French Entrée Tax & Law Quarterly – Understanding Co-ownerships

When you buy an apartment, villa or chalet in France that is part of a group of similar properties with shared facilities, the property will be subject to a legal structure known as a co-ownership (une copropriété). The shared facilities may be limited to a shared access road and lighting in the case of a group of villas or chalets. For apartments, the common areas could include landscaped areas, a car park, a lift and/or a swimming pool.

A co-ownership scheme is created by a legal document called an état descriptif de division (EDD for short). A further document containing the co-ownership rules (le reglement de copropriété) will either be incorporated within the EDD or will form a separate document.

The EDD will divide the building or complex into lot numbers and common parts. The individual apartments, storage areas and car parking spaces will each be allocated a lot number and any areas available for use by all co-owners (stairs, corridors, lifts, gardens and the structure and roof of the building) are designated as common parts.

Each lot is assigned a fixed proportion of the communal charges. This is assessed according to the size of each individual apartment, villa or chalet in relation to the others. The proportions are expressed in percentages. The communal charges are then invoiced according to the stated percentages.

The EDD and the co-ownership rules are important documents which set out the rights and obligations of individual owners so as to ensure harmonious use and enjoyment of the property for all. They will also set out rules and procedures for the management of the building or complex and provisions for the production of annual accounts and the holding of an Annual General Meeting of the co-owners.

A managing agent (either an individual or a company) known as the syndic will be appointed by the owners to deal with the day to day management of the building. The syndic is accountable to the co-owners. On the sale of a property which is part of a copropriété, the notary is required to inform the syndic of the proposed sale and must check that the seller has paid his share of the communal charges for the current period. Details of any arrears and of any major issues affecting the building must be notified to the notary so the buyer can be informed before completion.

It is advisable to check out the copropriété before becoming committed to buy and the best way to do this is to request a copy of the Minutes of the most recent AGM of the co-owners. This should give a good insight into whether the copropriété is well managed or not and whether there are any major issues of concern or major expenditure in the pipeline. In addition, you should ask for copies of the accounts for the last three years as well as the budget for the current year, so you can see what expenditure has been incurred in the past and what is envisaged in the near future.

Once you become an owner, it is important to keep abreast of developments relating to the copropriété. You should make sure the syndic has your UK address so that any communications can be sent to you in the UK rather than to an empty property in France.

You must make sure you keep up to date with your service charge contributions and the best way to do this is to set up a direct debit from a French bank account. You should also try to attend the co-owners’ AGM or send someone to represent you and vote on your behalf if you cannot attend in person.

If you plan to carry out works to your property, you must check whether the prior consent of the co-owners is required. If the proposed works affect the structure or alter the exterior of the property, approval of the co-owners is likely to be required (in addition to any appropriate planning consent from the local planning authority). If the works are internal only – prior consent is unlikely to be necessary although it is always a good idea to mention your plans to the syndic so they are aware and can respond to any queries or complaints from other owners.

Most copropriétés are well run and relatively problem free. However there is always a risk that one individual or a small group of individuals will create trouble, fail to pay their proportion of the service charge or fall out with their neighbours. Fortunately, there are laws and regulations which can be relied upon to protect the interests of the majority when problems do occur.

This article first appeared in French Entrée’s Tax & Law Quarterly – April 2010.