France: Buying A Vineyard in France? Some Considerations…

In the last few years there has been a marked increase in the number of wine-loving overseas investors seeking to purchase vineyards in France.

A host of considerations apply when making an overseas real estate purchase, particularly a high value investment such as a vineyard. Some of these considerations are self-evident, such as having advisers who can deal with language and cultural issues and making sure the seller actually owns the property being sold. Other considerations are more technical or abstract in nature, such as understanding the relevant laws and proper transaction structuring. The following are some of the key considerations:

Question 1 – Who can (or would) purchase a French vineyard?

French investment law does not generally restrict investment on the basis of citizenship or jurisdiction of incorporation of the investor so the short answer is that anyone can purchase a vineyard (or at least anyone with the necessary funds!). This is subject to obtaining government approvals which apply to all such purchases, and making certain administrative filings (discussed in greater detail under the relevant headings below).

Generally, the starting price for a French vineyard is likely to be in the order of a million Euros (approximately RMB 8 million), but this will depend on factors such as plot size, quality, reputation and whether the acquisition is just of real estate or of an entire business. Although not for everyone, there are many reasons why an investor might look to purchase a vineyard, ranging from a desire to consolidate related business interests (such as wine distribution/retailing or restauranteering), to wanting to make a pure investment, to simply having a love of French wine.

Question 2 – Acquisition structure – purchase of real estate or purchase of shares?

An important issue that will need to be decided early on is whether the underlying real estate of the vineyard will be acquired (and whether any other assets or business will be acquired) or, alternatively, whether the shares of the company owning the real estate will be acquired.

This decision, although made early on in the process, will have significant implications for the transaction. It will affect what consents and notifications are required, and the amount and types of tax payable. Ultimately, the final decision will depend on the investor's particular needs and requirements, as well as the particular circumstances of the transaction.

Question 3 – What tax considerations apply?

As transaction structure is often driven by tax considerations you may like to bear in mind the following French taxes and related costs may apply to your purchase:

  • Sale of real estate - A sale of real estate assets located in France is subject to French registration tax at a rate of 5.09%. Real estate transactions also require a deed to be prepared by a French notary, who charges additional fees in the region of 1.5% - 2.5% of the transaction value. In addition, sales of certain real estate assets (such as certain plots of land which could be built on) may be subject to French VAT. The top rate of VAT is due to rise slightly next year and reach 20%.
  • Sale of a company - Generally, the sale of an ownership interest in a French company is subject to stamp duty. The rate of stamp duty depends on the type of company (there are several types of French corporation), but is generally between 0.1% and 3% of the transaction value. If the company is considered a 'real estate company', then the rate of stamp duty is 5%.
  • Sale of assets of a business - A sale by an enterprise of all of its assets and liabilities is considered a sale of a going concern. This is subject to French registration tax at a rate of 5% of the sale price. A sale of only some of the assets of a business is generally subject to French VAT although there are certain exceptions to this.

In addition, there may be tax considerations arising from tax laws in the buyer's home jurisdiction which need to be factored in to the transaction.

Question 4 – What government approvals are required?

Depending on the transaction structure, a number of consents, notifications and approvals may be required. The buyer's legal adviser will need to work through these issues with their client to determine which of these items are applicable. An indicative list is as follows:

  • Approval of the Ministry of Agriculture - Under French law, the prior approval ofthe Ministry of Agriculture is required for anon-French individual or company to own an agricultural business in France. A company fallsinto this category if either: (i) more than 50%of its shareholders are non-French nationals; or(ii) more than 50% of its share capital is held,directly or indirectly, by non-French nationals.The Ministry of Agriculture also determines thetype of activities which the applicant is permittedto conduct once an operating licence has beengranted.
  • Operating licence from the local Ministry of the Interior (Préfecture) – French law requiresthat a vineyard holds an operating licenceprior to engaging in agricultural activities.If a corporate entity holding such an operatinglicence is acquired and retains the necessaryqualified personnel to operate the vineyard, thelicence will transfer along with ownership of thebusiness and it will not be necessary to apply for anew licence. However, if the investment takes theform of an asset acquisition, this will constitutea change in operator and a new operating licencewill usually be required.

As an operating licence must be obtained prior to completion of a transaction, an application can be made between signing and completion of the transaction (which can add to the time taken to complete the purchase). An application for an operating licence usually takes up to 4 months.

  • SAFER notification and pre-emption rights – SAFERs (Sociétés d'aménagement foncier etd'établissement rural) are public organisationswith pre-emption rights to buy most real estatecurrently or potentially used for agriculture andrelated agricultural buildings or moveable assets.There are a number of SAFER across Francewhich operate in relation to their respectiveregions. The purpose of the SAFER system is toavoid farming monopolies and over-speculationin agricultural land and to reorganise landparcels in order to enlarge farms that werepreviously below the threshold of profitability.As such, the relevant SAFER has jurisdiction overagricultural real estate, including vineyards, andmust be officially notified of a relevant sale so that it can decide whether to exercise its pre-emptionrights. Although this is not strictly a'consent', if the SAFER decides to exercise itspre-emption rights then SAFER will purchasethe land in place of the would-be buyer, therebyfrustrating the purchase. This therefore needs tobe closed-off as part of the transaction. A relevanttransaction structuring point is that a transfer ofshares in a company owning real estate will notbe subject to a SAFER pre-emption right.

It is possible to require in the purchase documentation that obtaining necessary consents is a condition precedent to the completion of the transaction. If this approach is adopted, it will mean there is a time lapse between the signing of deal documents and the closing of a transaction.

Question 5 – Are there any other requirements for foreign buyers?

For non-EU investors, the following declarations may be required if the respective criteria are met (although these are simply declarations and no consent is required):

  • If there is an investment in real estate in excess of €1.5 million (approximately RMB 12 million) or an investment in agricultural land in order to operate a vineyard, a declaration must be filed with the French Ministry of Finance and Economy at the time of completion of the investment.
  • If the investment is for more than €15 million (approximately RMB 120 million) and results in the investor owning more than 10% of the capital/voting rights of a French company or more than 10% of a piece of real estate, a declaration must be filed with the Banque de France (France's central bank) within 20 days of completion of the investment.
  • If the investment involves the acquisition of more than 33.3% of the share capital/voting rights of a French company (either directly or at a higher level in the corporate group, such as by acquisition of its parent entity), a further administrative declaration to the Ministry of Finance and Economy is required. This is not required if the acquisition is of the underlying agricultural land rather than shares in a holding company.

Additionally, if the transaction involves a French company to which the buyer is appointing a legal representative (and potentially other officers and directors, depending on the type of corporate entity) and the appointed person is both: (i) a non-EU national; and (ii) not a resident of France, then the activities of the legal representative must be declared to the local Ministry of the Interior (Préfecture). There is no such requirement for EU nationals. Alternatively, if a legal representative wishes to reside in France, a temporary residence permit is required authorising such person's business activities.


As should be evident from the above, there are a multitude of issues to consider in relation to the acquisition of a French vineyard and the five questions discussed in this article are only a starting point.

A potential investor should make it a priority to instruct a legal adviser at an early stage of the process, making sure that their legal adviser can provide language support and cultural experience in both France and their home jurisdiction and that the adviser has the experience necessary to effectively progress the transaction.

Originally published 13 March, 2013.

Visit us at

Mayer Brown is a global legal services organization comprising legal practices that are separate entities (the Mayer Brown Practices). The Mayer Brown Practices are: Mayer Brown LLP, a limited liability partnership established in the United States; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; Mayer Brown JSM, a Hong Kong partnership, and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2013. The Mayer Brown Practices. All rights reserved.

This article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein. Please also read the JSM legal publications Disclaimer.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions