Key takeaway
In a landmark decision dated 3 June 2026 (No. 24-19.612), the Commercial Chamber of the French Supreme Court (Cour de cassation) confirmed the validity of so-called catch-all termination clauses. Such clauses provide for the automatic termination of a contract in the event of a breach of contractual obligations without individually listing every obligation concerned.
The Court held that Article 1225 of the French Civil Code does not require each contractual obligation to be expressly identified within the termination clause itself. What matters is that the obligations whose breach may trigger termination can be identified clearly and unambiguously from the contract as a whole.
This decision is particularly relevant for foreign companies, investors and in-house counsel entering into contracts governed by French law. It provides important guidance on the enforceability of termination clauses and confirms that broadly drafted contractual termination mechanisms remain effective under Article 1225 of the French Civil Code.
The uncertainty created by the 2016 Reform of French Contract Law
Article 1225 of the French Civil Code, introduced as part of the 2016 reform of French contract law, provides that a termination clause must specify the obligations whose non-performance will give rise to termination of the contract.
Before the reform, French courts consistently held that an automatic termination clause was valid provided that:
- it clearly reflected the parties’ intention that the contract should terminate automatically upon breach;
- the relevant obligations could be identified clearly and unambiguously; and
- the clause applied only to obligations expressly provided for in the contract.
Importantly, the pre-reform case law did not require those obligations to be listed individually within the termination clause itself. As a result, broad-form termination clauses were widely used in commercial agreements, including service agreements, distribution agreements and licensing arrangements.
The introduction of the word “specify” into Article 1225 gave rise to considerable debate among commentators. Some argued that the provision merely reflected the existing case law. Others believed that Parliament intended to impose a stricter requirement and that general termination clauses would no longer be enforceable unless every relevant obligation was expressly enumerated.
The Paris Court of Appeal’s approach
The issue arose in litigation between beIN Sports France and Groupe Canal+ concerning a sports broadcasting sublicensing agreement. The disputed clause permitted termination in the event of a breach of a “significant” or “substantial” contractual obligation, reflecting the common-law concept of a material contractual obligation.
The Paris Court of Appeal adopted a restrictive interpretation of Article 1225. It considered that the clause failed to satisfy the statutory requirement of precision because it did not identify the relevant obligations individually. On that basis, the clause was held to be ineffective.
The French Supreme Court’s decision of 3 June 2026
The Cour de cassation overturned the decision.
In a detailed analysis of the law prior to the 2016 reform, the Court emphasised that French case law had never required a termination clause to enumerate individually every obligation whose breach might trigger termination. Rather, the essential requirement was that the parties should be capable of identifying those obligations clearly and unambiguously.
The Court further observed that neither the preparatory materials relating to the 2016 Ordinance nor the parliamentary debates leading to the ratification legislation of 20 April 2018 indicated any intention on the part of the legislature to depart from that established position.
The Court consequently held that the purpose of Article 1225 is to ensure that the debtor can clearly identify the contractual obligations whose breach may result in automatic termination of the contract. A clause satisfies that requirement where it provides that a breach of certain contractual obligations will lead to termination and those obligations can be identified clearly and unambiguously, regardless of whether they are individually listed in the termination clause itself.
Because the Court of Appeal had failed to determine whether the relevant obligations could nevertheless be identified from the contract with sufficient certainty, its judgment was quashed.
Continuity rather than change
This decision confirms that the 2016 reform did not fundamentally alter the legal framework governing termination clauses under French law. Rather than introducing stricter drafting requirements, Article 1225 should be interpreted consistently with the case law that preceded the reform.
Practical implications for Commercial Agreement
The decision is of particular significance for businesses, investors and legal practitioners involved in drafting and negotiating contracts governed by French law. By confirming the validity of catch-all termination clauses, the French Supreme Court has provided welcome legal certainty and preserved an important contractual drafting technique. The ruling also highlights the continuing importance of precise contractual drafting, as the enforceability of a termination clause ultimately depends upon the clarity of the obligations to which it relates.
➤ Drafting Commercial Agreements under French Law
For companies entering into commercial agreements governed by French law, the decision confirms that termination clauses do not need to contain an exhaustive list of every obligation whose breach may result in termination.
Instead, parties should focus on ensuring that the relevant obligations are clearly and precisely defined throughout the contract. A termination clause may validly operate by reference to obligations contained elsewhere in the agreement, provided that those obligations can be identified without ambiguity.
This approach offers greater drafting flexibility and avoids unnecessary duplication within complex contracts. It also allows parties to maintain concise and effective termination provisions while preserving legal certainty in the event of a dispute.
➤ Considerations for International Businesses Operating in France
The decision is equally important for international businesses conducting operations in France or entering into contracts governed by French law.
Foreign companies are often concerned that French contract law may impose formal drafting requirements that differ significantly from those found in common law jurisdictions. The judgment provides reassurance that French courts will adopt a pragmatic approach and focus on whether the contractual obligations capable of triggering termination can be identified clearly and unambiguously.
For international groups, the decision facilitates the use of contract templates and termination provisions that are broadly consistent across multiple jurisdictions while remaining compliant with French law requirements.
Businesses operating across borders should nonetheless ensure that contracts governed by French law are reviewed carefully, particularly where termination rights are linked to concepts such as material breach, substantial obligations or key contractual undertakings. Clear drafting remains essential to ensure that termination provisions achieve their intended commercial purpose and withstand judicial scrutiny.
Conclusion
The decision of 3 June 2026 is likely to become a leading authority on Article 1225 of the French Civil Code. It settles a debate that had persisted since the 2016 reform and confirms that French law continues to recognise the validity of catch-all termination clauses.
Frequently Asked Questions
What is a catch-all termination clause?
A catch-all termination clause is a contractual provision which allows a contract to terminate automatically upon the breach of specified contractual obligations, without requiring each such obligation to be expressly listed within the termination clause itself.
Are catch-all termination clauses valid following the French Supreme Court’s decision of 3 June 2026?
Yes.
The French Supreme Court confirmed that a catch-all termination clause complies with Article 1225 of the French Civil Code where the obligations capable of giving rise to termination can be identified clearly and unequivocally from the contract. The fact that those obligations are not individually enumerated within the clause itself does not affect its validity.
What should parties consider when drafting catch-all termination clauses?
The decision confirms that catch-all termination clauses remain an effective and enforceable drafting technique under French law.
Nevertheless, parties should ensure that the obligations capable of triggering termination are defined with sufficient precision elsewhere in the agreement. As a result, the drafting of the substantive provisions of the contract is of particular importance, as any ambiguity may undermine the enforceability of the termination mechanism.
Careful drafting remains the key to ensuring that such clauses achieve their intended purpose and withstand judicial scrutiny.
Drawing on its longstanding experience in commercial law, AUMANS Avocats regularly advises clients on the drafting of commercial agreements and represents them in complex commercial litigation. Should you require any further information regarding the matters addressed in this article, our team would be pleased to assist.
