her record of birth on which mention of the marriage has been made, to the Civil Court.
4 - A PACS would come to an end if one of the partners dies.
The new regulation will require Notaires and lawyers to be more vigilant when they meet with clients of different nationalities. Contracting a civil
partnership, separating, settling an estate are some of the international matters that we face each day. If a lawyer is not aware of the current
regulations and ask himself the rights questions, the consequences for our clients could be disastrous.